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November 9, 2022

3 Smart Ways to Use Inherited Money

Learn how to strategically manage a loved one’s last gift.

When a relative or friend passes away, they may leave an inheritance. While this does provide added benefits for financial opportunities, it can also add unnecessary stress during an already difficult time. Here are three tips to keep in mind if you ever find yourself in this position.

Seek out professional advice

An inheritance is commonly received during an emotional and difficult time. The combination of grief, confusion, and stress can be overwhelming. Receiving assets may relieve financial stress at this time, however, seeking out help from a professional, such as a fee-only financial advisor may be a smart choice. They can help ease your mind of any worries about making smart financial decisions with your inheritance. A financial advisor will be able to provide objective advice based on your financial situation and goals.

Pay off your debt

If you are in debt, an inheritance can offer the opportunity to pay off your financial burdens. Putting inheritance money towards high-interest debt such as credit cards or student loans can be extremely helpful. It could also be put towards making an additional payment on your vehicle. Managing your debts well provides financial freedom for new opportunities or aspirations that may present themselves.

Plan for the future

There are many ways you can use your inheritance to jump start your future! A financial advisor can help you distribute the money into savings, investment, or retirement accounts. If you have children, consider starting or contributing to a college fund with your new funds. Making a down payment on a home or paying down a mortgage is another good way to set yourself up for the future. Inheritance money can help you benefit from homeownership, but be careful to make sure you can afford mortgage payments and other home ownership costs down the line.

Citizens First Bank has the resources to help you navigate any financial changes you may experience in challenging times. Feel free to stop in or give us a call today.