Australians are set to inherit huge amounts of money. Here's what to do with it
And so for generations of Australians, managing inheritance will be a significant aspect of overall wealth management, and it won't be as simple as buying a bunch of stocks in a couple of tech start-ups and waiting for the money to multiply.
Put the money in a high-interest account and wait
The worst thing you could possibly do after inheriting any amount of cash is to spend it quickly.
Dawn Thomas, a Perth-based financial adviser, says that often people feel an urgency to decide about what to do with money they inherit, and are often under the impression that not doing something is wasting it.
'Sometimes people feel that they have to make a decision really quickly when they receive an inheritance, but it's OK for funds to stay in a bank account, in a high-interest bank account for 12 months to two years while you make up your mind,' she says.
'You would expect there's some sort of emotion there as well because someone's lost someone that they've loved, and that [might] not be the best scenario for you to actually be making financial decisions. Sometimes, time is your best friend in being able to actually understand what you want.'
Identify what you want and what you can live without
Though it seems obvious, Thomas says writing down your goals is an important first step when inheriting a large sum of money. The exercise carves out time to consider how satisfied you are in various parts of your life and size up how important each is to you.
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