Posted on March 21, 2024 by Katherine Fox.

5 Things I Wish Everyone Knew About the Inheritance Process

What are the steps of the inheritance process?

After a loved one dies, it’s going to be an awful time. There’s no two ways around it. 

But there’s an “awful time” and a “really awful time.” 

The “awful time” has grief, regret, family feuds, and a mountain of logistics. 

The “really awful time” has all those things PLUS confusion, more family feuds, and a fog of uncertainty and impossible decisions. 

Trust me, you want to avoid the “really awful time.”

That’s where Sunnybranch comes in. 

You don’t need another thing on your to-do list. You need:

• Education on how the inheritance process works

• Expert logistical support 

• Someone to take care of the financial and estate settlement details 

• A shoulder to lean on in difficult moments 

When Sunnybranch is on your team, you have all of that and more. 

You get on-demand access to an expert financial advisor with personal and professional experience helping inheritors manage new wealth. 

Working with Sunnybranch saves you mental energy and gives you space to focus on grief, healing, and building a path forward after your loved one’s death. 

Whether you’re dealing with an inheritance now or educating yourself with a future inheritance in mind, there are 5 things I wish all my clients knew about the inheritance process. 

If everyone knew these five things we could all save SO MUCH time and heartache. 

5 Things I Wish Everyone Knew About the Inheritance Process

1.iYou can make a plan for inherited wealth BEFORE your parents die

People don’t like talking about death. Parents especially don’t like talking about death with their children. 

But the easiest way to know what to do after your parents die is to talk to them while they are still alive. 

You don’t need to start these conversations by going over the finer parts of your parent’s estate plan. 

Start with simple open-ended questions about your parent's retirement plan and end-of-life wishes:

• Do you know where you want to live in retirement? 

• Have you thought about aging at home versus in a retirement community or assisted living?

• Do you have a plan in place if you get sick or hurt and can’t make medical decisions for yourself? 

• Have you written down information like your healthcare insurance details and contacts for healthcare providers?

• Is there a doctor or hospital you want to be involved in your care in case of a serious illness?  

After you have opened your parents up to basic conversations about their end-of-life plan, you can start getting more specific with your questions:

• Have you thought about where you want a funeral or memorial service held, and anything specific you would like included in the ceremony? 

• Is there a preferred burial or cremation option you want?

• Is there a document or letter of instruction that outlines your final wishes and guidance for me and your other heirs?

• Do you have a will or trust in place?

• Who is the executor of your estate? Who are the backups if that person is unable to serve?

• If you have a trust, who is the trustee? Who are the backups if that person is unable to serve?

• Where can I find copies of your will, trust, and other important estate planning documents?

When you have the basic outline of your parent’s end-of-life wishes and estate plan, start building a plan for the end of their life and what will happen after they die. This plan should include:

• People to contact in case of medical emergency or illness 

• Who to contact after your parents die 

• Key accounts, assets, and properties that need to be secured after your parents die 

• Where to find your parent's key documents and what to do with them

As you start building this plan, pay attention to who else will be involved and who you should educate and bring into your planning:

• Siblings

• Other family members

• Family friends 

• Charities receiving gifts from your parent's estate

2. The inheritance process can take a LONG time

You shouldn’t count on receiving an inheritance quickly after a loved one passes. 

After someone dies, the inheritance process can take anywhere from six months to 2+ years to finalize. Often, beneficiaries will not receive their full inheritance until after the estate is fully settled. 

The inheritance process consists of several stages:

• Locating and gathering assets

• Filing legal notice to creditors or debtors of the estate

• Valuing all estate assets 

• Paying estate debts and taxes 

• Making distributions to estate beneficiaries 

• Closing estate accounts 

• Filing tax returns 

• Final estate accounting 

There are three primary reasons an estate may take an especially long time to settle:

Estates going through probate 

Probate is a state-run process through which a deceased person’s estate is settled. Estates that will be settled through the probate process go through many of the same steps as other estates, but the additional legal and filing requirements often slow down the process.

Large, complex estates 

Large and complex estates will generally take longer to settle and fully distribute assets out to beneficiaries. This is because of the time needed to fully value and appraise all assets held within a large estate, as well the necessity of holding back some estate funds until all final estate tax obligations have been met. 

Contested estates 

When beneficiaries or disinherited heirs disagree about the validity of a deceased person’s estate plan, it can delay the receipt of an inheritance by years. These legal battles can drag on for a painfully long time - a great reason to talk to your parents about their estate plan NOW and make sure everything is in order!

Some estate beneficiaries will receive their inheritances more quickly than others. Those who inherit accounts that pass by beneficiary designation, such as Transfer on Death (TOD) accounts and retirement accounts including 401ks and IRAs should expect to receive funds quickly, in the order of weeks or months. 

Those who inherit by deed or through a revocable trust from a simple estate may also be able to receive their inheritances relatively quickly. 

3. You might not be excited about inheriting money

Society thinks of inheriting money like winning the lottery, but that isn’t the truth.

Someone you were close with died. You are now richer, but that money usually pales in comparison to the impact this person had on your life. 

In addition to inheriting wealth, you’re navigating grief, dealing with a mountain of logistics, and trying to redefine and reimagine your life without the person who died in it. 

If the person who died passed away unexpectedly, or too young, you have another layer of guilt to contend with that they aren’t here to enjoy their money and you are. 

You might:

• Feel like you didn’t earn your inheritance. 

• Feel like you don’t want your inheritance.

• Think the amount of money you have is gross.

• Not understand why you inherited more than other family members.

• Not like having money that came from business practices or an industry you don’t agree with. 

• Feel guilty about getting access to wealth others can only dream of, just for being born.

If you feel any of these things or are feeling some other type of way, it is NORMAL. Nothing is wrong with you. 

Don’t buy into the societal messaging that money is always something to be celebrated. In the case of an inheritance, it is also something to be grieved. 

Take all the time you need to sit with and process your emotions around your loved one’s death and your new wealth before making any major decisions. 

4. Going through the inheritance process requires you to learn a new language

When you are working to settle an estate, you need to get up to speed on vocab, FAST. You’re going to be dealing with state court workers, lawyers, accountants, financial advisors, and a whole host of other professionals who all use their own jargon.

If you feel like you dived into the deep end without knowing how to swim, check out The 20 Terms Inheritors Need To Know to get stories about inheritance and the most important words you need to know to effectively communicate in this new language. 

Not ready for the full guide? I’ve got the five most important terms you need to know here:

WILL: A will is a legal document that details how a testator wants their assets and property distributed after their death. A properly executed will name an executor or personal representative. Wills may also contain provisions for the creation of trusts upon the death of the settlor.

ADVANCED DIRECTIVE OR LIVING WILL: This document is used to appoint a healthcare representative who can make medical decisions on your behalf when you are incapacitated.

POWER OF ATTORNEY: A power of attorney is a document that grants legal authorization for a designated person to make decisions about another person's property, finances, or medical care.

TRUST: A trust is a legal document that creates a fiduciary relationship between a trustee who holds and manages assets on behalf of beneficiaries. Trusts can be used to minimize estate taxes, preserve privacy, and avoid probate. They allow the grantor or settlor to control their wealth and define their legacy from beyond the grave.

EXECUTOR or PERSONAL REPRESENTATIVE: The person responsible for overseeing the distribution and closure of the estate. The executor or personal representative has a fiduciary duty to administer the decedent’s estate in accordance with estate documents and all applicable laws and tax codes. A testator generally names their executor or personal representative in their will.

5. Inheriting money can change your life 

I’ve covered a lot of the tough parts here, but inheriting money can change your life for the better. 

As the grief fades, you will start to imagine the new freedom and opportunity your inherited wealth can provide. 

You might also be overwhelmed and not know where to start, especially if you inherited $1 million+. 

That’s where I come in. 

At Sunnybranch, I help inheritors build a plan for the future that integrates their inherited wealth into their current lives and values. 

Together, we explore what new wealth makes possible while ensuring that we use wealth to honor the memory of the person who died and support your most closely held values. 

Let’s take the next step together

Understanding the inheritance process is not easy. Beneficiaries can encounter a wide variety of different situations requiring knowledge and finesse to manage. If you need more help, you can download The 20 Inheritance Terms you Need to Know, or reach out to Katherine Fox, CFP® and CAP®, a financial planner for inheritors to learn how Sunnybranch can help you navigate the inheritance process.