"Big money decisions are never easy, and when they're tangled up with grief, they get even more complicated. The inheritance becomes a symbolic reminder of a life cut short, which makes it almost impossible to figure out what to do with it. Spending it on anything, even if it's a smart financial move, can be a reminder of the loss."
"You do have some time, thanks to the 10-year rule you mentioned. To clarify, because it was your parent's account, you'll need to fully withdraw the money "by the end of the 10th year" after the year of their death, according to the IRS. The good news is, since it's a Roth IRA, you won't owe taxes on your withdrawals (as long as the account was open for at least five years), and you don't have to take anything out right away."
"The point is, there's no need to figure it all out right now, especially while you're grieving. But practically speaking, if you have any high-interest debt (like credit cards, consumer loans, or car notes) it's probably smart to pay that off as soon as possible. Your instincts are right-it might also be a good time to beef up your retirement savings and even your emergency fund."
Grief can make large financial decisions emotionally fraught and turn an inheritance into a painful reminder of loss. An inherited Roth IRA must be fully withdrawn by the end of the tenth year after the year of death under IRS rules. Withdrawals from a Roth are tax-free if the account was open at least five years, and there are no required immediate distributions. There is time to decide while grieving, and practical priorities include paying high‑interest debt and increasing retirement contributions and emergency savings in a high‑yield, liquid account.
Read at Slate Magazine
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