Receiving an inheritance is one of those life events that comes with a complicated mix of emotions. Grief, gratitude, maybe a little overwhelm, often all at once. In the middle of processing all of that, you're suddenly faced with big financial decisions.
The people we work with here in Montana often come to us in exactly that moment. They’re not sure where to start, what's required of them, or who to trust. If that's where you are right now, this is for you. You don't have to figure it out overnight.
Give Yourself Permission to Pause
One of the best things you can do when you receive an inheritance is nothing, at least for a little while. No rule says you have to invest, spend, or do anything with the money right away. Park it somewhere safe, like a money market or high-yield savings account, take a breath, and give yourself time to think clearly before making any big moves.
The decisions people make in the first few weeks after a loss are rarely their best ones. Most financial moves can wait a month or two, and giving yourself that space usually leads to better outcomes.
Get a Clear Picture of What You've Received
Not all inheritances look the same. You may have received cash, a brokerage account, a retirement account like an IRA, real estate, or some combination. Each one comes with its own rules, tax implications, and timelines.
Inherited IRAs come with specific distribution requirements under current law. In most cases, you'll need to withdraw the full balance within 10 years, and missing those deadlines comes with penalties. Before you make any decisions, make sure you understand what you've inherited and what's required of you.
Think About Taxes Before You Spend
This is where you can be caught off guard. Depending on what you've inherited and how it's structured, there may be real tax consequences to certain decisions.
Montana does not have a state inheritance tax, which is good news, but federal rules still apply. Inherited IRA distributions count as taxable income in the years you take them. Selling inherited property may trigger capital gains taxes, though the stepped-up basis rules often work in your favor, meaning you may owe less than you'd expect. A conversation with a financial advisor or CPA before you act can save you a significant headache later.
Pay Off Debt, But Be Strategic About It
If you've been carrying high-interest debt, an inheritance can be a real opportunity to get out from under it. Not all debt is worth rushing to eliminate, though. Low-interest debt like a mortgage may not need to be your first priority.
Think about where paying something off would actually change your day-to-day life, your monthly cash flow, your stress level, and your options. A credit card at 22% interest is a very different conversation than a 30-year mortgage at 3.5%.
Connect It to Something You Already Care About
An inheritance is a chance to make progress on goals you've been working toward. Maybe that's retirement savings, funding a grandchild's education, building an emergency fund, or making a charitable gift that mattered to the person you lost.
We've seen people use an inheritance to finally retire on their own terms. We've seen others use it to pay off a child's student loans or give to a cause that defined the person who left it to them. There's no single right answer, but there's usually one that feels right for you.
If Other Family Members Are Involved
When an inheritance involves multiple heirs, siblings, family members, or a blended family situation, things can get complicated quickly. Decisions about shared assets, how to divide things fairly, or whether to sell a family property often carry emotional weight that goes beyond the financial side.
Having a neutral third party involved can help. Someone who can walk through the financial pieces objectively and keep the focus on decisions rather than dynamics. It's one of the more underrated parts of what a good financial advisor does.
You Don't Have to Figure This Out Alone
Inherited money comes with real decisions and real consequences. There's no shame in asking for help, and it's usually the smartest move. A financial advisor can look at the full picture, taxes, investments, estate planning, your existing goals, and help you make decisions you feel good about.
If you've recently received an inheritance and aren't sure where to start, we're happy to talk it through. No pressure, no jargon, just a straightforward conversation about what makes sense for you.