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Should you keep a large inheritance a secret?

The gift of an unexpected or large inheritance can be so helpful to a Kentucky resident's life. However, many recipients of inheritances have a lot of question about the best way to go about managing them. One common question that we hear relates to whether inheritance recipients should disclose to family and friends that they received the money.

In a recent question to the "Moneyologist" at Market Watch, a reader recounted the incredible story of receiving the unexpected gift of $100,000 after the death of his wealthy uncle. The uncle's wife flew to him in the family jet, landed at the local airport and hand-delivered him the check. He then took her out to dinner before she left to meet up with his brother and sister.

The man asked some questions about the money. Specifically, he wanted to know if he should keep it a secret from his adult children and his financial advisor. The advice was fairly straightforward. The money advisor suggested to the man -- who already told his wife -- that he had no obligation to inform his children of the inheritance. By not telling them the money manager suggested that there would be less chance that his children would act in a greedy fashion and ask for a share of the money. On the other hand, the Moneyologist did advise the man to inform a trusted financial advisor. He recommended that a financial advisor would be able to tell him if he could afford to spend the money, if he should save it for his retirement, and how he should best manage his windfall.

Whenever a large inheritance is received, there also may exist tax questions and other legal issues. Therefore, Kentucky residents may want to discuss what to do with their inheritances with a qualified estate law attorney in addition to their financial advisors.

Source: Market Watch, "Should I keep my $100,000 inheritance a big secret?," Quentin Fottrell, June 10, 2016

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