Younger inheritors are especially susceptible to lack of understanding about how much money is a lot, versus how much is enough to live modestly, says Jason Flurry, president of Legacy Partners Financial Group in Woodstock, Ga. "They don't have a concept of how far the money can go," he adds, often leading to expensive purchases such as boats or homes that require ongoing maintenance and tax payments that can erode an inheritance fast.
The key is to maintain a separation from the buzz around celebrities and think strategically about your own goals and lifestyle, says Flurry
One size doesn't fit all when it comes to financial planning.
"Inheritors need to sit down with someone who doesn't have an agenda or a product to sell, who can help them identify their goals and develop a plan," he
"There's no straight-up answer, but you have to be honest" when someone approaches you for a loan, says Flurry
Leave emotions out of it and remember to take care of yourself first, he
This is where a plan can really save your neck.
To avoid making a loan, you can explain that the money is earmarked for other expenses, specific charities, or that it's locked up in trusts.
But if you do decide to lend money, he
adds, make sure each party is clear on the terms and have them in writing.