3 Essential Steps for Women in Their 40s and 50s Relying on Inheritance

If you’re a woman in your 40s or 50s relying on that $100,000 inheritance to sustain you in retirement, you need to do the following three things right now.

1. Ensure a Current Will or Trust

First, make sure your parents or grandparents have an up-to-date will or trust. If they do not, their assets can become intestate and may be subjected to a public process called probate, which can drag on and cost thousands of dollars in legal fees. You might still not end up getting what grandma promised you would always be yours, while potentially leaving room for long-lost Uncle Frank—nobody liked Uncle Frank.

2. Know the Executor or Trustee

Next, make sure you know who the executor of the will or the trustee of the trust is. This is usually an attorney or someone who works in finance. This individual is charged with carrying out the deceased's wishes, making it crucial for you to know them and how to contact them.

3. Understand the Cost Basis Reset

Finally, remember that if grandma or your parents give you any assets that have appreciated greatly in value, the cost basis of those assets resets to the market value at date of death. You can then sell those assets immediately without having to pay capital gains taxes that have been accumulating for decades. So if your parents or grandparents plan to give you any assets before they pass away, you can graciously decline and save them from tax liabilities, ensuring the government takes in less money because of your choice.

As always, do your research, and best of luck!

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