Inherited money
I recently inherited 15,000 dollars and would like to know what the best options are for this money. I am 42 years old, married, and have an 8 year old daughter and a 5 year old foster son. My husband is an independent contractor with no retirement set up. I am wondering if I should put this money into a retirement fund for him or into a college fund for me daughter .
Any advice with help.
Terry Says
Pardon me for being cynical — but I’ve been around for a long time. This is an inheritance –and you need to keep it separate from your husband’s money, or your joint money. For the most part, it should stay in YOUR name.
If you’re working and have no retirement plan, I think you should put $5,000 in a Roth IRA. Call Fidelity at 1-800-FIDELITY after the new year, and they will help you set it up.
If you think your daughter or won will go to college, then I’d take $5,000 and open a 529 College Savings plan. If you live in Illinois (where most of my readers/viewers live) then go to www.BrightStart.com to open the account You don’t have to be an investment genius. Just tell them your daughter’s age and they will invest appropriately for you. If not in Illinois, go to www.SavingforCollege.com and check out the ratings for your state plan. You can invest in any state plan, and Illinois ranks highly.
Then, take the last $5,000 and go to a different bank than where you keep your household savings Open a money market deposit account in YOUR OWN NAME. You’ll earn a little bit of interest, but will always have access to that cash in an emergency. Do not let them talk you into anything else. And if you aren’t working, put the entire $10,000 into that account.
Then please write back to me in a year. Don’t let the money “burn a hole in your pocket” in the meantime. There is always a “good use” for money — but the better use is to keep it in reserve.
