If you receive an inheritance from a relative it can be difficult to know what to do. Here at Charters Private Wealth, we think it’s a good idea to take a step back and think about the best way to use it. Depending on how much you receive and your personal and financial circumstances, it might be sensible to pay off your debts, or even invest it.
If you have personal loan or credit card debts, it’s usually beneficial to use your inheritance to repay these first. This is because the interest you pay on this unpaid debt is typically much higher than any interest you earn on a savings account. Once you’ve repaid these liabilities, you’re in a much better position to invest. You might even want to start building an emergency fund to protect you and your loved ones even more.
Another option is to put your inheritance into an easy access savings account. This is a great idea if you think you might need the money in the short term. However, if you don’t need it for a good while, you could invest your inheritance and with careful planning, benefit from a potentially higher return.
If you’re in any doubt over what to do, why not watch our video to learn more?
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
If you receive an inheritance the Financial Services Compensation Scheme (FSCS) protects your balance for up to £1 Million for a six-month period. After this, it reverts back to the standard £85,000 per individual, per authorised institution so it pays to spread the money.
If you have any questions around this topic, please feel free to get in touch with us directly on 01789 263888 or email firstname.lastname@example.org.