Advice on protecting and growing inherited assets: part II

by | Feb 12, 2014 | Estate Planning |

According to the American Association of Retired Persons, every day across the U.S., an estimated 8,000 individuals turn age 65. This trend is expected to continue for the next several years as individuals who make up the baby boomer generation approach and live out their retirement years. A large percentage of these baby boomers will inherit assets from deceased parents and many will have concerns and questions related to how to protect, invest and grow those assets.

In our last blog post, we started discussing some common issues individuals who inherit assets must consider and decide upon. In this post, we’ll continue to discuss this topic, specifically in relation to personal property as well as provide advice on how to devise a personal investment strategy.

In addition to investment accounts, such as traditional and Roth IRAs, an individual may inherit assets that are held in bonds, stocks and mutual funds. Depending on the terms of a will, assets held in these types of investment accounts may need to be split among several heirs. If this is the case, it’s important to ensure assets are distributed equally. Once assets have been equally distributed, an individual would be wise to meet with a financial planner to devise his or her own investment strategy and ensure an investment portfolio is diverse in scope.

A home or property is another major asset, or potential liability, that is often inherited. If a home is paid off, siblings must decide whether to live in the home, sell it or rent it. If a mortgage still exists, it’s important to ensure payments are current until a decision is made regarding what to do with the home. In cases where a home is vacant, heirs would be wise to install an alarm system and take steps to ensure a property does not remain uninhabited for too long.

For baby boomers that may have lived their entire lives worrying about money, the sudden inheritance of a large amount of assets can be overwhelming. For these reasons, it’s often wise to seek the advice and assistance of an estate planning attorney and financial advisor. These professionals have a fiduciary duty to act in a client’s best interest which includes taking time to understand a client’s estate planning goals and help ensure those goals are realized.

Source: Kiplinger, “Heirs Should Treat Windfall With Special Care,” Susan B. Garland, Feb. 2014, “Boomers at 65,” 2014