June 23, 2026
9 min read
You just got an inheritance. Now what?
If you are the recipient of a trust or inheritance, here are 5 things you should consider to help preserve your wealth.
Credit: Becka Kottke
The Love & Money Series
Helping you plan with care for the people and moments that matter
Key takeaways
- Understand your inheritance: Read all documents carefully.
- Build your advisory team early: This can include a trustee or executor, financial advisor, estate attorney, and tax advisor.
- Consider tax implications: Consult with a tax advisor to understand the potential consequences of distributions and sales.
- Make informed decisions: Work with a financial advisor to create a plan for managing your assets.
- Talk to family and friends: Effective communication is key to avoiding conflicts, but be cautious about sharing information to avoid unwanted attention.
When Rebecca [last name withheld] learned she would inherit her family’s farm and other investments after her grandmother passed away, her brain was flooded with questions: “What is expected of me? How do I manage this new wealth? Where do I start?”
Getting an inheritance can be both a blessing and a challenge, and it can take some time to understand what it all means. Melissa Sidor, a private wealth strategist, and Nikki McCain, a senior fiduciary strategist — both with Wealth & Investment Management — share inheritance tips, key steps, and considerations to help you preserve and grow your wealth.
1. Understanding your inheritance
First, carefully read through any trust documents, wills, or other legal papers to understand the terms and conditions of your inheritance and what assets you will be receiving. Understanding how assets will transfer to you depends on the type of legal document or asset, which may include:
- Trusts: These may have specific terms about how and when assets are distributed.
- Wills: Assets typically go through probate, which can be time consuming.
- Inherited IRAs or investment accounts: These have unique tax and distribution rules.
- Real estate or physical property: These can come with maintenance costs or legal complexities.
2. Building your advisory team
Next, start building your advisory team early on. You’ll want to make sure you have people who are looking out for your best interests, especially if you have complex family relationships. “I wanted a strong team looking out for me,” Rebecca said. “One advisor was surprised that I was reaching out while my grandmother was still alive, but I didn’t want to be googling ‘financial advice’ while I was grieving.”
Here’s what your team could look like:
- Trustee or executor: Manages the estate or trust and could be a family member, lawyer, a CPA, or a corporate trustee like Wells Fargo Bank, N.A.
- Financial advisor: Helps you align the inheritance with your long-term goals.
- Estate attorney: Interprets legal documents and helps ensure compliance with state laws.
- Tax advisor: Clarifies any tax implications, especially for trusts or large inheritances.
Then, meet with the executor and/or trustee. Ask for a communication plan that outlines tasks and a general timeline for how long it will take to settle the estate and trust administration. You’re going to have a lot of questions, and that’s OK. Here are some to get you going:
- Am I the sole beneficiary, or are there several beneficiaries of the trust?
- Do I have to reach a certain age before accessing the trust?
- What expenses can the trust cover for me, such as health, education, maintenance, and support?
- Does the trust terminate once I reach a certain age, or is it meant to last for my lifetime?
“Get tax advice before withdrawing any money.”
3. Tax considerations
When you are named as a beneficiary on a tax-deferred account, there can be serious tax consequences depending on how you take a trust distribution. “Get tax advice before withdrawing any money,” Sidor said
Typical options include:
- Taking it outright: You’ll receive the entire inheritance in one lump sum, without any restrictions or conditions.
- Taking distributions held in trust for your benefit: You’ll receive distributions according to the terms set by the trust. This could involve requesting distributions from the trustee, which may be discretionary (meaning you have to ask for it, and it must fall within the trust’s parameters) or mandatory (you receive it automatically, like income).
Note: Estate taxes are paid prior to distributions from the estate.
Read more: What beneficiaries should know about their Inherited IRA | Wells Fargo Advisors
4. Making informed decisions
Rebecca needed professional guidance on whether she should consider renting or selling the land she would inherit, which was essentially the family business. She also wanted to evaluate her current finances, debts, and goals even before receiving her inheritance. “I needed help figuring out what I wanted to accomplish,” she said.
This is where a financial advisor comes in. They can help you create a plan before the inherited assets are distributed, so you know what to do with them, whether it’s investing, maintaining, growing, or pursuing your specific goals.
Now is also the time to think about how this inheritance, no matter how large or small, might impact your own estate planning. For example, McCain said, for an inheritance held in trust, you might have a power of appointment to direct that trust elsewhere upon your death, and that’s something that may need to be updated in your current estate plan. Sometimes, once the estate is settled, a new trust is created with your share of the estate; other times, assets are given directly to you. If the assets stay in trust, the trustee will work with an investment advisor to manage them according to the trust’s terms, making sure your needs are considered.
5. Talking to family and friends
When Rebecca shared her inheritance details, her friend cautioned, “I wouldn’t go around telling people that.” Sidor advised being selective about who you share this information with, as it can attract unwanted attention. “People come out of the woodwork,” she warned.
Effective communication is key to avoiding conflicts, even with modest estates. Be mindful of how and with whom you discuss your inheritance to prevent misunderstandings and disputes. And always be on the lookout for scams and people who may not have your best interests at heart.
Navigating the complexities of an inheritance can be daunting, but with the right guidance, you can make informed decisions and strategic choices about your financial future. Remember, you don’t have to go through this alone. Consulting with a financial advisor can provide you with personalized advice and support tailored to your unique situation.
FAQ
Inheritance refers to the assets, property, or money that a person receives from someone who has passed away. This can include cash, real estate, stocks, bonds, personal belongings, and other valuable items. Inheritance is typically distributed according to the deceased person’s will or trust documents, or, if there is no will, according to the laws of intestate succession.
Take your time, review the documents, and consult a financial advisor, a lawyer, a tax professional, and your trustee to create a plan.
Consult with a financial advisor and estate planner to incorporate the assets into your own estate plan, including a will, revocable trust, power of attorney, health care directive, and beneficiary designations. Read more: Why you need an estate plan, even if you’re not wealthy
It depends on your goals and risk tolerance. A financial advisor can help you decide.
Financial advisors, estate planners, and tax professionals can provide guidance. Trustees manage trust assets.
Get professional financial advice
No matter what stage of life you and your partner are in, a Wells Fargo Advisors financial advisor can help you reach your goals.
