Disabled Sister’s Inheritance

Terry Says

I can give you the easy answer about where to put the money safely. But I also think this is the opportunity to do some financial planning. She is only 67. Depending on her disability, she could easily outlive that $400,000 windfall. (And don’t tell the nursing facility the extent of that windfall!) So perhaps an attorney or financial planner who specializes in these issues would be of help. Please visit www.ProtectedTomorrows.com, where you can get advice on financial planning for the disabled. I highly commend this group.

Now, when the money arrives, you’ll want it deposited into a money market deposit account at your bank. BUT, that account will likely be paying a very low rate of interest. So wait a week, and then open an account at TreasuryDirect.gov to buy US Treasury bills, direct from the government. Here is a link to a recent article I wrote on that subject.

Stagger your purchases. Every two weeks buy $50,000 in 26 week Treasury bills. Check the box to have them automatically roll over when they mature. Leave $50,000 in the money market account to pay her bills for the coming year. As that money gets low, go to your account and “un-check” the automatic rollover box for one set of $50,000 t-bills The money will automatically go back into the MM account. (And along the way, you’ll receive nice interest checks deposited into that account as the T-bills automatically renew.)

This is the ultimate safety and currently the highest rate (roughly 2.5 percent) that you can earn on “chicken money.” And honestly it is very easy to do when you get started– so read the article and get going as soon as the money arrives in the bank account. (And don’t forget about the financial planning.)