When you receive an inheritance, it is important to figure out what
will you do with that money. If you do not plan properly on how to spend
that money, it will slip out of your hand within no time. If you have
already got the cash, or you are about to inherit the money, here are
some five tips for using it properly.
Don't Rush Your Decision
People
generally do not allow the money for a cooling-off period, after
receiving the cash. This is one of the worst mistakes that people
usually do. They are always in a hurry of spending the money without
thinking twice. You can save the money either in a money market account
or savings for at least two months in order to plan your options. You
can also put the money into a short-term deposit for saving it, because
you have to pay penalty if you withdraw it before time.
Assess Where You Are
If
you analyse your present financial situation, you can get an idea about
your future move. You can plan to start a college fund for your
children, add the money to your retirement savings or keep it as an
emergency fund. Make a goal in life, so that you can achieve it with the
help of your inheritance.
Be Realistic About Your Inheritance
A
sudden chunk of money will you lead to towards a changed lifestyle. The
things like a new car or a luxury vacation that you could not afford
before will now seem to be very tempting. You have to be careful to
control your temptation and save your money for future needs.
Establish Boundaries
It
is evident that when you receive an inheritance, many people come with a
try to have a share in the money. Bank or financial sales people may
call you so that you invest your money in their products. You may also
be asked to make a huge donation by any charitable organisation. So, it
is very important to set boundaries and prepare yourself for saying no
to the people.
Be Proactive
You may need some professional
help to figure out how to save your inheritance. It is absolutely fine
to hire a financial advisor, but do not make your decision solely as per
his guidance. In the end, it will be you who will take the final
decision. Do some research and set your goals before taking
professional's help.