What to Do With an Inheritance

According to the AARP, the median amount of today's inheritance is about $64,000. While that won't provide financial security for life, it is a lot of money and, therefore, requires careful planning before deciding what to do with it. The following tips can help you manage an inheritance.

Step One...Do Nothing: Remember, you've just lost a loved one, you're receiving a sizable chunk of money, and your judgment may be clouded by emotion. Rather than make a decision you'll regret later, put the inheritance in a money market or savings account to keep it safe while you take time to make a plan.

Check the Tax Laws: Some inheritances are tax free, but some are subject to federal and state taxes. So, diligently record what you inherited and when...and check the tax laws before you decide what to do with it.

Stick to Small Wishes: Many people dream of a vacation home or taking a luxury cruise around the world. Receiving an inheritance may make those dreams seem within reach. Often, however, they're not realistic for your overall lifestyle and budget. So keep the splurging to a small gift for you or your family. Keep the big picture in mind for the rest of the money.

Invest as Usual: Instead of thinking of your inheritance as "found money," treat it like the rest of your investments. Determine which options and risk-level make sense, based on your entire portfolio and future plans.

Mortgage Interest Rates*

Rates as of Wednesday, 29th October, 2008:

 

Conforming

APR

Payment per
$1,000

Jumbo

APR

Payment per
$1,000

30-Yr. fixed

6.500%

6.644%

$6.32

6.250%

6.344%

$6.16

15-Yr. fixed

6.250%

6.485%

$8.57

6.125%

6.281%

$8.51

7-Yr. fixed ARM

6.250%

6.391%

$6.16

6.000%

6.093%

$6.00

5-Yr. fixed ARM

5.750%

5.887%

$5.84

5.750%

5.842%

$5.84

3-Yr. fixed ARM

5.750%

5.887%

$5.84

5.625%

5.716%

$5.76

5-Yr. Interest Only

5.875%

6.013%

$4.90

6.000%

6.093%

$5.00

 

 

*Rates are subject to change due to market fluctuations and borrower's eligibility.

Licensed Mortgage Banker, NJ Department of Banking and Insurance. Corporation also services CO, CT, DE, FL, GA, IN, MA, MD, MN, MI, NC, NH, NY, PA, SC, TN, VA, & RI.

 
0 comments • Karl Peidl - Accredited Loan Consultant • October 29 2008 01:19PM