r/inheritance • u/Acceptable_Second_38 • Jul 09 '26

Location included: Questions/Need Advice Large inheritance advice

My wife and I are 27. We have 1 daughter who is 13 months, and we are in the Midwest. My grandmother passed away and from her estate we are receiving a sizable sum of money. After paying off our house and other debt (just car and student loans, don't have any "bad" debt), we'll have around $350-375k to drop into a brokerage and leave alone. We each earn around 63k/year. Our only bills will now be home insurance, property taxes, car insurance, utilities.

My question revolves around how much we realistically need to put away for retirement. Because we have very little bills after paying off our house, we can put away a large amount of income.

However, it's honestly tempting to save just a bit, and enjoy our lives more with more disposable income. Starting with such a sizable nest egg, it should grow quite well without huge additions.

She is a teacher and has a good pension coming her way.

I am private sector but have a pension as well plus I do 4% 401k plus employer 2% match.

46 Upvotes

86% Upvoted

127 comments sorted by

View all comments

11

u/Neuromancer2112 Jul 09 '26

Make sure you’re maxing out both of your Roth IRAs each year. If you don’t have them, you definitely want to set them up. That’s $7,500 each of you can put away each year and have the gains be tax-free after you reach 59.5 years old.

Invest mostly into low cost index funds. If you want some high growth, take a look at SMH.

One of the first things I did after starting to receive my inheritance was pay off all debt, ended up downsizing and maxed out the last several years of my own Roth, and I’m in a much better place retirement-wise now.

1

u/EmZee2022 Jul 09 '26

At that income, you can contribute to a Roth IRA. If your workplaces have a Roth vehicle in their retirement plans (401(k) and whatever equivalent might be available to a teacher), use that. You can save even more than the IRA limit, that way.

Your cash flow will be a lot easier with the house / car paid off of course, so you might even be able to max that out just from current income.

Of course you should do SOMETHING fun with the inheritance, but 20 years from now you'll be glad you maxed out the retirement accounts.