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Learning, Sharing, and Teaching => Investor Alley => Topic started by: Bethany J on April 14, 2012, 05:34:23 PM

Title: What To Do With Inheritance?
Post by: Bethany J on April 14, 2012, 05:34:23 PM
Curious to get opinions on what to do with an inheritance! Background: My husband will be inheriting in June around $50K. We have no debt including the mortgage. I am a stay at home mom with part-time hobby on Ebay and in my booth.  My husband contributes the maximum to his retirement and puts money in savings, etc. Kids college is taken care of by my father. Our total gross income is approx. $100K. He will be able to retire in 6 years (age 47) with a pension of approx. $40K a year and plans to get another job. We plan to live on the pension and save his other salary. So retirement seems to be taken care of. We have been debating whether to:

Put in savings and forget about it
Invest in a Vanguard or similar fund
Buy a rental property
Spend part of it on a new deck and fence

Any thoughts?
Title: Re: What To Do With Inheritance?
Post by: HeidiO on April 14, 2012, 06:59:43 PM
   I got a $90,000 inheritance when I was 23.  Obviously a completely different time in my life than you are in, but this is how I thought of it.  I divided it into 1/3's.  Spent 1/3 on going back to school to become a nurse (basically 2 years of living expenses.  Damn lifestyle inflation!)  1/3 on a downpayment for a house, and put 1/3 in a retirement account, that I recently cashed out to use for downpayments on rentals. 
  There are several moments in my life when I felt my mom was giving me a new gift, when I bought my first house, and everytime I have sold or bought a house since.  Also, when I cashed out the retirement account.  It's a good feeling, like she is still here, taking care of me, loving me.
  I would use part of the money in a way that feels like a gift from your father-in-law to your husband, whatever that is.  That doesn't have to mean in a wasteful way.  It could, though.  For instance, since you already are in a great starting place, maybe you could use some amount for something fun - whatever that looks like to you.  Use it to fund a vacation that takes place on your husband's birthday.  A $300 camping trip or a $3000 cruise, whatever sits best with your family. 
  It's nice to have some symbolism, though.  And a way to keep it seperate from your other money, so everytime you do use it you feel the connection.
Title: Re: What To Do With Inheritance?
Post by: Bethany J on April 15, 2012, 06:58:16 AM
Thanks for the suggestions! The inheritance is from his grandfather, my dad has funded for our kids college, luckily he is still among the living! I told my husband the same thing about doing something wiith the money that would remind us of his grandfather. When I suggested the deck or a trip with part of it, he gets concerned that I want to go on a spending spree. I just don't think having all of it in a fund or savings or whatever is honoring him as much.
Title: Re: What To Do With Inheritance?
Post by: ErikZ on April 29, 2012, 09:40:30 AM

Your biggest problem right now is that none of your options seem very attractive to you. :-)

I'd invest it in something that doesn't lock your money away from you.

That way, when you see a business or a property you want to buy, you can liquidate your other investments and go for it.
Title: Re: What To Do With Inheritance?
Post by: MsLogica on April 29, 2012, 03:01:25 PM
Good question! I will be coming into some inheritance this year and I've been planning how to use it too.  I've decided to split it into thirds, as the other commenter mentioned doing.  1/3 into savings, 2/3 into a mortgage.