Have you recently received an inheritance from a relative and wondered how to use it? Financial expert Rani Jarkas shares some of the best advice on what to do with inheritance money:
- Build your emergency fund.
If you do not have one already, the first thing you should do with your inheritance is to build up an emergency fund. This is a rainy-day fund that you can tap into in case of unforeseen circumstances, such as job loss or medical emergencies.
Ideally, your emergency fund should be able to cover at least 3-6 months of your living expenses. This will give you peace of mind knowing that you have a safety net to fall back on during tough times.
- Pay your debts.
It is true that a life without debt is a life more abundant. If you have outstanding debts such as credit card debts or student loans, one of the best things you can do with your inheritance is to use it to pay them off. Not only will this free up more cash flow each month, but it will also help you save on interest payments.
- Pay down your mortgage.
One of the greatest stressors in life is having a mortgage. If you have the opportunity to pay down your mortgage with your inheritance, it is worth considering. This reduces the amount of interest you have to pay over the life of the loan while also helping you become mortgage-free sooner, providing peace of mind and financial freedom.
- Invest in yourself.
Finally, one of the best things you can do with your inheritance is to invest in yourself. This could mean anything from taking a much-needed vacation to finally returning to school to get that degree you have always wanted.
Investing in yourself is a great way to use your inheritance because it will help you improve your life in both the short and long term. Not to mention, it is a great way to honor the relative who left you the inheritance in the first place.
No matter how large or small your inheritance may be, Rani Jarkas believes that these are some of the best ways to use it. What matters most is that you make wise decisions with the money so that it can benefit your life in the long run. Keep these tips from Rani Jarkas in mind, and good luck!