Why Trusted Advisors Are Essential When Navigating a Major Inheritance

The death of a loved one is a sad time when family members support each other, deal with their grief and navigate new family dynamics.

When death results in a significant inheritance, mourning can be followed by a time of important decision-making. How should the new wealth be managed?  What decisions should be made about hard assets like farmland and real estate? How can this wealth guarantee our retirement and our children’s and grandchildren’s future?

By nature, the decisions that must be considered when a large inheritance is received are decisions that beneficiaries have never had to make before. You are treading new ground, with money and assets that once belonged to someone you may have loved and respected, and whose wishes you want to honor.

There is no need to think you’re going through this experience alone. Working with a trusted advisor is an important step to managing your inheritance in a way that minimizes taxes, achieves your goals and any wishes your deceased relative may have expressed, and provides for your family’s future.

Your advisor will help you navigate the inheritance from multiple aspects:

  • Minimizing taxes
  • Generational estate planning and trusts
  • Investment management

The goal is to minimize taxes, preserve wealth and build a long-term legacy. These are important concepts with long-range impacts, so it’s important to understand that this experience is the beginning of a long — perhaps lifelong — relationship with your advisor. Working with someone you know and trust will help you get on the same page in terms of communications, priorities and decision-making.

Thoughtful planning now can turn a sudden influx of wealth into long‑term security and generational benefit.

One Family’s Story

The Stewart family was saddened by the sudden passing of Cheryl Stewart’s father, Jim. But Jim had prepared his estate plan and shared the details with Cheryl and her husband, John, both business owners in their mid-50s who had just begun to consider their own estate plans.

As Jim’s only heirs, the Stewarts inherited a large estate that included cash assets, investments, real estate and farmland, as well as farm equipment, vehicles, a classic 1956 Chevy Bel Air and some valuable personal belongings, including paintings and watches. It was a significant transfer of generational wealth.

The Stewarts worked with their wealth advisor to achieve multiple goals, including:

  • Transferring the wealth in a tax-free manner, which included setting up a donor-advised fund to continue a gifting legacy Cheryl’s parents began, as well as purchasing a lake home for Cheryl’s family and future generations to enjoy, just as she did while their parents were living.
  • Setting up estate planning and trust services for Cheryl and John’s children and grandchildren to build an intergenerational legacy and continue the family history of philanthropy.
  • Using inherited IRA assets to give to the Parkinson’s Foundation through a Qualified Charitable Distribution (QCD), which made the IRA distribution non-taxable.
  • Addressing the inherited assets in a way to shift to a more suitable investment strategy for Cheryl and John.

Cheryl and John continue to work with their wealth advisors and estate advisors as their family’s needs change. The strong relationships they have developed have helped them not only steward the wealth left to the family by Cheryl’s father, but also develop their own sense of philanthropy and legacy.

Whether a significant influx of assets, such as an inheritance, is anticipated or sudden, working with a team of wealth advisors and estate planning professionals is essential to help minimize taxes, preserve wealth and build a long-term legacy.

Adams Brown Wealth and Estate Planning advisors are ready to help. Contact us today!