An inheritance can arrive as cash, a brokerage account, concentrated stock, retirement assets or a mix of all four. The investments were typically selected for someone else’s goals, time horizon and tax situation. They are not automatically appropriate for yours.
The first instinct is often to do something immediately — sell everything, or leave everything exactly as it is. Neither reaction is required. A short period of review is usually more useful than a fast decision.
Start with what you now own
Before changing the portfolio, identify the accounts, the holdings, the cost basis where it matters, and any concentrations. An inherited account can look diversified while still depending heavily on a single company, sector or original advisor relationship.
Tax rules are not the same for every account
Taxable brokerage assets, IRAs and employer plans follow different rules. Some inherited investments receive a step-up in basis. Others do not. Selling first and asking later can create a tax bill that a more deliberate sequence would have reduced or deferred.
There is no single answer that is appropriate for every investor who inherits a portfolio.
Before making significant changes, it is useful to understand what you own, the portfolio’s allocation and risk, your own financial goals and any relevant tax considerations.
A practical order of work
- List every inherited account and who currently has authority over it.
- Identify concentrated positions and large cash balances.
- Separate tax-deferred accounts from taxable accounts.
- Write down your own objectives, time horizon and need for liquidity.
- Then decide what should be kept, sold or repositioned.
Gold Coast Capital Management works with families in Chicago who have inherited investment accounts and want those holdings evaluated in the context of their own lives — not the original owner’s. A complimentary review can establish a clear starting point.