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So You Inherited a Large Sum of Money… What’s Next?

According to a recent report by Accenture, approximately $30 trillion will pass from one generation to the next over the next 30 years. Baby boomers alone are starting to receive an estimated $8.4 trillion in inheritances from older generations. Could you be receiving a significant inheritance? If so, how do you plan on handling the funds?

One consideration to think about if you are bequeathed significant assets is to first deposit the funds in a money market fund or certificate of deposit. These types of accounts are liquid, meaning you can easily withdraw the funds once you know how you would like to use your inheritance. It also may be prudent to spread your money among multiple banks as FDIC insurance limits for interest-bearing accounts are $250,000 per depositor at each financial institution.

While your inherited assets are in a safe and accessible place, be sure to consult your financial advisor. Why? He or she can offer a comprehensive review of your altered financial position and provide solutions and strategies that are appropriate for you.

And, you cannot forget about Uncle Sam. Federal and state estate taxes might be significant if you inherit a large estate. However, there are certain tax benefits to receiving inherited assets. For example, if you inherit securities, your tax basis includes a “step-up” in basis to the value on the day your loved one died. Whenever you decide to sell the securities, any capital gains earned while your loved one held them will not be taxed.

Finally, keep in mind that your inheritance was received likely due to the directives included in the estate plan that your family member had in place prior to their death. No one likes to think of their own death, but it is important to have an estate plan for yourself set in place sooner rather than later. You will gain peace of mind that your affairs will be attended to in the manner you see fit.

For questions on how to handle an inheritance, contact Mark Anderson at 312.670.7444. Visit to learn more about our Wealth Management Group.

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