When the phone call comes, and you learn you’ve been left an inheritance, the moment is often bittersweet. Beyond the numbers are memories, gratitude, and sometimes even uncertainty or guilt. How should you handle this financial windfall, especially when it represents a loved one’s life work? Luke Staden, founder of Staden Financial Management has the answers.

As someone who has specialised in advising clients through similar crossroads, I’ve found that investing an inheritance is as much about honouring the past as it is planning for the future.

A gift that’s more than money

An inheritance is never just a bank transfer; it’s a final message of trust from someone who loved you. Before making decisions, I always recommend clients take a pause. Reflect on the person who left you this gift. What did they value? What would they hope you’d do with it? These questions can help guide your next steps.

Balancing heart and head

It’s tempting to make quick decisions, especially when emotions run high. Some people feel pressure to spend in ways they think would please their relative; others freeze, worried about making a mistake. The reality is, there’s no single “right” answer. Every choice is personal.

For some, investing part of the inheritance in causes or experiences that mattered to their loved one can be deeply meaningful. I’ve seen clients establish scholarships, fund family reunions, or simply set aside a portion of the money in a special account as a nod to the person they lost.

At the same time, your own future matters. Investing for growth—a diversified portfolio, a first home, or education for your children—can also be a powerful way to honour a legacy. It says, “because of you, I have new opportunities.”

Risk vs rewards vs emotions

While it is true that higher risk historically increases total rewards when it comes to long term investments, I often find that the prospect of seeing an inheritance dip in value can be a very emotional prospect for some clients.

Evaluate how much of a connection this money represents between you and the departed, whether seeing a fall in value would cause extreme emotional distress, or if you can treat it as a normal investment. If you feel that temporary falls in value could cause such distress, it can be best to invest with a reduced risk profile, at least at the start while emotions are fresh.

Creating a lasting family legacy

An inheritance can be more than a financial windfall; it’s an opportunity to shape your family’s future. By investing thoughtfully rather than spending quickly, you can build a portfolio that generates income for yourself and for generations yet to come.

This strategy can turn a single moment of good fortune into a long-term source of security and even help you share values and financial wisdom with your children and grandchildren. While it’s essential to address your own needs first, those in a stable financial position may find deep satisfaction in knowing they are creating a lasting legacy.

Tax for investors in the Netherlands

You don’t have to pay inheritance tax in the Netherlands if any of the following apply:

• The value of your inheritance is less than or equal to your exemption
• The deceased was not Dutch and did not live in the Netherlands.
• The deceased was Dutch but died more than 10 years after leaving the Netherlands.

With that said, receiving an inheritance will increase your box 3 tax liabilities going forward as your net worth increases. I always make sure that I calculate an estimation of expected box 3 taxes for clients who have received a substantial inheritance and keep it held safely. Box 3 can often be an unexpected cost down the road if you aren’t prepared for it.

Practical steps forward

1. Take your time
   Don’t rush. Allow yourself space to grieve and reflect before making major financial moves.
2. Clarify your priorities
   Write down what matters most to you and what you believe your relative valued. These priorities can act as a compass.
3. Consult trusted advisors
   Talking to a financial advisor can help you sort through options, balancing sentiment with sound strategy.
4. Create a plan
   Whether you choose to invest for long-term growth, support a cause, or set aside a nest egg, having a clear plan ensures your decisions are intentional.

A living legacy

Ultimately, the most meaningful way to invest an inheritance is to do so thoughtfully and with intention. It’s about creating a living legacy – one that respects your loved one’s memory while building a brighter future for yourself and those you care about.

In the end, the story of your inheritance is yours to write. Approach it with heart, and you’ll honour the past while building something new.

Alternatively, perhaps you had extremely negative feelings towards the deceased, and your goal is to spite them with your choices, perhaps they were deeply homophobic, and you decide to distribute the funds across LGBT support charities.

You have the freedom to choose what you do with your inheritance, just make sure it’s a decision that you’re happy with in the future.

Contact Luke Staden of Staden Financial Management to set up a meeting and discuss your particular financial needs or check out the YouTube channel.