Coping With an Unexpected Inheritance
The July issue of Money magazine contains an interesting article that discusses the problems that some folks encounter when they come into an unexpected inheritance. Nice problem to have, most might think, but it truly is the case that some are overwhelmed, and even paralyzed, by the notion of what to do with their new found funds (psychologists even have a name for the phenomenon - "Sudden Wealth Syndrome"). The article provides some fairly solid advice for those who happily find themselves in this position:
- Take a breather and wait before making any but the most critical decisions about what to do with the money.
- Consult with an accountant or financial professional, as well as an estate planning attorney.
- Allocate funds first to address any urgent financial needs, such as paying down high interest credit cards.
- Make a wish list and prioritize how you will allocate funds left over after resolving imminent needs.
All of this is good advice. And if you are on the bequeathing end, engaging in proper planning would include, I suggest, helping to prepare any of the objects of your bounty who might be prone to become subject to "sudden wealth syndrome."
