How do I decide what to do with this money?

[dock]

My grandfather passed away in the fall, and it’s since been discovered that he and my grandmother had more money than we realized. Some things are still being sorted out, others we have details.

There’s an annuity (I think that’s what it is) that I can either take as a lump sum, or continue the remainder of the payments. The final payout amounts are pretty close, but I think I’ll be taxed differently? I have no idea which is the better choice. It’s less than 10k, if that matters.

I also have to set up trusts for my kids. I don’t know the best thing to do with it.

Any suggestions or resources appreciated!

[mcsangel2]

Take the annuity as a lump sum, you can either opt to have the taxes taken out at that time, or get the entirely of the remaning money and pay taxes on it when your GFs final taxes are filed.

How's your savings/emergency money? I inherited about $16k from my mom after we settled her estate. I didn't really feel like it was enough money to change my life, so it's been sitting in a separate savings account since then and we'll use it as part of a down payment if/when we ever move to a bigger house.

[notsopicky]

I agree w/ mcsangel2. Aside from savings/emerg $, what are your MM goals?

Pretty much the same thing happened to me with my grandfather. We received 2 payments, each a little less than 5 figures, and we saved both in a separate savings account. One went to part of our DP on our new house, and the other is STILL sitting in a SA, for a trip to Europe. He would be proud of us that we used the $ for "something big", something that he would love that we did/are doing for ourselves.

He also gave me a stock portfolio when I was 21 that I saved until I was 31, in order to use for my DP on my first house. My first call was to him the day we closed. He couldn't believe that I had saved that thing for so long--every other grandchild in the family (he gave one to each GC), save my brother, had "pissed theirs away". I was pretty proud of myself that day, and he was proud of me too.

What might your grandfather have wanted/loved to see you do with this money?

[dock]

notsopicky I also still have a portfolio (mutual fund? I don’t even know, it’s kind of embarrassing) that they opened when I was little and mostly haven’t touched because I don’t know what to do with it and I’m scared of the taxes.

I know for sure there’s one other larger amount of money (large to us, not life changing in the grand scheme) that I think will be a lump sum - DS and DD will be getting the same amount each, and will need to go in a trust.

We already own a home. Realistically it all should go in savings of some sort (relatively easily accessible if we need it). We’re 99% sure we’re making the not-MM decision to have me quit my job and SAH starting later this spring, and some extra cushion will help. Otherwise we don’t really have an MM goal. I’m not sure what they’d want me to do with the money, honestly. Something family related, and more great grand kids. lol

I just don’t want to screw us long term (or even on taxes one year hugely) by doing the wrong things with any of it.

[gt7301b]

I'd schedule time with a financial adviser to go over all the pieces of inheritance and make sure you are taking into account all of the different tax angles with the multiple sources. You can hire a financial adviser by the hour to do a review for you.

www.napfa.org/
clark.com/personal-finance-credit/investing-retirement/fee-only-financial-planner/

[mcsangel2]

If you don't already have a comfortable amount in emergency savings, that's where I'd put it.

[Roc A Bee]

Do you have debts? How’s your savings?

[dock]

Jan 29, 2020 18:10:51 GMT -5 Roc A Bee said:

Do you have debts? How’s your savings?

The only debt we have is my SLs and our mortgage. It won’t be enough to pay off that, from what it sounds like. We have moderate savings, but could probably have more (especially if I really do end up SAH).

[Roc A Bee]

Jan 29, 2020 20:09:22 GMT -5 dock said:

Jan 29, 2020 18:10:51 GMT -5 Roc A Bee said:

Do you have debts? How’s your savings?

The only debt we have is my SLs and our mortgage. It won’t be enough to pay off that, from what it sounds like. We have moderate savings, but could probably have more (especially if I really do end up SAH).

I’d spend half and save half. Maybe take a nice vacation or buy something special.