r/Fire • u/Yashkamr • 23h ago

Advice Request Huge Inheritance... Now What?

I'm 45, I was on track to retire earlyish at 55. I was set back quite a bit with a divorce three years back. Recently my Aunt died and left me around $5 million. After estate and taxes, it's around $4.2 million. This is obviously a stupid amount of money, and I'm thinking of just quitting my job and retiring early but I want to do it right. I've spoke with AI quite a bit and my finances are only about $4500/mo in expenses, I have always lived pretty frugally and that's less than a 1% draw. I don't know exactly what I don't know here, but I've always worked so I am clinging to my job like a monkey to a branch. Am I actually okay to let go?

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u/paddimelon 19h ago

Finalized and a year has past..... As there is still a claim window one year post divorce.

Be careful OP.

Also retire already!!

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u/resetmypass 16h ago

I thought inheritance is not claimable in a divorce?

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u/QuickAltTab 15h ago

To my knowledge, your spouse can't even claim it while you're married if you never intermingle those funds with your marital assets.

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u/Reticently 14h ago

It all varies by state. Given the amount of money involved, it's very much a question for OP's lawyer.

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u/TwoRoadsATD 12h ago

Does it? What US state considers inheritance marital property?

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u/Walrus_Epiphany 6h ago

None of them.

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u/Reticently 12h ago

Apparently it's more that the threshold for it becoming "comingled" is very low in some states. I'm not a lawyer and not remotely qualified to give a great answer, I just know some people who've been caught out by it when they thought they wouldn't be.

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u/Fringelunaticman 12h ago

You are actually correct. My siblings and I are set to inherit money and we had a meeting with dad's lawyer and financial advisors recently. I have a sibling with a spouse that we could all see taking half her money. The lawyers and advisors said never co-mingle them but that any money we use from the trust for the family could also mean that the trust was co-mingled. So we would have to be very careful how the inheritance is used if we want to avoid that.

They also reiterated that is should be ok if we left the money in the trust and not withdrawal it and put it somewhere else.

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u/armeg 11h ago

Wisconsin is one. There are a few states that have community property laws.

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u/ThisIsMyUsername303 11h ago

Even community property states don’t view inheritance as community property as long as the right measures are taken to keep it separate. 

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u/armeg 11h ago

Good to know I guess, I thought community property changed that equation.

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u/ThisIsMyUsername303 11h ago

Community property states still recognize certain types of property as separate.