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The Companion Advisor:
General Interest
Losing
a family member provides an Inheritance
What next - spend
like mad or caution?
Provided by AIC Investments
A Companion Advisor article
The stress caused by the death of a loved one can be
compounded by the financial decisions involved in the ensuing inheritance.
The emotions can be at times overwhelming, and cloud a bereaved person's
judgment. It is at these times that you need the obvious support of family
and friends, but also, a trusted financial advisor, to make sure
what your loved one intended for you financially is put to the best use
possible.
First, there are strong, and perhaps, conflicting emotions
to sort through. And stress is particularly acute if the death was unforeseen.
Suddenly you're saying, "What am I going to do?
I don't know much about the investment side. Should I put this inheritance
in the bank, even though interest rates are low? Should I give some to
my children? Should I give some to the other family members?"
This is where the stress comes in, from lack of knowledge,
and fear.
Administering an estate, regardless of the size, takes
time and energy. It may be a while before funds can actually be dispersed.
Use this time to investigate choices you have and make a financial plan
for your inheritance. A "cooling-off" period will help avoid
letting emotions overcome your decision-making ability.
Use the time to talk to both friends and professionals
- including an investment advisor. In the meantime, it's a good idea to
leave the cash in an interest-bearing bank account or a money market mutual
fund that can be easily accessible.
Just park the money away, 30 days to 90 days. Because,
quite often, people react, and then, sure enough, six months later, they
say "Why did I jump so fast?"
If your inheritance makes you feel like indulging and
going on a spending spree, you may want to move with caution. Spending
it all now could leave you later wishing you had saved for your retirement
or a child's college education. A good rule of thumb is to make a list
of all the purchases you want to make now and set the list aside for a
couple of weeks. Revisit the list and evaluate each item. Realistically
look at what you can afford and what is a worthwhile expense.
Whatever financial plans you make for your inheritance,
from current purchases to long-term savings, make your purchases and investments
with the future in mind.
Consult your Fiscal Agents investment advisor
and develop a plan that works best for you.
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, Fiscal Agents Money Management Newsletter
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