What to Do When You Receive an Inheritance or Lump Sum: 6 Grounding Principles for Clarity and Confidence

There comes a point in life when money decisions become deeply personal.

For many of us in our 40s and 50s, that moment often arrives in the form of a lump sum, an inheritance, a redundancy payout, or proceeds from a major life transition. While on the surface it may seem like a “good problem to have,” the emotional, mental, and financial weight of receiving a lump sum can be surprisingly heavy.

Over the past several months, I’ve been living this reality myself after the passing of my father. Alongside the grief, logistics, and emotional waves that come with loss, I was faced with a question many people quietly struggle with:

What do I do with this money, and how do I make sure I don’t get it wrong?

Here are six principles I’ve learned along the way that can help you navigate this season with clarity, confidence, and compassion.

1. Timing Matters More Than You Think

One of the biggest pressures people feel is the need to act immediately, to have a perfect plan the moment the money lands.

You don’t.

Money often comes in stages, not all at once. And more importantly, you are not in the same emotional state today as you will be in six or twelve months’ time. Grief, shock, and responsibility can cloud decision-making.

Yes, some things may need to happen quickly, such as debts, legal obligations, immediate costs, but long-term decisions deserve breathing space.

Sometimes the smartest move is simply not rushing.

2. Be Intentional About Tax

Lump sums can quietly create tax consequences if you’re not paying attention.

This is where a good tax accountant becomes essential, not to “avoid” tax, but to legally minimise it. Superannuation contributions, timing across financial years, and structural decisions can make a meaningful difference to what you ultimately keep.

Don’t guess. Get advice early.

3. Protect the Asset (and the Relationships)

If trusts, siblings, or blended families are involved, asset protection is not optional.

Clear legal guidance ensures the money is distributed according to intention, not assumption. I’ve seen situations where delays or misunderstandings led to irreversible damage, both financially and relationally.

A good estate lawyer working with your accountant can save you enormous stress later.

4. Review Your Portfolio Holistically

A lump sum changes your financial picture instantly.

Rather than looking at the money in isolation, step back and assess your entire portfolio:

• How much is in cash or defensive assets?

• How much is allocated to growth?

• Does this balance still make sense for your age, lifestyle, and future plans?

As we get older, the balance between growth and safety naturally evolves, but it shouldn’t happen accidentally.

5. Have a Plan (Even a Simple One)

You don’t need a complex strategy, but you do need some direction.

If you’re already investing regularly, you may simply build on what you’ve been doing. If not, this can be a powerful moment to start, gently, consistently, and in alignment with your values.

Plans reduce emotional decision-making. They give you something steady to return to when doubt creeps in.

6. Be Kind with Yourself

This may be the most important principle of all.

Receiving an inheritance is rarely just about money. It’s about legacy, responsibility, grief, memory, and identity — and those emotions can arrive in unexpected waves.

You are allowed to pause. You are allowed to change your mind. And you are allowed to take time to find clarity.

Often, this process becomes less about transforming your life, and more about confirming that you were already on the right path.

If you’re navigating a lump sum and feeling unsure, overwhelmed, or afraid of making the wrong move, you’re not alone — and you don’t have to figure it out alone either.

Sometimes clarity isn’t about doing more.  It’s about slowing down enough to listen.