Don't Blow Your $800,000 Inheritance HD

09.08.2018
Is it really a shocking statement to say that 1 out of every 3 people blow their inheritance? I’ve seen this happen - someone inherits money and it is gone within 3 months to a year. All of the money is gone! It doesn’t matter if it is $25K or $1 million. Somehow these people find a way to blow it. I got a subscriber question from someone that inherited a chunk of money and they want to make sure that they don’t blow it or lose all the money. I wanted to be sure to answer their question but I also wanted to make a video for you. I wanted to share the information so that if you find yourself in this situation, you will be prepared to be able to put that money to work. Not only do ⅓ of people blow their inheritance, but it’s not just average people. Statistics show that with wealthy people, OVER 70% of the wealth transfer doesn’t make it past the second generation. Let’s find out what this reader had to ask: “My spouse and I will be Inheriting about $750,000 to $80,000. The payoff balance of our mortgage is estimated at about $180,000 at 3.5% APR for 30 years. Would it be worthwhile to allocate some of the money we are inheriting to pay off the mortgage loan? ” I told you this was a fat inheritance ¾’s of a million dollars! The only inheritance I ever received was about $8,000 from my grandmother. I used most of that to pay off student loan debt, and some for saving and investing. I can see how tempting it can be to go out and buy things when you get a chunk of money. A new house, new car, new clothes, new computers, etc. But for this reader the biggest question is regarding their mortgage. They are locked in with a great mortgage rate, they can continue to claim this mortgage interest on their taxes. You are probably thinking that I have spreadsheets and I am crunching numbers to see what will be best over the long term. Considering things like investment returns, interest calculations, etc. There was a time when I would do exactly that. Obviously there is risk involved. Now if they do pay off the mortgage, they are debt-free and the return is automatically that 3.5% interest. They still have well over ½ a million dollars that they could use to take a vacation, buy some of the things they need, and invest. So while there was a time that I would crunch the numbers and do the spreadsheets; there are other things that we need to take into consideration. How much do they currently have saved, how much are they able to save, are they putting money in a 401K or Roth IRA? What I have come to realize is that if someone is looking at paying off a mortgage or another large debt vs. investing the money and potentially making a net positive return - what it comes down to is what is your investment personality. What is your risk tolerance? What happens if you make a small percent or lose money in your first year? I see a lot of people doing this. Then the reality is that instead of making a better return by investing, th

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