Ask Elaine: What should I do after a life-changing inheritance?



Hi Elaine: I’m coming into an inheritance and going from broke to wealthy. My uncle took his life last year and left me everything he had. Now I have a house in the desert and lots of money to manage. What do I do with this totally life changing blessing (so hard to say that considering where it came from)? How do I do it? How do I know I’m making the right choices? I’m so lost! All while mourning the loss of my best friend/uncle. Between this life event, two kids, being a single mom, and a very demanding career as a personal assistant, how do I do what’s right?!

Grieving: I’m so sorry for your loss. Your predicament reminds me how cruel it is that money doesn’t come with a best practices playbook — especially under these emotionally taxing circumstances. Unless you come from money, no one teaches you how to be rich — nevermind how to stay rich. It seems predatory that financial literacy isn’t taught in every high school, but that’s another column.

You have a lot on your plate right now, tactically and emotionally, so let’s deal with both. The first investment I hope you’ll make is in therapy for yourself and your family to help navigate the grief and guilt swirling around your inherited wealth. Getting your mind-set right around the money is a really important first step in becoming a fit steward of your inheritance. It sounds like you may be dealing with some survivor’s guilt and even a sense of unworthiness that you didn’t “earn” the money you’ve been given. But here’s the thing about gifts: they aren’t earned. All they require of you is your acceptance.

“Experience with money is taught and learned. You aren’t expected to know what to do, so grant yourself some grace,” says financial expert Nicole Walters, CEO of Inherit Learning Company. “Whenever we don’t know what to do, we have to lean on experts and fortunately there is a specific expert category for this: high net worth wealth management firms. These companies advise you on how to maintain a diverse portfolio — everything from stocks to trusts to real estate. To find one, reach out to an expensive divorce or estate lawyer in your city. They always know the best wealth managers for people who come into large sums and need to make it last.”

One of the things we aren’t taught about money is how to avoid emotional spending. Protecting your financial inheritance is a top priority for you and your family’s future, so it’s worth investing the time, energy and cost of finding a financial adviser or wealth manager who can help you invest wisely and navigate all the tax implications responsibly.

On an emotional level, “your biggest hurdle may be the acceptance piece,” notes Steve Tresnan, a private wealth adviser at The Bahnsen Group. Accepting the situation. Accepting the generous gift. And accepting that you have entered into a grief-laden life transition that isn’t easy to navigate.

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Two things can be true: It’s ok to be happy about your inheritance while acknowledging that it came with a ton of guilt. It’s what you do with the guilt that matters. Are you going to allow it to squander this opportunity you’ve been given to set you and your family up for financial success? Or are you going to let it motivate you to ask for the help you need to be the best steward of your family’s fortune that you can be?

Your uncle left you his life savings because he loves you and he wants you to be in a better position financially and in life. I hope you will honor his generous gift to you by enjoying it and investing it wisely. Walters adds, “It’s a bittersweet blessing but taking care of the money well is a lovely way to honor his legacy.” Whatever you decide to do with the money, please don’t let it make you miserable.