Four ESSENTIAL questions new inheritors need to ask
Four ESSENTIAL questions new inheritors need to ask
You’re here because you need help understanding what to do with a current or future inheritance.
I’ve got you. I’m Katherine. I’m a CERTIFIED FINANCIAL PLANNER™, a financial advisor for inheritance, and a fellow inheritor.
Keep reading for ESSENTIAL guidance on what to do with your inheritance and my tips for inheritors building a path forward after the death of a loved one.
Posted on February 4, 2025 by Katherine Fox.
Four ESSENTIAL questions new inheritors need to ask
I know it’s hard to inherit a huge amount of wealth in your 20s, 30s, and 40s.
When you inherit millions before you've hit traditional wealth-building milestones, the journey looks different than it does for older inheritors.
You can’t talk to your friends about how stressful it is. All they’ll hear is you bragging about having money.
You may have considered looking for an inheritance financial advisor to help. In the meantime, you’re stuck with more questions than answers.
You might be wrestling with questions like:
How do I plan for what to do with an inheritance?
How do I prepare for the emotional effects of inheriting?
What should I do after getting an inheritance?
What do I do if my inheritance is in a trust?
Luckily, you ended up here.
Keep reading for my ESSENTIAL tips for younger inheritors
These are all valid questions, and you're not alone in asking them.
After almost a decade working with younger inheritors, I've learned that managing inherited wealth successfully isn't just about making smart investment decisions.
It's about navigating complex emotions, preserving family relationships, and finding ways to align your new wealth with your values and future goals.
That’s why I founded Sunnybranch®
I’m Katherine. I’m a CERTIFIED FINANCIAL PLANNER® and a financial advisor for inheritance.
I’m here to help you through this journey, whatever your needs are.
If you’re trying to get up to speed, check out the 20 Terms Inheritors Need to Know or How to Talk to Your Parents About Their End-of-Life or Estate Plan.
And if you’re deep in the weeds and don’t know what to do next, schedule a FREE consultation to see how I can help you figure out what to do with an inheritance.
How do I plan for what to do with an inheritance?
No one wants to think about losing their loved ones, let alone plan for it.
But as someone who works with inheritors every day, I can tell you that having these conversations early makes a world of difference.
Breaking the Silence
Most families don’t talk about inheritance until it's too late.
After a loved one dies, these inheritors are left trying to piece together their family's wishes and values after the fact, during one of the most emotionally difficult periods of their lives.
The good news? You can start these conversations now.
The key is approaching them with care and authenticity.
Instead of diving straight into numbers and logistics, start with values and legacy.
Once you've opened these channels of communication, you can gradually introduce more specific questions about their wishes and plans.
You may also find success bringing up the topic during natural transition points - like when your parents mention retirement planning or after they've completed their own estate documents.
Remember, this isn't a one-time conversation. It's an ongoing dialogue that deepens over time.
Your role isn't to push for information, but to create space for open, honest discussions about the future.
Building Your Financial Foundation
The best way to prepare for an inheritance is to pretend it doesn't exist.
The most successful inheritors I work with are those who build strong financial habits independently.
They live within their means, save for their own goals, and develop a solid understanding of money management.
This foundation becomes invaluable when they eventually inherit wealth.
Think of it like training for a marathon.
You wouldn't show up on race day without any preparation, right?
The same goes for managing inherited wealth.
Start building your financial fitness now by educating yourself about investing, taxes, and estate planning.
If that learning feels too overwhelming, working with a financial advisor before inheriting can be incredibly valuable.
The right advisor can help you develop good financial habits and prepare for the complexity that comes with substantial wealth. Look for an advisor who has experience working with inheritors and understands the unique challenges of managing generational wealth.
Four ESSENTIAL questions new inheritors need to ask
Keep reading to learn everything you need to know about questions to ask after getting an inheritance.
How do I prepare for the emotional effects of inheriting?
The emotional side of inheriting wealth often gets overlooked in discussions of family wealth planning.
As someone who works with many young inheritors, I can tell you that the feelings that come with receiving an inheritance are more complex than anyone expects.
The Emotional Rollercoaster
When you inherit money at a young age, you're dealing with many huge life changes at once. There's the profound grief of losing someone you love coupled with the sudden responsibility of managing significant wealth.
It's like being handed a gift and a curse at the same time.
Many of my clients describe feeling overwhelmed by conflicting emotions.
They're grieving their loss and feeling guilty about receiving money they didn't earn.
They want to honor their family's legacy but forge their own path.
They're excited about the opportunities this wealth creates but anxious about making mistakes.
Here's what I want you to know: all of these feelings are completely normal. There's no "right" way to feel about inheriting money. The key is acknowledging these emotions rather than trying to push them aside.
Taking Time to Process
One of the biggest mistakes I see young inheritors make is rushing into decisions before they're emotionally ready.
Society often pressures us to "do something" with money right away - invest it, spend it, donate it.
But when you're dealing with inherited wealth, pressing pause is often the wisest first move.
I advise all my clients to take at least 3-6 months before making any major financial decisions. Park the money somewhere safe and give yourself permission to just be.
This isn't wasting time - it's creating space to process your emotions and think clearly about your next steps.
During this period, working with a therapist can be incredibly valuable. Look for someone who has experience with sudden wealth or inheritance issues. They can help you navigate the complex emotions that come with receiving an inheritance while processing your grief.
Finding Your New Normal
One of the most challenging aspects of inheriting young is figuring out how this wealth fits into your identity.
Many of my clients worry about losing their motivation or becoming someone they don't recognize.
They wonder if they still belong in their friend groups or if they need to change how they live.
Rather than letting the inheritance completely reshape your life overnight, think about how this wealth can support the person you already are and the goals you already have.
Maybe it means having more freedom to pursue meaningful work, support causes you care about, or create security for your family.
Receiving an inheritance doesn't mean you have to have everything figured out right away.
It's okay to take your time, seek support, and gradually find your way forward.
The goal isn't to be perfect - it's to be thoughtful and intentional about creating a life that honors both your family's legacy and your path forward.
“When you inherit money at a young age, you’re dealing with many huge life changes at once. There’s the profound grief of losing someone you love coupled with the sudden responsibility of managing significant wealth.
It’s like being handed a gift and a curse at the same time.”
What should I do after getting an inheritance?
One of the most common questions I get from young inheritors is deceptively simple: "What should I do with this money?"
While there's no one-size-fits-all answer, I've noticed that the most successful inheritors think about their wealth in three key dimensions: their life now, their future goals, and their responsibility to give back.
Let's explore each of these areas with some specific ideas that have worked well for my clients.
Planning For Now
When it comes to using inheritance for current needs, inheritors should think about enhancing their life's quality rather than just increasing spending. The goal is to create sustainable positive changes rather than temporary luxury upgrades.
For you that might mean:
Paying to have more time
Focusing on education or finding a new career path
Spending more time enjoying the hobbies that bring your joy
Buying a home, or moving into a better fit home
These are highly personal goals that will differ for all inheritors.
Planning for the future
This involves a long-term view of your future goals and the legacy you hope to leave after you’re gone.
Again, inheritors' goals may differ based on their vision for the future, their family composition, and how much they inherited.
The key point is balancing current needs against future desires.
Depending on spending, even inheritors who receive $10 million or more may have to rein in their current lifestyle “wants” to balance out future desires.
Future planning also involves exploring your investments and values and determining what the right mix of growth, impact, and risk is for your assets.
Making an Impact Through Giving
I encourage all Sunnybranch clients to create positive change with their wealth.
This could be through traditional charitable giving, impact investing, exploring the solidarity economy, or supporting the causes you care about in a different way that feels meaningful to you.
The key to using your inheritance meaningfully is aligning it with your personal values and vision.
Take time to reflect on questions like:
What problems in the world bother you?
What skills or interests do you want to develop?
What solutions do you want to know more about?
How do you want to be remembered?
The most important thing is to move forward thoughtfully and intentionally.
Don't feel pressured to figure everything out immediately.
It's okay to start small, experiment, and adjust your approach as you learn what works best for you.
Your inheritance can be a powerful tool for creating the life and impact you want - but only if you take the time to use it wisely.
What do I do if my inheritance is in a trust?
If you've just learned you're a trust fund beneficiary, you might be feeling an uncomfortable mix of confusion and overwhelm.
Trust funds often come with complex legal documents, unfamiliar terms, and new relationships to navigate.
Let's break this down into plain English and help you understand what being a trust fund beneficiary actually means.
Understanding Your Trust
Think of a trust as money that isn’t really yours, but that you can use.
Instead of receiving an inheritance outright, funds are held in a trust and managed according to specific rules.
These rules were set up by the person who created the trust (usually your parents or grandparents) to protect and preserve the wealth for you and potentially future generations.
These rules are enforced by your trustee, who will determine what level of access you have to funds from your trust.
Your Trust Fund Team
Let's talk about the people involved in your trust.
The most important relationship you'll have is with your trustee.
Think of them as the manager of your trust - they're legally required to follow the trust's rules and are in charge of determining if your requests for money are “reasonable” based on the trust document and the amount of money held in the trust.
Your trustee might be:
A family member
A professional trustee at a bank or trust company
A trusted family advisor
A combination of the above (called co-trustees)
Many of my clients initially feel awkward about their trustee relationship.
It’s like having a financial parent when you’re already an adult, so feeling awkward is totally normal.
The key is understanding that trustees aren't there to control or judge you - they're there to help protect and manage your inheritance according to the terms of your trust document.
Understanding Your Access to Funds
One of the first things you'll want to understand is how and when you can access money from your trust. This varies widely depending on how your trust was set up.
Common structures include:
Regular Distributions: Many trusts make regular payments to you (monthly, quarterly, or annually). This is like having a trust-funded salary.
Milestone Distributions: You might receive larger portions of your trust at certain ages or life events. For example, getting 1/3 at age 25, 1/3 at 30, and the rest at 35.
Discretionary Distributions: This means your trustee can approve additional distributions for specific purposes - like education, starting a business, buying a home, or maintaining your current standard of living.
Working Successfully with Your Trustee
Building a good relationship with your trustee is crucial.
I recommend my clients to approach this relationship like a partnership.
Your trustee has valuable experience and legal obligations to fulfill, but they also need to understand your goals and needs.
The most successful trust beneficiaries I work with take a proactive approach.
They schedule regular check-ins with their trustee, come prepared with clear requests, and maintain open communication about their plans and goals.
When making distribution requests, be specific and thorough.
Instead of saying "I need money," try something like "I'd like to request $50,000 for a down payment on a home. Here's my budget, the property details, and how this purchase aligns with my long-term goals."
Let’s take the next step together
Understanding the questions you need to ask after inheriting is not easy. Inheritors can encounter a wide variety of different situations requiring knowledge and finesse to manage. If you need more help, you can download The 20 Inheritance Terms You Need to Know, or reach out to Katherine Fox, CFP® and CAP®, a fiduciary, fee-only financial planner to learn how Sunnybranch can help you build a plan to manage, grow, and protect your inherited investments.
