For Love & Money is our weekly series exploring how we navigate one of the most intimate and rarely talked about aspects of our relationships: our finances.
Cate grew up idolizing her father, but for the last decade of his life, he began to isolate himself on his farm and cut off communication with everyone except for her. She still called him everyday to make sure he was alive, but in March 2020, she didn’t receive an answer. When police came for a welfare check, they rushed him to the ER. “At the hospital that night, we learned that his liver had shut down months prior,” Cate tells me. The hospital staff broke early COVID protocols and allowed her and her brother to say goodbye. “He died holding my hand,” she says.
After enduring a tremendous loss, the 35-year-old never expected her hard-working rancher father to leave her with any inheritance. But to her surprise, between his pension and life insurance, Cate and her brother were left with about $1.6 million, or roughly $600,000 a piece after taxes and paying off his medical bills. Beyond eliminating added financial stress about funeral and burial costs, though, Cate couldn’t bring herself to touch the money. The idea of making a mistake with how she spent it and disappointing her dad was too much to bear. “I was too consumed by the fear of regret,” she says.
For some, the reluctance to spend a windfall, no matter where it came from, might seem unusual. And even after experiencing a significant loss, some people take a vacation, buy a home or spend money in other ways to help themselves cope. But like Cate, many others who receive inheritances struggle with how to spend it and what to do with the guilt that their financial boon was borne from loss.
“Money can actually complicate grief in many situations,” says clinical psychologist Carla Manly. In her experience, this situation is more challenging for individuals who didn’t grow up wealthy and who received the inheritance unexpectedly. Of course, family tension over the funds can make matters much worse. But even without any added drama, the combination of grief and a pile of money brings its own specific type of emotional roller coaster. “A person might at first feel a combination of joyful surprise and then move to guilt — only to return to feeling joyful a bit later,” Manly says.
Behavioral economist Keisha Blair has witnessed clients become paralyzed by inheritances in the million-dollar range, as they attempt to work through their “financial survivor’s guilt.” But after becoming a widow herself at the age of 31, Blair has also experienced this kind of grief firsthand. “I’ve heard many widows talk about their life insurance payout as blood money,” Blair recalls. “Some of them instantly donate it or ignore it and don’t want to touch it because it’s associated with the loss of a loved one.”
Much like the clothing and personal items of the deceased, money can become emotionally attached to the memory of the loved one as well. “Some widows question every money decision through the lens of ‘what would my deceased spouse do?’ to justify every decision, which leads to a feeling of being stuck in the past and not really living,” Blair explains. Others have reported feeling undeserving of the money and experience anxiety, numbness or shame over spending it.
On the flip side, there are those who are quick to make serious mistakes while in the throes of grief — like spending it all on luxury items or impulsively giving too much money away out of discomfort, only to regret it later. Blair has seen inheritance impact a person’s ability to tolerate risk, too, which means they wind up putting the money into very low-yield investments and watch much of it get eaten up by interest. “Many people impacted by financial anxiety and trauma don’t take enough risks out of fear that something will go wrong,” Blair says.
Although money can make grief more complicated, Blair tries to remind people that the deceased left the inheritance as a way to help make their loved one’s life easier. And from a financial wellness standpoint, it often does.
Two years after losing her father, Cate is doing exactly what many experts would advise her to do: Hanging onto the inheritance while she heals, investing much of it with the help of trusted financial advisors. “If it’s just going to sit, it might as well sit and be useful,” she says. But looking back, Cate admits she almost made numerous big, impulsive purchases, before pulling herself back and thinking about what her father would have wanted. “It would have been very easy to spend that money on things that made me feel good at the moment, to fill the huge void with stuff.”
And as much as hanging on to the money feels like hanging on to a part of her dad, she has other reminders of him as well — namely, his dog, who is much easier to hold on to. “One day I’ll find something to do with the money that feels right,” she concludes. “But the reality is, that’s not right now.”