You may face both emotional and practical challenges should you receive an inheritance. You will feel sadness at the death of a beloved one or guilt that someone’s death has enriched you. At the same time there can be feelings of excitement or uncertainty, particularly when a life-changing sum is involved. An inheritance brings big questions: What are the implications of this inheritance on my life today? How should I plan for the future?

WHOM CAN YOU TRUST?

Analysis and advice are needed; whom can you trust? First on your to-do list should be seeking out professionals to advise you on the financial planning, legal and tax implications of your new wealth. You want a wealth manager, a CPA and a lawyer who will take initiative on your behalf, and not just wait for you to bring questions to them. Your team of experts should be prepared with analysis, insights and action plan recommendations. They should know what questions to ask, how to crunch the numbers, which tax and estate laws to apply, and how to make the most appropriate planning and investing moves for your situation. You want advisors who will answer calls and emails quickly. Be tough. Get references. Make sure you understand their advice clearly. If you do not, get new professionals.

FINANCIAL PLANNING

Engage a comprehensive personal financial planner to answer these questions:

• Am I financially independent?

• If not now, with careful planning, when will I be financially independent?

• If I am independent, how do I preserve and prudently manage my wealth so I remain independent for the rest of my life?

• How can I maximize cash inflow to fund my lifestyle and achieve my true life dreams?

From there, your planner should provide a financial plan that you understand and can follow.

TAX PLANNING

Learn from your tax specialist:

• How will this change my taxable income?

• How can I reduce my income taxes and increase my wealth? Deal with a professional who will connect with you during the year to ensure all is being done to maximize your tax savings and cash inflow. Remember to pay taxes on a timely basis to avoid wasting your wealth on penalties.

INVESTING

Your wealth manager should clearly explain the proposed allocation and investment recommendations and how they meet the objectives and guidelines of your financial plan. If you do not clearly understand the recommendations and the due diligence process used to arrive at them, look for another wealth manager. Require, at minimum, quarterly reports to monitor performance and portfolio status in a way that you can follow.

ESTATE PLANNING

Update your wills and estate plan. Consider giving gifts to children and charitable organizations only after you have ensured your own lasting financial independence. Your financial plan might assume that you or your surviving spouse will live past age 100. Remember, it is your money, and it would be tragic if it kicked the bucket before you did.