Ask Terry Questions Long Term Investment Strategy

Long Term Investment Strategy

By Terry Savage on June 03, 2023 | Financial Planning / Retirement

My wife and I have recently experienced an unexpected financial windfall when her only brother passed away unexpectedly and left his entire estate to us (approx $1.5 million).

My wife and I are already retired and have a solid, well funded financial plan for our golden years. So, we plan to invest this unexpected money from her brother’s estate in long term investments that will go to our adult children when they are ready to retire in about 25 years (we are concerned that unlike us, who are both lucky enough to have substantial pension income as part of our retirement portfolio, our kids will not be as prepared for a comfortable retirement as we were).

If you were in our shoes, what long term investment strategy or strategies would you deploy for this money?

Terry Says

I would invest this in a diversified portfolio of low-cost mutual funds at Vanguard and/or Fidelity.

BUT, that’s not the real end of the story! Here’s what I would really do in your shoes.
1. Consult my estate planning attorney, make sure I have an updated Revocable Living Trust, and open any new accounts in the name of the RLT.
2. Consider grandchildren — if you already have them — and invest in a 529 College Savings Plan for EACH of them. You can give $17,000 a year (each) OR combine 5 years of the allowable gift into one huge contribution and full fund their college educations. Read this:
3. Meet with a fee-only FIDUCIARY financial planner to consider your own plan in light of this new money.
Read this article.

In the meantime, I would put the money in T-bills. Read this:



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