When a loved one dies, some of us may expect to inherit money. This could be money tied up in property or funds in a bank. Some of us struggle to know what to do with this inheritance – should you invest it, and if so where? Below are just a few tips on how to handle money that you have inherited.
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Don’t spend it all straight away
There’s nothing stopping you from splashing all the money straight away. After all, it’s your money. However, you may want to consider all the choices that you have rather than splurging half of it on an impulsive shopping spree. It could be money to spend on travel or it could be money to spend on a down payment on a home. Compare all your options before spending your money.
Find out if you have to pay tax on your inheritance
In the case of large amounts of money, you may have to pay inheritance tax. The exception is money that was given to you before your loved one died – this could be money left in a trust or even a property that was transferred over to your name before your loved one passed away. If the money is liable for tax, it could be important that you pay this tax first before spending it all.
Prioritise paying off your debts
If you have debts, it could be sensible to pay these off with your inheritance. It may not be as exciting as using the money for other purposes, but it will save you a lot of money in the future, possibly giving you a lot more disposable income to use. Paying off debts could be particularly necessary if you’re falling behind on payments or it’s affecting your credit score.
Get professional advice when investing
There are many ways you can invest your inheritance from savings accounts to stocks and shares. It could be worth getting professional advice using a service such as Equilibrium so that you can find the best place to invest these funds. After all, you don’t want to gamble away this money or put it in the wrong saver where it may only accumulate minimal interest.
Give money to family and friends
There may be family members and friends that can benefit from the money you’ve inherited. For instance, you may have kids that you can give the money to. If there was conflict within your family, realise that some people may have been deliberately left out of a loved one’s will – if you share your money with these people, realise that it may be going against your loved one’s wishes. That said, it is your decision how you spend your money.
Consider giving some to charity
If you’ve inherited a lot of money, you may feel like giving some to charity. This could be a charitable cause that you feel strongly about or a cause that affected your deceased loved one (a great way of honouring them). Take your time to compare charities that are out there using sites like Charity Choice. You may even consider setting up your own charity if you inherited a particularly large amount of money.
Take a look at the infographic below which has some great data and suggestions courtesy of Annuity.org
Whether you’re keen to move around the corner, or you’re thinking of upping sticks and relocating to a different city, county or country, it’s wise to plan ahead if you’re selling your home. Unless you find yourself in a situation where you need to sell unexpectedly, it’s worth taking a few steps before the for sale sign goes up.
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Sprucing up your property
If you’re preparing to put your house on the market, it’s natural to want to get the best price. Before you invite agents around, or start taking photographs for galleries and brochures, take a tour of the property, note down any jobs that need doing and give your home a spruce. Simple things like freshening up the paintwork, fixing broken doors and cleaning the windows can make a huge difference. It’s also a great idea to clean and tidy up and to declutter.
Many people will judge properties based on aesthetics and the images they see when they look online. It’s also important to note that your home will attract attention when there’s a for sale sign up outside, so enhancing curb appeal is a good idea. Paint the front door, add plants or a hanging basket to make the property more welcoming and tidy up the driveway and front garden.
Choosing an agent and exploring selling options
When it comes to selling your home, there are several crucial decisions to make, including how you’re going to sell the property and which agent you’re going to choose to market your home. Most people sell through estate agents that manage viewings and the negotiation of offers, usually over a period of time, but auctions are becoming more popular. If you’re keen to sell quickly, or you want to maximise your chances of getting a good price and wrapping up the transaction without any ups and downs and unexpected turns, you might be interested in considering an agents property auction. Some agents deal with auction properties, as well as traditional sales. If you are thinking of selling your home at auction, it’s important to think carefully about setting a reserve. Whichever method you choose, it’s worth doing some research into house prices in your local area and asking a series of agents to provide you with a valuation. The valuation will not dictate how much you get for your home. You might find that there’s a significant difference between the valuation and the offer price, especially if the supply of houses outweighs the demand in your neighbourhood.
Putting future plans into place
If you’re looking to sell, it’s wise to think about and plan your next move. Selling houses can take months, even years, but in some cases, the entire process can be completed in 6-8 weeks. If you’re thinking about buying property, figure out a budget and start searching for houses that match your criteria. If you’re toying with the idea of renting, contact local agents, arrange some viewings and create a short-list.
Before you put a for sale sign up outside your home, take these steps. Hopefully, they will lead to a quick, seamless, stress-free sale.
Claiming benefits of different kinds will help you to maintain an income that supports you and your family. There are some benefits that you might claim when you are out of work, but also many benefits that are available to people in work. When you are claiming any kind of benefit, you’re sure to want to make the most of the money that you receive. It can be very helpful to have that money coming in, but it’s often not enough for you to feel as if you can live comfortably. If you are in receipt of any benefits or think that maybe you should be, there are various ways that you can make the most of them.
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Check You’re Receiving the Right Benefits
The first thing you should do is check which benefits you might be entitled to. There are many different benefits and tax credits, and they are even overseen by different governmental departments. This means that it can all get quite complicated, and you might be unsure which benefits you could have access to. The best thing to do is to use a benefits calculator, which you can find online, or get advice from an advice agency. Citizens Advice is one useful resource that you might find beneficial.
There are several different circumstances that could mean you are able to get help. You might be able to claim benefits if you are disabled or the carer of a disabled person. If you are a parent, you can look into child benefit and child tax credits. If you are not working or have a low income, you may also be eligible for some help. Other circumstances could make a difference too. For example, if you live alone, you can claim a discount on your council tax bill. If you are an older person, you might be eligible for the Winter Fuel Payment.
Claim Benefits While Working
The various benefits that are available aren’t only for people who are out of work. If you are working but still need help with money, you might be able to top your income up in various ways. Some benefits are based on how many hours you work or on your income. For example, you may be able to claim Universal Credit if you are on a low income, or you may be able to claim “new style” Job Seeker’s Allowance if you work less than 16 hours per week. Universal Credit has replaced some benefits for most people. For example, it has replaced Working Tax Credit and Child Tax Credit.
Other benefits available for those in or out of work include Child Benefit. Child Benefit is available for children under age 16 or under 20 and in education or training. However, some of it may need to be paid back if the claimant or their partner earns over £50,000 per year. If you are pregnant, you might also be able to access the Sure Start Maternity Grant if you already receive other benefits, and you are expecting either your first child or a multiple birth.
Know How to Manage Your Benefits
When you receive benefits, it’s also very beneficial for you to understand how they work and how you can manage them. This isn’t always easy, but it’s often necessary to avoid getting caught out. Not only will it help you to know what you’re entitled to and what your rights are, but it will prevent you from accidentally spending overpayments and make sure you know what to do if any of your benefits are stopped. It’s important to know how you can manage your benefits, for example through using an online account, as well as who you need to inform if you ever have a change in your circumstances. You should know who to contact if you ever have an issue or need to query any decisions.
Appealing a Decision
Sometimes you might apply for a certain type of benefit, and your application might be rejected, or you might be awarded less than you think you are entitled to. When this happens, you might need to appeal the decision. Before you can appeal, you need to ask for your decision to be looked at again. This is known as a mandatory reconsideration. Within one month of receiving this, you will need to appeal to the Social Security and Child Support Tribunal. After submitting an appeal, you can provide evidence, and the appeal will be decided at a tribunal hearing.
Avoid Overpayments
One issue to be aware of with many types of benefit is overpayments. If you are accidentally overpaid, you will be required to repay the money. An overpayment might occur because you haven’t told the relevant body about a change in your circumstances. It could also happen due to a mistake by the other party. However, if you receive any overpayments, you need to correct the issue as soon as possible. This is why it’s also important to know how much money you should be getting and when. It will allow you to notice when you might be paid too much and question the amount.
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Understand How Income and Savings Affect Your Benefits
It’s also necessary for anyone who receives benefits to understand how your income and savings will affect your benefits. If your income rises or drops, it could mean the amount you receive in benefits changes. Even having savings can make a difference to what you are entitled to. If you have savings of up to £6,000 (or £10,000 if you are over state pension age), it won’t affect any claims. If you have savings between £6,000 and £16,000, everything above the lower amount is treated as a monthly income of £4.35 for each £250. If you have more than £16,000 in savings, you won’t be entitled to any benefits affected by savings.
Create a Budget
Having a budget is always helpful, but it can be especially useful if you receive any benefits. A good budget will help you to make sure that everything you receive is put to work, and that all of your essential expenses are covered. It can be worth spending some time looking at your essential outgoings, including rent, utility bills, food, clothes, and anything else that you need to pay for day-to-day. When you create a budget, it can help you to find the different ways you might be able to save money. You will get a clear picture of the money you have coming in and going out.
Get Help with Home and Transport Costs
There are many ways you can access help with various expenses at home and transport costs. For example, the Winter Fuel Payment can help you with energy bills during the cold winter months. Another way you might be able to get help is through the various transport schemes. If you receive the higher rate PIP or DLA payment, you can use it for the Pentagon Motability Scheme or similar. There are also railcards and bus passes, for example for disabled people and pensioners. You might need to be receiving other types of benefit to access some of these schemes.
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Benefit from Free NHS Services (Dentist, Optician, Prescriptions, Etc.)
When you are receiving some types of benefit, you might be eligible for free health care when you otherwise would have to pay. For example, if you are receiving some types of low-income benefits, you don’t have to pay for dental treatment with an NHS dentist. You can also access free eye tests, as well as free prescriptions. It’s important to note that the criteria are different for people receiving Universal Credit. To be eligible for help with healthcare costs, you need to have had no earnings or had net earnings of £435 or less in your last assessment period, or £935 or less, depending on your circumstances.
Look for Discounts and Concessions
Receiving certain benefits, or the reason you receive those benefits could also help you to access discounts in other areas too. For example, many venues or shops will offer discounts or concession prices to disabled people and their carers or to people on low incomes. One example is that many arts venues want to encourage people from lower-income backgrounds to attend performances and exhibitions, and so offer discounted prices to make it possible for more people to attend.
Find Other Services Your Benefits Will Help You to Access
You may also find that your benefits entitlement can help you to access other services if you need them. This can include being able to attend a food bank, for example, if you need an emergency food package. You might be able to access grants from charitable trusts to help with other expenses, such as your utility bills. There are various organisations that are not run by the government, but that do offer their services to people receiving benefits. You can even get help with vet treatment from PDSA.
Make the most of the benefits that you receive by educating yourself and getting a good understanding of the benefits system. Once you know what you should be receiving, you can plan to spend it wisely.
Life always brings surprises, some of them good, some of them not so good, and many of them that require some financial input from you. That’s why it’s so important to plan, as best you can, for life’s unexpected events. By preparing now, you can ensure that those tough financial moments are a little easier to deal with when they do arrive…
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Insure for What You Can
These days we have insurance for everything from a broken phone to pet illnesses and even life insurance that will only pay out once we die. If you’re serious about planning for life’s unexpected events, financially at least, it’s a good idea to take out as many insurance policies for as many of the biog issues that are likely to affect you as possible. That way, when the worst happens, you won’t have to worry about the financial side of things at all.
Start an Emergency Fund
Sure, payday loans are available to many people at a push, but when those financial emergencies come around unexpectedly, it’s a never a bad idea to have a pile of money set aside to deal with them. That’s where the humble emergency fund comes in. Basically, an emergency fund is simply an amount of money that you set aside and do not touch until a serious financial emergency comes along – things like job loss, huge vet’s bills or a period of illness. Thus, emergency funds only work when you put money aside regularly and leave it untouched until it is really needed.
Stay Out of Debt
It may not always be possible, but the more you can do to stay out of debt the better Not being in debt means you will have more money available to deal with life’s emergencies and one less thing to deal with. Debt is the source of so much stress that it is worth staying out of it, or if you already have debts, looking at ways to minimise them as soon as possible. If that’s something you are struggling with, there are people who can help you.
Have a Backup Budget
Creating a backup budget, that you can fall back on when your life doesn’t go as expected is a really good idea. It will help you to immediately identify the expenses you can cut back on so that you can free up some much-needed cash and get back on financial track as soon as possible when things get tough. Make that plan now when you’re in a good place and thinking clearly, and you can spring into action right away.
Make a Will
None of us likes to think about dying, but the fact is we will all die one day and when that happens, we don’t want to leave a financial mess behind us. That’s why every adult should make a will as soon as possible. Then, if the worst does happen, those who are left behind will know exactly what is expected of them and where the money will be going.
Plan now and cope better when those unexpected life events show up!
One of the things that most of us tend to struggle with is thinking about what the future holds for us. Now, this is actually pretty understandable. Without the ability to see the future, most of the time we’re just making our best guesses at what it holds. However, this leads to a lot of people choosing to ignore it entirely and just focusing on the present tense. This is a mistake. The trouble is that the future has a tendency to sneak up on you pretty quickly and if you’re not ready for it, that can be pretty scary. With that in mind, here are some ways that you can start planning for the future.
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Saving
The most obvious and simplest way that you can start planning for the future is to start putting some money away in a savings account for a while. Most people assume that they don’t have a large enough income to start saving but this simply isn’t the case. The truth is that, even if you’re just putting away a tiny amount here and there, that can make a huge difference. Whether it’s with the intention of handing money over to family, or funding your own move into a community like Enterprise Retirement Living when the time comes, setting money aside now with a future goal in mind can make a big difference when it matters. You’d be truly shocked at just how quickly those little bits of money can start to add up over time.
Your career
It’s easy to find yourself stuck in a run when it comes to your career. After all, there are plenty of things in modern life that make it pretty easy to fall into a job that you don’t really care about. However, one of the things that a lot of people don’t really pay attention to is the fact that they often end up in a position where they’re in a job that’s just not going anywhere. Sure, it might pay the bills but it doesn’t offer them the chance to grow or develop over time. When it comes to your career, it’s always a good idea to not just think about what it’s like now, but how it can help you move forward into the future.
What happens next?
It’s pretty understandable that most of us don’t really want to think about the potential of something happening to us. Leaving behind the people in our life is a sad and scary prospect. However, it’s something that’s worth thinking about, especially if you have a family. Whether you’re making a will or planning for things like inheritance tax, working with wills & trusts solicitors can make that a whole lot easier. Planning for what happens next is never fun, but at least with the right support, you can make it at least a little bit easier.
Of course, none of this is to say that you should spend all of your time thinking about the future to the point that you miss out on what’s right in front of your nose. The key to living your best possible life is finding that balance between living in the moment and making sure that you’re making plans and allowances for the ways that things might go in the future. This isn’t always easy but it’s by far the best possible way to make sure that you don’t end up with any nasty surprises in life.
