What to do when you have received an Inheritance?

Receiving an inheritance can be life-changing. Whether modest or substantial, it often arrives during a time of grief and emotional upheaval. Understandably, many people feel uncertain about how to manage a sudden influx of wealth—unsure of what’s required now, what can wait, and how to make the most of what’s been left to them.

At Independent Wealth Partners, we’ve helped many clients navigate this transition. An inheritance should support your values, align with your long-term goals, and—above all—respect the legacy of the person who left it to you.

1. Pause Before You Plan

Grief can cloud judgement. That’s why one of the most important first steps is simply to pause.

There is often no need to rush. In most cases, financial institutions, estate executors, and even tax authorities provide a grace period for beneficiaries. Use this time to process the emotional impact of your loss and avoid making any big financial moves you might later regret.

During this stage, keep things simple. Ensure bills are paid, important documents are kept in one place, and you’re informed about the estate settlement process. But avoid major lifestyle changes or investments until you feel more grounded.

2. Understand What You’ve Inherited

The form of your inheritance can significantly impact how you manage it—and how much of it you retain.

Inheritances can include a wide range of asset types, each carrying different tax treatments, legal responsibilities, liquidity constraints, and strategic implications. Before making decisions, it’s critical to gain clarity on what you’ve received, how it’s structured, and what that means for your financial future.

Cash

Typically tax-free in Australia, inherited cash gives you flexibility—but it also requires discipline. Consider how it might affect Centrelink entitlements or future tax obligations depending on how it’s used or invested.

Tip: Park the cash in a high-interest savings or offset account while you make longer-term plans.

Property

Inheriting real estate—whether a family home or an investment property—introduces decisions about CGT, maintenance costs, tenancy, or potential sale.

Tip: Get a professional valuation at the date of death to establish a cost base for tax purposes.

Shares or Investments

Inherited investments often receive a reset cost base (market value at the date of death), making timing and strategy critical. Assess whether the portfolio suits your goals and risk profile.

Tip: Seek advice before selling; you could preserve tax benefits or reposition strategically.

Superannuation

If you’re a dependent, you may receive a superannuation payout tax-free. If not, taxes up to 17% may apply to the taxable portion.

Tip: Understand whether a lump sum or income stream is more appropriate for your situation.

Business Interests

Inheriting private business equity can introduce complexity—valuation, control, succession plans, and legal agreements all come into play.

Tip: Review company structures, shareholder agreements, and seek legal and accounting advice early.

Trusts

If you’re a beneficiary of a testamentary or discretionary trust, you may not control the assets, but you may benefit from income distributions.

Tip: Obtain the trust deed and clarify your rights with an advisor.

3. Define Your Goals Before You Spend

Your inheritance should serve your life—not the other way around.

An inheritance can feel like a safety net—or a springboard. But without a clear sense of direction, it’s easy to let the opportunity pass by or make short-term choices that don’t serve your future.

Your decision about what to do with your inheritance should begin with a deeper reflection on your personal goals, dreams, and aspirations. This is more than just paying off debt or buying a new car—it’s about building a life that’s aligned with your values and what matters most to you.

Take time to ask yourself:

• What does financial freedom look like for me?

• Are there things I’ve always dreamed of doing—starting a business, changing careers, travelling, or supporting a cause?

• Do I want to help my children or grandchildren get ahead through education or home ownership?

• Am I on track for retirement, or could this inheritance accelerate my journey?

• How can I honour the memory of my loved one in a meaningful way?

These aren’t just financial questions—they’re life questions. And the answers will shape your financial strategy.

Some people may want to use their inheritance to gain more time—by reducing work hours, retiring early, or investing in personal development. Others may see it as a chance to secure generational wealth through smart investment or estate planning.

Whatever your path, aligning your financial decisions with your personal aspirations is what ultimately transforms an inheritance into lasting impact. And that’s where a trusted advisor can help bring clarity, objectivity, and structure to your vision.

4. Seek Advice to Maximise Long-Term Value

Mistakes made with an inheritance can be costly and often irreversible. Tax inefficiencies, poor investment choices, or the absence of an estate plan can significantly erode your windfall.

At Independent Wealth Partners, we work with your accountant and legal advisors to:

• Structure investments for long-term growth and tax efficiency

• Protect assets using appropriate legal structures

• Integrate your inheritance into your existing financial strategy

• Ensure your estate plan reflects your updated circumstances

Our role is to provide structure and clarity—ensuring the decisions you make today serve you well into the future.

5. Consider Structures for Long-Term Security 

For larger inheritances, more sophisticated planning can help protect and manage wealth across generations.

Family Trusts

These can provide:

• Asset protection

• Tax-effective income distribution

• Structured control over wealth passed to children or grandchildren

Testamentary Trusts

If you inherit through a will-established trust, you may benefit from tax-effective income distribution and strong asset protection—especially for minors or vulnerable beneficiaries.

The right structure depends on your personal and family situation. It’s essential to seek advice tailored to your circumstances.

6. Update Your Own Estate Plan

A significant change in your financial position is the perfect time to revisit your own estate plan. Your will, super nominations, and powers of attorney should reflect your new assets and your wishes for how they are passed on.

Think of this as an opportunity to not only protect your legacy, but to pass on your values through structured giving, support for your family, and the avoidance of unnecessary disputes or taxes.

Final Thoughts

An inheritance is more than a financial windfall. It’s a symbol of trust, a gift of opportunity, and often, a legacy built by someone who wanted to help shape your future.

Handled thoughtfully, it can fund your dreams, support your family, and honour the memory of a loved one in the most enduring way.

At Independent Wealth Partners, we’re here to help you manage that opportunity with clarity, confidence, and care.

If you’ve received an inheritance or expect to, talk to us about the steps to take next.

General Advice Warning

The information in this article is general advice only. It does not take into account your objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information provided and the nature of the relevant financial product having regard to your objectives, financial situation and needs. You should seek independent financial advice to discuss your personal circumstances.