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Help a trust fund baby: “What should I do with my inheritance?”

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Just got this email from Christine, a self-described “trust fund baby” who asked for advice. What would you recommend?

I am a 22 year old female in my last year of college. I never learned how to manage my money. If I got money, I spend it. So, freshman year of college, a credit card seemed like a fantastic idea. My parents have even bailed me out a few hundred dollars. I’ve kind of come to terms with the fact that this is a stupid move on a lot of students parts, and I’m working through it.

Recently, I learned of a pretty good deal of money – $140,000 give or take – that my well-off, childless aunt and uncle have put into a trust fund for me.They have brought it up to this amount by contributing $30-40k at various times over the past 10-15 years. Anyway, my question is: what should I do with this money?

What do you think?

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94 Comments on "Help a trust fund baby: “What should I do with my inheritance?”"

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Johnny Storm
Johnny Storm
7 years 10 months ago

Don’t touch it! Unless you’re facing Chapter 11 or 13, medical emergencies, or wondering about financing for a home, there should never be a reason at your age to touch that money.

Talk to a financial advisor. Figure out what you want to do with your life, and how to best utilize the money given to you to achieve those goals.

Grace
Grace
7 years 10 months ago

Playing it safe would — to me — suggest sinking it into the highest return savings account you can find and sit on it.

Playing it less safe? Biotech stocks. Sciencewise, there’s a lot of stuff going on in terms of organ cloning, implants, etc. Find a good investment fund and pick out as much biotech as you can. Nothing’s a sure bet, but that’s where I’d put money if I was looking to invest.

Of course, *I* don’t have your trust fund to decide about, either. 😉

Jennifer
7 years 10 months ago

Do not spend it. Decide what your goals are, i.e. a house in several years, etc., and research what type of investment will fit you. Vanguard is a good place for a beginning investor.

Holly Hoffman
7 years 10 months ago

Don’t touch it! At least until you’re 30, or you learn to become honest-to-god responsible with your money. Use it to buy a house out right, or save it for your own family’s use one day.

Aaron
Aaron
7 years 10 months ago

Pay outstanding debts… especially any credit cards, start a Roth IRA max the contributions on that and retire comfortably.

Chris
Chris
7 years 10 months ago

Buy an index fund and leave it for 30 years. Profit.

Mitchell
Mitchell
7 years 10 months ago

invest $100k into some long-term investments. some index funds, some bond funds, and such. use $20-30k to pay off/down debts, and establish a minimum $10k emergency fund in a high-yield savings account. touch that money only in an emergency. take $10-20k and use it to do stuff. buy a car, travel, buy a house/condo, whatever.

Alan
7 years 10 months ago
My vote is pay off all of your debt (if you have any), and then put the rest away for a house. If you ever want a house, you’ve got a great start in saving up for it. You pay almost double for a house over the full life of a mortgage, and you pay significantly more interest than principle early on. You’re in a great position because you don’t have to pay for access to money, you can just pay cash for the house. Then you’ll free up something like 25% or more of your income to live really… Read more »
Tye
Tye
7 years 10 months ago

First, she should understand that $140,000 is not a lot of money. She will be broke before she knows it if she continues her habits.

I suggest spending a little bit of it on something you want, giving a bit of it to charity or your church, paying off your debts, and then investing the rest.

Pierre
Pierre
7 years 10 months ago

Invest wisely.
Regarding Grace’s advice; 9/10 drugs fail when they enter phase 1 or 2 clinical trials, so invest a smallish bit (10%?) in that sector. (That’s where I work).
Regarding Aaron and Alan’s advice; Exactly. Find a way to shuffle as much money/earnings into long-term yet stable investments.
I am 30, just started a 150k salary and am investing max for my 8 and 5 year old. Methinks they will be thankful as I enter the rest home.

Cindy
Cindy
7 years 10 months ago
Use a little to have some fun – maybe 1%. Then invest it in a balanced portfolio. Look at the statements once a year and the rest of the time FORGET ABOUT IT! In the grand scheme of things, $140,000 is not a lot of money. Left alone, it is a great start on retirement. The big lesson to be learned is that windfalls like this are not to be spent, they are to be saved for long-term goals – no exceptions! Given enough time and thought, we can all rationalize spending $140,000 in a year – I need a… Read more »
Rick
Rick
7 years 10 months ago

The people who say “don’t touch it” are absolutely correct, but to a twentysomething with no real financial experience, the money can be a HUGE lure to do something stupid, so what’s really needed is a compromise. If you invest it all in a low-risk bond fund that pays interest on a monthly basis, you get money to spend while you figure out how to deal emotionally with the fact that you’re richer than you ever thought you would be at this age.

loabn
loabn
7 years 10 months ago

Take 20K to blow on whatever type of frivolity makes you happy. Spread it out over time if you need to. This is a windfall; you never knew you’d be getting it, so you should use it to have some fun.

Use some to pay down any high-interest debt.

The rest should be divided up using one of the many asset allocation formulas found on this site and then continue adding to that (fantastic) base once you start working.

Dave
Dave
7 years 10 months ago

I say pay off debt (credit cards) and then put the rest somewhere where it is hard to access. I know CD’s aren’t the best earning solution, but it has helped me to have the money be difficult to access on a daily level. If its in a savings account it is too easy to withdraw when I “need” some quick cash.

Marshall
Marshall
7 years 10 months ago
How did you get through college? Did you finance most of it or was it taken care of by parents, grants, scholarships, etc? If there is college debt, at what rates? Many people rely on private student loans to make it through school. They’re a great last resort to finish a degree. But the rates are high – typically over 10% at origination. The consolidation market dried up with the liquidity of all major financial institutions. As it stands now, Wells Fargo is the last lender. The term is 15 years when previously, 30 year terms were possible and the… Read more »
Andrew Kasper
7 years 10 months ago
The solution is pretty obvious — pay off debts and invest in an index fund. Never touch it except for an emergency. I get the feeling she isn’t asking for the “right” thing to do with the money so much as a plan that she can live with. Unless there’s some regular reward, I think simple “don’t touch it” plans will fail for her. My recommendation would be to pay off all debts, then invest everything in a dividend-paying stock like Coca-Cola (NYSE:KO). Every quarter, she’ll get a check in the mail that she can spend on whatever she wants.… Read more »
Meg
7 years 10 months ago
Well the question is, what CAN she do with it? Is she allowed to access it at 25, 35, when some specific thing happens (graduation, marriage, etc)? Regardless of whether she has full and complete access to the money, she should completely forget it exists for now and leave it invested in whatever it is in. She needs to learn to save from her own income, though, and should start a retirement fund and emergency fund when she graduates and gets a job. Once she gives herself a little financial education she should use the money ONLY to pay down… Read more »
Matt
Matt
7 years 10 months ago
I think the best plan is to pretend like you don’t have it. Even though you’ve got this safety net, you should still SAVE for your first house or car. This sum of money has given you a substantial head start on your savings, but looking at the long run, it’s not huge enough to be a bottomless guarantee of wealth, either. Specifically, I would recommend: pay off any outstanding non-0% debt, put $10,000 in an emergency fund, put as much money as you can in a Roth IRA this year, and put the rest in a low-cost index fund… Read more »
kevin
kevin
7 years 10 months ago

Vegas baby!!!

Tyler
Tyler
7 years 10 months ago

1. Pay off all debts
2. Travel overseas (if you’ve never been and are into that sort of thing. Life experiences are worth every penny and this is the perfect time.)
3. See a financial planner about investing/saving the money. Diversify into funds, bonds, cash, etc.
4. Act like you don’t have it. Eventually use it as down payment on a house, wedding, etc.
5. If you /need/ a car (since you’ll be starting out in the “real world”) use some for that, but be MODEST. This is not an opportunity to blow $30k on something stupid. Fulfill your needs and be done.

freecia
freecia
7 years 10 months ago

#1 – Stop thinking of yourself as a trust fund baby. With 140k, you’re not. There’s a mental adjustment to be made, to not allow your life to revolve around such a label. If you quit school and did not work, the money wouldn’t last you that long. Won’t even get you a house in most parts of the country.
#2 – All good advice above. Don’t spend it willy nilly.

Tyler
Tyler
7 years 10 months ago

I like how nobody said “sit down and figure out what your short, medium, and long-term goals are” before shotgunning a bunch of suggestions out there.

Tanner Christensen
7 years 10 months ago
The smartest thing you could do in a situation like this is first, take about $1,000 out in cash for emergencies. It’s not much money, but it’s often enough to cover any little emergencies (buying new shoes, or a fancy new iPod is NOT an emergency. Ever). Next, pay off all of your debts. With $140k, you should be able to pay off all of your debts and still have a little bit of fun left over. Debts include school tuition, so pay as much as that as you possibly can. Think about it, living debt free, fresh out of… Read more »
Dan
Dan
7 years 10 months ago

$140k isn’t as much as it used to be. £70k can last you frighteningly shortly in todays world, but it’s a good basis to sink into a solid investment.

Johnny Storm
Johnny Storm
7 years 10 months ago

@Tyler and @Ramit Sethi

3rd post, Jennifer, stated that she should sit down and go over her goals.

1st post, myself, stated that she should sit down with a financial planner and figure out what she wants to do with it.

Reading, it’s fundamental . . .
However, it seems comprehension, isn’t.

Rudy
Rudy
7 years 10 months ago
Though $140K is not a lot of money its not a small sum either. Some of the above suggestions are fantastic but i would stongly suggest you consider your risk taking ability and your goals. The below are only additions to the above: The problem with investing $140K in one go is that if you invest all your money in one shot you take a view that the markets will go up in the long run. Which in most cases is true but you cant be sure. Timing the market can be very difficult. One way to help reduce that… Read more »
Rob
Rob
7 years 10 months ago

From personal experience: Pretend it doesn’t exist and talk to a financial advisor about how to invest it. I ended up letting my advisor figure out what to do with it and he’s done a phenomenal job at consistently outperforming the market so that I’m making significant gains even after capital gains tax and his commission. By not dipping into it, I learned to live on the cheap, save money, and handle credit cards–skills which all came in handy when I used half of my fund as a down payment on a house.

Derek Epperson
7 years 10 months ago
First, learn how to manage the money that you have – before you are financially and emotionally overwhelmed (which usually ends in ‘blown it all”) should you receive this money. Read this blog or visit getrichslowly.com or thesimpledollar.com – Take a class, like Dave Ramsey’s Financial Peace University. Once you’ve got a grip on your own finances, I reiterate earlier advice – leave it alone, other than for emergencies and such. Rather than dipping into it, see what the law allows to you ADD to it. This ‘trust fund’ could later be a possible retirement home or even your retirement… Read more »
Moneymonk
7 years 10 months ago

Pretend that you don’t have it! don’t touch it until you become educated about money

frugaler
frugaler
7 years 10 months ago

140k is a lot of money for a 22 y/o. The majority of Americans will not see that amount until they are well into their 30s. Put this in perspective people. You could take 140k and move to other (some) countries and have a part-time job.

1. Set Goals
2. Emergency Fund (High interest savings account (ING Direct etc)
3. Pay all outstanding debt off
4. Vanguard.com (index fund)
5. Call me and lets go get a drink (I’m 23) lol, i.e., Life is too short not to have fun. You just won a fake lottery. Celebrate a little, not like a rockstar!

Eliseo Perez
Eliseo Perez
7 years 10 months ago
140K broken down…. Open an ING account, 1.75% Checking 3.0% Savings, 25K in Savings, 5K in Checking, 110K left, Pay down debt (given you have National average of 10K in debt, leaves you with 100K, Put This years allowable max of 5k into a ROTH IRA (use Primerica) they’re the best, ask for them to disburse the 5K into 5 different account, 1k a piece Usually Pioneer, or Van Kampen are good starts (aggressive, and Growth) Then also some real estate Funds (right now they’re no good, but will be in 3-5 years) So you buy MORE shares, but end… Read more »
Ben Bleikamp
7 years 10 months ago

Buy a Porsche 911 Turbo 🙂

Or, you know, follow everyone else’s smart advice and invest it…

Ben Casnocha
7 years 10 months ago

The “don’t touch it” and invest in index funds advice seems a bit too easy. When you’re young, spending that money in thoughtful ways to accumulate unique experiences (like the commenter who mentioned travel overseas) seems like an excellent investment. Sure, save some, don’t be frivolous, etc. But spending on smart things when young can help propel you on an even faster career track and financial success.

Joe
Joe
7 years 10 months ago
I’m in a similar position. I’m 22, I’m going to graduate college in May with no debt (mostly merit scholarships), and I have roughly $200,000 in inheritance. Most of the inheritance is in a few stocks, and they are too risky and underdiversified at the moment for my tastes. But selling that much stock amounts to giant capital gains tax. I’m also at a crossroads as to what to do with it, especially how quickly to reallocate to meet my comfort level. I probably ought to talk to a financial adviser, but I’m not even sure how to begin going… Read more »
Mike
Mike
7 years 10 months ago
$140k is not a lot of money for a trust fund. That’s only generates about $6000 of income per year. If I were Christine, I would first change my mentality — she is not a trust fund baby. Then I would just forget the money exists and make my own living. When it’s time to settle down and buy a house, she can think about touching some of the money as a down payment for a house … or even better, just wait until retirement to use it. It will be worth millions by then. She can seriously just live… Read more »
Carlin
Carlin
7 years 10 months ago
Figure out some goals (own a house, have kids, retire at 50, etc) and talk to a financial adviser. Find one with a good reputation that you think you can trust, a fee only planner might be your best bet – this means that they charge you a flat fee for their service, no matter what they do, for example they might charge $75 an hour to help you out (well worth it if you don’t know anything about money). Also, I’d take some of it and spend it. It’s nice to live below your means on a regular basis,… Read more »
Average Jane
7 years 10 months ago

*sigh* Never in a million years did I think I’d be asked (as non-directly as it is) to *help* a trust fund baby. I get just over $700 (after taxes) for referring a candidate to my company and I am over the moon!

Carlin
Carlin
7 years 10 months ago
@Joe and anyone else that wants some advice but doesn’t know where to look. If you’re looking for some help with planning, you can search for a Certified Financial Planner using the CFP organization’s website. A CFP is a term that someone has to met certain requirements and has certain ethical guidelines, etc. It’s not something that anyone just call themselves, so it’s a step toward finding someone trustworthy. http://www.cfp.net/search/ Put in your zip code and search. It’s a start on finding some names and then you can meet with some of them, get references, and then decide who you… Read more »
Barbara Saunders
7 years 10 months ago
When I saw the phrase “trust fund baby,” I thought millions, enough never to have to work again. It strikes me as significant that this writer used the phrase. $140K is enough to make a very significant – even life-changing – head start but only that: a head start. My suggestions for consideration (not knowing her!): 1. (Have to get this out of the way) – finance a graduate degree. Many people go this far into debt for a degree that never pays back financially. IF a graduate degree is a dream, using this money to make that happen debt… Read more »
zack
7 years 10 months ago

give it to me? if not that, i’d sink it into a low cost index fund and wait till you retire. or go over here and ask this crowd http://diehards.org/

Jordan
7 years 10 months ago

Spend every dime!

Dave
Dave
7 years 10 months ago
I didn’t read any of the responses so sorry if this has been said already….. It depends on who is getting the money. If “Christine” is getting the money (as she is), she should keep just enough for an e-fund in a liquid, high interest savings account, pay off any high interest CC debt, and then put the rest into a safe investment vehicle like a CD until she becomes financially smart. It’s quite obvious (as she readily admits) that she doesn’t know a thing about money. So rather than risking it in a market she doesn’t understand, put it… Read more »
ekrabs
ekrabs
7 years 10 months ago
The first thing I would want to know is its tax and fee implications, as well as its current investment structure. You’ll want to get in touch with your aunt and get your hands on as much detail about the trust as you can. Even if you don’t understand it right now, it’s OK. At least have it handy. When you can, I’d look through the information and find out exactly what’s involved, cross-referencing it with the IRS website. Here’s a handy link to get you started: http://www.irs.gov/businesses/small/article/0,,id=98830,00.html If you still have questions, write it down and set up an… Read more »
Amy
Amy
7 years 10 months ago
I recently had a windfall myself, though not nearly as large: about 9k. (That’s a lot of money for me right now.) This is what I decided to do with it: 10% to play with (so about $900 to spend on anything I want). Amazing, I’m having a hard time deciding exactly how to spend it! ~2000 into my long-term emergency fund, which brings me to an amount that equals 3 months expenses. ~2000 into my new car fund (I plan on driving my current car into the ground, but that will probably happen in the next few years or… Read more »
Amy
Amy
7 years 10 months ago

I should also mention that I don’t have any debt except a mortgage… if I did, I’d probably throw any money towards that first.

escapee
7 years 10 months ago

I came into the same amount of money when I was about 26. It is NOT a lot of money, as a lot of other people have mentioned.

Here’s what I did with mine: 30k: paid off student loans
120k: paid off my mortgage

that’s it. Now I’m able to take all of my extra money and invest and save it. it’s easy to do when you have no debt and no mortgage/rent.

Dave H
Dave H
7 years 10 months ago

This might have been mentioned in the string, and I could be totally wrong, but from the way the e-mail reads it seems as if your aunt and uncle are still living. You didn’t say you received money , yet you recently “learned” of a trust.

You might want to research how they or their trustee have the trust built to transfer ownership.

No need getting worked up over money you can’t touch yet. Furthermore, they might have more contributions in mind. Which may well surpass any short term return in the market!

Plan your work and work your plan.

mom
mom
7 years 10 months ago
Take this time to recognize that you may have slipped into some bad spending habits,and end the free money spending spree.You have an opportunity to learn something not taught in school.Do not have a crazy party and buy your friends anything. Recognize that your Aunt & Uncle did this for your security,your future,and do not disappoint them. Get advice from several unbiased financial folks.If you have debt pay it off,if you owe your parents pay them too.I am not privy to your parents’ financial health,so think about them if need be. Welcome to the adult world of decisions ,responsibilities,and taxes!… Read more »
oakling
7 years 10 months ago
There’s a lot of talk here about “learn to save,” “learn how to change your ways with money,” “learn to set something aside,” “learn how to live within your means.” Nice and dandy, but in my experience, DOING something is very different from LEARNING to do it, and we’re not really doing anything different here than her parents did – “I won’t teach you how to get there, I’ll just toss you into the financial pool of adulthood and see if you swim. *calling out to thrashing child* Live within your means! Save some money! Bye!” That is assuming of… Read more »
christina
christina
7 years 10 months ago
she doesn’t sound like a trust fund baby at all. she just sounds like a 20-something female who needs to learn more about personal finance and money management. that should be her first step. read other sections of this blog through the “first time here?” link at the top. talk to the aunt and uncle for their advice and learn what they do with their personal finances. you took a good step in emailing this blog. now go read books, magazines, talk to trusted people, and ask about the lovely world of money. the world is relational and so is… Read more »
Christine
7 years 10 months ago
Hi all — I am the Christine the post is about. First off, thank you everyone for your comments. My original email to Ramit was a bit longer and more detailed, and I didn’t except it to become an open survey! Either way, all the advice is appreciated. It seems there is a lot of speculation that because I am a 22 year old female I am going to go and spend it… defintiely never my intentions. I had my fun with a credit card, realized that was a bad idea, and am working to clean that up. (And also… Read more »
Christine
7 years 10 months ago
I guess I should also add, that as some have speculated, I am not an out of control spend every penny person. I save money for things I want before I purchase them, I regularly contribute to savings — pretty much as much as a 22 year old still in college with on and off internships can do. The reason I said I never learned to manage money, was not becuase my parents were irresponsible. Quite the opposite — they are mortage free, no credit cards and paid for every penny of my education through their savings. They work very… Read more »
Jessica
7 years 10 months ago

Splitting the amount in half and putting both in an high interest savings account may be a good idea for you. Good Luck!

J
7 years 10 months ago
First, thing you need to do is not make the mistake of blogging your situation. Anytime, you receive alot of money or just money in general, be careful of free advice. As you can see from the blogs, everybody has their own opinion, and not everybody know’s what they are talking about. Here is my insight. Shop around for a trusted lawyer who can set you up with an estate plan. Make sure you explain to the lawyer your situation. Then decide the best lawyer. Look up J Douglas Jennings to start with. Obviously ceck out other lawyers as well.… Read more »
No Debt Plan
7 years 10 months ago

How about absolutely nothing (assuming the fund is invested properly)? Will be worth a ton of money in the future.

Do this for two reasons:
1. She admits she burns through cash. She should stay away until she learns how to manage money.
2. Again, it will be worth a ton of money 20-30 years from now.

What's up
What's up
7 years 10 months ago

Give it to me, I need to buy some jeans.

Success Professor
7 years 10 months ago
I’m a little concerned with all of the comments that she should not touch the money at all. This is likely very unrealistic for her, and not a very motivating plan for her to follow. Money is a tool, and its use needs to be balanced. The problem is that most people go off the balance by spending it all. If we can create balance that allows for both fun and long-term savings then we can hit the sweet spot. Here are my thoughts: 1. Give away 10-20% of it. But do this carefully. Research each giving option and think… Read more »
Carl Oliver
7 years 10 months ago

Buy our school a new buildling, or at least a new weight room. The 200 pound senior boys treat gym class like its a trip to the dentist office.

Big Winner
7 years 10 months ago

My advice would be to put the money in a “lazy portfolio” – like Yale endowment manager David Swensen’s example here:
http://www.thekirkreport.com/2007/02/david_swensens_.html

Jared
7 years 10 months ago

If you really don’t know what to do with it and you want to protect it from yourself for awhile I suggest opening up a short term CD. You can’t touch it, and its a solid savings vehicle. If you don’t want to actively invest, look into CD laddering and make sure you have a full emergency fund.

Saravanan
7 years 10 months ago
Hi Christine, My suggestion would be the following: 1. Close your credit card bill and also you pay up any other loans which has higher interest rate say more than 5%. 2. Take some money for your expenses say 10k or something per year for next three years. I really don’t know how much is your expenses. Hence I suggested a random number. Try living frugally as much as possible. 3. Split the money say 100k and put it in a Fixed deposit for 3 years and use the rest 40k for your expenses and investment. In the next 3… Read more »
Renato
Renato
7 years 10 months ago
I was incredibly shocked to see this post today. Precisely today. You see, I have been a somewhat shy reader of iwillteachyoutoberich.com, meaning that I read it every once in a while, because I have commitment issues, heheh. I’ve always thought that Ramit always makes a solid point about a lot of things, but have not been able to follow all of his finance advice, because financial instruments, and access to them where I live are quite different from those in the US and I don’t have a clue what an IRA is (other than “lads” with redhair and strong… Read more »
Gerard
Gerard
7 years 10 months ago

My advice is not original, but rather stolen from the book: The Millionaire Next Door.

Leave the money alone. Treat as if you do not have it. And do not start touching it unless you have settled into a lifestyle where you can live of the money you yourself make.
That way when you finally touch the money it will no longer affect you and you can enjoy it for a longer time.

Ken
Ken
7 years 10 months ago

Each person is different with many different habits, needs and skills. Michael Phelps and Tiger Woods need and use coaches. These people get paid to help the best get that way and stay that way. Free advice is worth what you pay for it. Find a financial advisor (not a stock or insurance jockey) you can trust and work with them to design a plan that works for you. Then when times get rough, they can help you stay focused on your goals.

Lena
Lena
7 years 10 months ago

Not sure if anyone will respond to this thread but my situation is similar to Christine’s however I have come into a larger windfall of about 1.2 mil. I have some credit card debt and a mortgage but once if I pay it all off I will still have about 2/3 of the money left over. I am wondering how I should invest the money. Should I pay off all of my mortgage (5.7%) or only some of it and invest the rest? Any suggestions are welcome.

Maurice Ravel
Maurice Ravel
7 years 10 months ago
I received a nearly identical amount recently as a result of a relative’s passing. FWIW, I’m late twenties with zero debt. I basically leave it entirely alone and view it as a way to avoid feeling so pressured to save for retirement. I can focus solely on saving for a house, car, etc. I have 50% of it invested in diversified mutual funds and 40% in money market funds. I slowly move it from the latter to the former to create dollar-cost-averaging during these recent crazy markets. I also have the final 10% in a few things I personally believe… Read more »
Mary
Mary
7 years 10 months ago
I am 39 years old and I am a trust fund baby. I most certainly don’t want to sound arrogant here but $140,000 isn’t alot of money these days and doesn’t even begin to be the kind of money that constitutes “trust fund baby” status. Since the age of fifteen, I have spent more than 2 million. I used much of my money for my college education and travel; I have also lived in almost every major US city, and now own two homes that are located on the coast of Florida and the NC mountains. In my opinion, you… Read more »
Bean Jones
7 years 10 months ago

If you don’t have a good track record when it comes to saving/spending money, I suggest contacting a Financial Planner and threshing out a plan where you can spend some money to invest in yourself (travel, continued education, etc) and to invest most of it towards your future retirement or other long term plans.

I’ve discovered that money I don’t see, is money I don’t spend so if you’re the same, this may be the best way for you to build a nest egg.

Ryan Fitzgerald
7 years 10 months ago

Do some good with it, give it away, start an NGO or invest in a way that keeps it out of your own hands.

ekrabs
ekrabs
7 years 10 months ago
Hi Lena. There’s not enough information to give you decent advice, except that your mortgage interest rate is pretty low. I would set up a separate house fund that will allow you to pay off the house slowly. Doing so will not only allow you to take advantage of the low interest rate, but also take the tax deduction on your house, as well as build your credit. And if you do your homework, you can also find investments that will not only earn interest, but even grow the fund as well. You may also want to make the house… Read more »
LVN
7 years 10 months ago

Las vegas baby!

Lena
Lena
7 years 10 months ago

Thank you ekrabs the idea of a house fund sounds sensible.

Sean
7 years 10 months ago
Hi, Sounds like you got lucky. Yes, yes, $140k isn’t much more than a couple years’ salary, but it’s still a windfall that should not be considered minor. Have you considered furthering your education? Getting an MBA, or a masters in something else? Most people have to take loans out for that sort of thing, but, with the money you have now, you can invest in yourself, and possibly get the chance to be doing something in your career that you never thought possible. I’m looking at business school now and you almost need an inheritance just to apply! Good… Read more »
Nicci
Nicci
7 years 10 months ago
i too am not very good with money. but the first thing is – – i wouldn’t tell a soul about it. i would take some time learning about property prices and find an old residential area that is either very close to a good area (because the wealthy are will ensure that the slightly cheaper area doesn’t degrade tooo quickly, but often they make a plan to uplift tha bordering lower class areas – therby increasing the prices and value of their own properties aswell) or if the property price will allow; in a good area which is close… Read more »
Mitch
Mitch
7 years 10 months ago
Christine, I think it’s great that you are seeking advice about what you should do with your potential ‘trust fund’. Like everyone here I have a couple of suggestions. However, as an experienced financial advisor my perspective is a little different. 1. Get professional advice. Blogs and friends are great, but as you can tell, everyone has an opinion and not all of them are correct. 2. I recommend you go to the Certified Financial Planner (CFP) Board of Standards website (cfp.net) and do a search for a local CFP. The CFP designation is the premier designation in the industry… Read more »
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James
James
7 years 10 months ago

Too much advice here if you really want to know how money really works e-mail me I have an e-book titled Getting a Financial Education In 7 Days or Less. This will hopefully help you understand How money really works.

This book is awesome, it weeds through alot of the unnecessary information about money and gets right to the point. I wil e-mail you this book for free until Sept 30th. Otherwise it is $14.95.

Here is my e-mail jrudd@howmoneyreallyworks.com

Diego Gonzalez
Diego Gonzalez
7 years 10 months ago
I would take the money all out of the bank, and go on a shopping spree all over Europe with it. Buy a Cartier watch, Bulgari jewelry, Tiffany DIamonds, Hermes scarves, then fly on a prIvate jet back to the states, and wear all you fancy clothes to a cocktail party to impress all your friends. Splurge on Champagne, fine wine, go to the spa, and live your life to the fullest. Wake up and wear expensive perfume, and Prada shoes, with couture quality clothes such as Yves Saint Laurent. Then and only then are you a REAL trust fund… Read more »
Laurens Cecil
Laurens Cecil
7 years 10 months ago
Nope, not a chance of it. A “REAL” trust fund baby doesn’t take their money OUT of the bank because trust funds are rarely established at a bank; they are set up at a financial institution and invested in stocks, bonds, etc. Trust fund babies don’t pull their money out of the bank and go on shopping sprees…. they live on the interest from their initial trust fund and don’t go out and spend money erratically on labels. Anyone who knows the real trust fund world knows that most trust funds are the result of “old money” and not something… Read more »
Diego Gonzalez Frausto
Diego Gonzalez Frausto
7 years 10 months ago
I know that. DUH. It was simply satire for what the noveau riche would do with an unexpected inheritance. First off, 140,000 is not considered what I would call “trust fund material”. For those of us who actually have a real trust fund, we don’t wish to let people know our net worth, because this is seem as bragging and people always assume you are lazy and never lifted a finger. Also we tend to be very discreet with our spending habits. Yes we do buy expensive things, but because we know quality, and not because we wish to impress.… Read more »
Victoria
Victoria
7 years 10 months ago

Pay off all of your debts, buy a home with a rental property that will offset the expenses of the house then DON’T TOUCH IT!

Harvey
Harvey
7 years 9 months ago

http://www.porsche.com/usa/models/911/911-turbo-cabriolet/

And put the remaining $700 in a Roth IRA.

Kyle
Kyle
7 years 8 months ago

Give it away. To a relative, to charity.

Earn your way to $140K.

Alyssa
Alyssa
7 years 6 months ago
Honestly, I am your age and finishing up college too and drowning in credit card debt. However, my mistakes I won’t ask people to bail me out I will pay them off. If I were you I would put that money into a CD they come in various amount and for various time periods. For example if you put some money into a 6 month CD you cannot touch that money for 6 months. If you do want the money back you only get what you paid and i think the interest it has already made. If you keep the… Read more »
derek
derek
7 years 5 months ago

Gold is always a good way to preserve wealth. Keep enough cash on hand for medical and emergency expenses.

As for some of it, redistribute the money in the education system to help give someone in an underpriveledged school district the tools she or he needs to come out with the brain power to contribute to society. The more people who drag on society the worse all of our lives are. If the masses are more educated and more prosperous, we are all better off.

Vicki
Vicki
7 years 2 months ago

Hey, $140K is not *that* much and it certainly doesn’t qualify you as a “trust fund baby”. My advice is to splurge it all on a new car, maybe a used Aston Martin DB9, or a new, top-of-the line Mercedes. Just spend it and enjoy being young!

anonymous
anonymous
7 years 2 months ago

alright, first of all 140k is not alot of money for a trust-fund, I know people, myself included, that will get over 2 million when they turn 21. save this for a nice car, or some cushion in this recession if you can’t find a job

Mary
Mary
7 years 2 months ago
These days, in view of the decline in the market, 140k could potentially grow into a much much larger figure if invested wisely. I will once again caution you, however, to be very selective about the financial advice you obtain about investing. I’ve been in the crazy trust fund world since the age of fifteen (my mother was my trustee til I was 25) and it took me a very long while to recognize the ridiculous amounts of money Merrill Lynch and others were making off of my “trust fund.” There is one thing to remember, whether you have 20… Read more »
Mickey
Mickey
7 years 1 day ago

Travel through Europe and Latin America. Be generous and self-actualize!

Tb
Tb
10 months 6 days ago

go to a casino, roulettw table, and put it all on red, u can double your money in 30 seconds

Joan
Joan
7 months 29 days ago

Not one poster in here knows that if you have a trust fund, you have a trustee who controls it. You have NO access to it and no control over it. You can’t spend it, invest it. You have to beg the trustee to give you 5 cents. Shows how many people really have money. No one knows what a trust fund even is.

toolbelt
toolbelt
5 months 1 day ago

Primerica? lol

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