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Have you recently received a large financial windfall? Or is there a significant sudden money event in your near future?
While winning the lottery may be a dream come true for a few, most sudden money events affecting thousands of people every day involve the loss of a family member, the sale of a business, a legal settlement, or perhaps a divorce.
In many circumstances, the financial windfall may be anticipated, but without certainty as to the timing or additional details becoming known until the event occurs, planning for sudden money events can be difficult. And when emotions get involved, it can be challenging to make rational decisions without the help of an unbiased third party.
Fortunately, a financial advisor who specializes in financial planning for sudden money events can help you make more informed and educated decisions whether you’ve just received a large windfall or anticipate one in the future.
You’ll likely find dozens of financial advisors in your community well-suited to help you reach your money goals with a personalized plan. But it may be more difficult to find a financial advisor with the knowledge and experience to help people affected by sudden money events.
Today, many financial advisors offer virtual services so you can meet online no matter where you (or they) live. This means you can choose to hire a financial advisor who lives hundreds of miles away if you decide their knowledge about financial planning for sudden money events could help you achieve better outcomes.
💰 Smart Money Insights for Sudden Money Events
This page is organized into sections to help you quickly find the information you need and get answers to your questions:
- Q&A with Financial Advisors Specializing in Sudden Money Planning
- Get Answers to Your Questions About Sudden Money Financial Planning
- Browse Related Articles
– Financial Advisors Specializing in Sudden Money Planning –
Three Questions with Danielle Miura, CFP®
We asked Ripon, California financial advisor, and sudden money specialist Danielle Miura to answer three questions often on the minds of people impacted by a sizable financial windfall.
Q: In many circumstances, people know they are likely to receive a sizable windfall at a future date, but without certainty as to when. In these circumstances, what should people be thinking about now from a financial planning perspective to be best prepared for a potentially significant change to their net worth?
Danielle: People who know that they are likely to receive a sizable windfall at a future day should gather as much information as possible, get a rough estimate of their tax and liquidity implications, and prepare if they don’t end up receiving the windfall.
It is important to gather as much information as possible so you are prepared to take the next steps when you receive the sudden money. Depending on your sudden money situation, some of the documents you may want to collect are employee benefits plans, wills or trusts, or account documents.
If you are expecting to receive a large inheritance, you may want to learn more about the individual’s assets while they are alive (e.g. Learn about their business, how they manage rental properties).
After you have collected as much information as possible, meet with a tax professional and/or estate attorney to discuss the possible implications of receiving the sizable windfall. Some questions might include:
- How much tax will I be expected to pay?
- How can I liquidate the asset(s)?
- How can I reduce my tax liability?”
Lastly, have an alternative plan if things don’t go according to plan or you don’t get as much money as you initially thought you would.
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Q: When a sudden money event does occur, what are the primary benefits of working with a financial advisor who specializes in planning around these major life events?
Danielle: The primary benefits of working with a financial advisor who specializes in windfall planning are to navigate you through the process, educate you about your options, and avoid unnecessary fees and tax implications.
Many people believe that having a financial windfall can solve all their problems, but if they are not prepared it can often lead to a tremendous amount of confusion and uncertainty. Creating a team of professionals that have knowledge in taxation, laws, and financial planning can help you ease your anxiety and protect your assets from solicitations and unfortunate money mistakes.
Q: What questions should people ask a financial advisor to determine if they are a good fit to help navigate a sudden money event?
Danielle: What are your credentials? Describe the type of clients that you normally work with. What is your policy regarding working with other advisors, such as your CPA, estate attorney, or insurance broker? What is your investment philosophy? What do you expect from me in our relationship? How are you paid(e.g. commission, flat fee, percentage of assets)?
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About the Author
Founder and CEO, Wealthtender
Brian and his wife live in Texas, enjoying the diversity of Houston and the vibrancy of Austin.
With over 25 years in the financial services industry, Brian is applying his experience and passion at Wealthtender to help more people enjoy life with less money stress.