Mature Life Features

. . . between weather forecasters

and politicians:

the weather folk admit they’re wrong most of the time.

= = = = =

Emotional Stress

Tarnishes Legacy

Mature Life Features

A former neighbor recently received news she thought would never happen to her: a rich uncle died and left her some money. Not a lot, mind you, but it was an inheritance, a totally unexpected legacy.

Most people have some idea what they’d do with a financial windfall: pay off the mortgage, buy a new car, take cruise around the world – it depends on how much money is involved. But then what? It isn’t easy becoming wealthy overnight. Stories of the profligacy, foolishness, or ill-luck of lottery winners pour out of the news media with regularity.

In the case of our acquaintance, she immediately quit her part-time job, paid off the small debt she had, and sought out a financial adviser. She invested he remainder of her inheritance in safe income-producing financial vehicles to augment her monthly Social Security checks. Then she decided to move to another state to live with one of her children after discussing the matter with them and the rest of the family.

It has been estimated that current retirees will pass on more than $10 trillion to their heirs. Many beneficiaries of this largess have grown up poor or in modest circumstances, or have mismanaged their finances throughout their lives and have little concept of the challenges they face.

Do they put that $10,000, $100,000, or $1 million into the stock market or real estate? Do they sell the company they inherited, or do you try to keep it running? Do they keep all the stocks, bonds, and mutual funds in the portfolio that suddenly becomes their property?

Financial planners consistently offer this piece of advice: don’t do anything for awhile.

That’s more difficult than it sounds. Forty percent of baby boomers who received an inheritance of at least $50,000 made their financial decisions in less than a week, according to an Oppenheimer Funds survey.

While the financial facet requires patience and some effort to educate yourself on the best avenues to follow, the emotional side of inheriting can be a much more difficult challenge. The inheritance usually is intertwined with the death of a loved one and, as a result, associated with grief. Guilt often is a major emotional component of a legacy, leaving the heir feeling uncomfortable with not having earned the money.

There’s also a feeling of isolation compounded by the discomfort and worry inflicted by friends and family members badgering them for loans and gifts. The emotional stress causes many folks to get rid of their inheritance as quickly as possible.

On the other hand, people who take their time to plan what to do with an inheritance have been known to husband their wealth and continue living in their current lifestyle with the comfortable assurance that their financial future is secure.