What happens if you receive an inheritance you did not expect, especially a large inheritance?

When someone becomes wealthy abruptly, they could suffer from "sudden wealth syndrome," a term used by Dr. Stephen Goldbart, a psychologist and co-founder of the Money, Meaning & Choices Institute, to describe the challenges and struggles people face when they instantly become wealthy (tinyurl.com/4yvj2sxc).

That large inheritance could trigger changes in a person's state of mind. Dr. Claudia M. Elsig, the founder of the private CALDA Clinic in Switzerland, lists potential changes in her blog "Sudden Wealth Syndrome: The Impact of Money on Mental Health" (tinyurl.com/5xrf8fha):

-- Identity crisis: A person who unexpectedly becomes wealthy can "feel unclear about the role they serve in the world and what their next steps should be."

-- Financial imposter syndrome: A person "finds it hard to accept that they can now buy things they couldn't afford."

-- Guilt and anxiety: "Some can feel undeserving of their windfall or guilty if the money comes at the expense of others." (Example: Unequal shares of an inheritance.)

-- Fear and paranoia: "A person might feel suspicious of friends, family and financial advisers or quickly fear losing their newly acquired fortune."

-- Destructive behaviors: "Some wealth adopters proudly wear their fortune like a medal and spend it frivolously. They feel powerful and love the freedom money brings."

-- The relationship curse: "Most people underestimate how sudden wealth will impact them individually, but even more so how it will affect relationships with friends and family."

None of these states is desirable. The question is whether someone can avoid them. Can someone anticipate something that is unexpected? Is just having an awareness of these possibilities enough? Or, is there a way to avoid sudden wealth syndrome, even if you unexpectedly inherit wealth?

If experiencing the syndrome, there is some guidance from "Sudden Wealth: Avoiding the Twelve Deadly Mistakes," a white paper issued by TGS Financial Advisors (tinyurl.com/3zs89ey4):

-- "Establish a 'decision-free zone' for a specific time period, during which you will consider your options, seek advice, and evaluate your emotional reactions to your new wealth."

-- "Make explicit and deliberate choices between competing priorities." One example: "Is it more important to live in a larger home, or retire at a younger age?"

-- "Establish an amount you will allow yourself to spend without guilt, and spend it." The white paper suggests a figure of 5% of after-tax new wealth as a starting point.

-- Make sure you do reviews of your financial situation. "Spending money is easy. Protecting, accumulating, and growing capital is hard."

-- "Hire smart advisers." That makes sense. What don't you want to do? "Do not learn by making costly mistakes yourself, with your own money." Instead, "obtain guidance from experts who have seen those mistakes before, and can help you to avoid them."

Food for thought ...

One more point: In my world of working with high-net-worth families, I can share that even if an inheritance of a large dollar amount is unexpected (amounts are normally not shared), that does not necessarily lead to sudden wealth syndrome.

The reason is pretty straightforward: Families that involve future inheritors in financial discussions they have with their investment counsel help avoid this type of syndrome.

If you are the future benefactor, remember that you always have the option of educating potential inheritors well before an inheritance arrives. It's not about the dollar amount or even the possibility of an inheritance that is important. What's important is the opportunity to share knowledge of risk and reward, and to role-model prudent decision-making. That's best accomplished with a family approach to money management that prepares a child or grandchild to see his or her own "future self" as a prudent decision-maker.

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There is no doubt that AI is becoming a factor in financial decision-making. According to a LendingTree survey, the "rise of AI (artificial intelligence) [has] influenced how and where people are getting their financial advice" (tinyurl.com/4c97xrr6).

Still, a Gallup Panel web survey of more than 2,000 U.S. adults conducted in April 2025 found that people "are more likely to turn to friends and family (43%) or financial advisers and planners (41%) than any other type of resource" (tinyurl.com/4baybbd2).

The Gallup respondents were asked whether they used each of 10 possible financial information and advice sources. Among those options finishing near the bottom: employer-sponsored financial advice programs (14%) and government consumer resources (12%).

For those ages 18 to 29, 57% chose to rely on friends and family for advice, with 50% of middle-aged adults (30 to 49) saying the same. Closing in on retirement seemed to play a role with older adults (50 to 64), who had professional advice at the top of the list (45%), while seniors (65 and older) also favored financial advisers and planners (51%).

As for online advice, financial websites were used by 36% of respondents overall, while two categories (podcasts and webinars; social media) were each cited by 20%.

Yet the reality is that the "AI boom" has taken off. As noted in a 2023 Reuters technology article, it only took two months after launching in November 2022 for ChatGPT to attract 100 million monthly active users (tinyurl.com/38h8fhcj).

And AI is clearly making an impact. Nearly half of chatbot users say that AI has influenced at least one of their financial decisions, according to the September survey released by LendingTree, an online lending marketplace. Those decisions included budgeting (33%), financial aid or scholarships (32%) and taxes (31%).

The survey of 2,000 people noted:

-- 26% of users turn to chatbots for financial information, with 61% of those users asking about personal finance management, and 42% inquiring about stock market trends and analysis.

-- 74% of Gen Z members (ages 18 to 29) have used a chatbot, compared with 40% of baby boomers (61 to 79).

-- 89% of users think that chatbots are at least "moderately accurate."

LendingTree tested the AI advice by asking 20 personal finance questions for three chatbots: ChatGPT, Claude and Gemini.

According to a LendingTree article about the survey ("49% of AI Chatbot Users Say AI Has Influenced a Financial Decision"), financial advice from chatbots was solid when it came to general personal finance advice, but it often lacked depth when it came to personalized retirement recommendations.

For example, when ChatGPT was asked about a couple who were 50 years old and wanted to retire at age 67, had $100,000 saved for retirement and were seeking to ensure they had enough to retire, it recommended maxing out retirement contributions, meaning the couple would have to invest more than $35,000 per year. The article noted: "Although maxing out tax-advantaged accounts is wise, ChatGPT gave blanket guidance without considering how much of a financial strain this would be for the average person."

From my perspective as both a proponent of financial literacy education and a seasoned investment counsel, even if you approach the exercise as a "skeptical subject matter expert," be alert to how you might use AI.

For information? Sure, as long as you are careful to review the output for accuracy.

For advice? That would be a "no." I doubt that a human can really be replaced given the complexity of a person's financial life -- complexity that is ever-evolving due to changes in taxes, the markets and personal situations.

AI is a vehicle for research, but you don't give it the keys to drive your financial decisions.

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As we look forward to 2026, are you concerned about the future? Financial "awareness" can help turn resolutions into realities.

Inflation remains a top concern for many, as reflected in Fidelity's annual New Year's Financial Resolutions study (tinyurl.com/bdfx32rn). This year's version, released on Dec. 11, surveyed 3,026 adults (18 years of age and older) in early October.

When asked what the top financial concerns were for 2026, 45% cited "rising everyday prices," which finished ahead of "unexpected expenses or financial surprises" (31%) -- last year's top concern -- and "rising health care or insurance costs" (28%). In addition, 55% said they felt overwhelmed by their personal finances, and 31% described their relationship with money as "stressful."

Inflation is not just a U.S. concern. T. Rowe Price's 2025 Global Retirement Savers Study, which conducted an online survey in June and July of 2025 of more than 7,000 respondents from five countries (the U.S., Japan, the United Kingdom, Canada and Australia), reported that 42% of retirement savers indicated their top concern was inflation, finishing ahead of geopolitical events (30%), interest rates (27%) and unemployment (20%) (tinyurl.com/28dvphx8).

Among global savers in the T. Rowe Price study, 50% said they expected a recession by mid-2026, including 48% of the 3,000 U.S. respondents surveyed.

While some inflation is now lower based on a recent Department of Labor measure, combating economic challenges remains a priority, and there are reasons for optimism, including signs that financial planning continues to be embraced.

Seventy-one percent of those surveyed by Fidelity said they have a plan to reach their financial goals, and 78% said they plan to build up their emergency savings.

For those considering a 2026 financial resolution (64% in the Fidelity study), the top three concerns remained consistent from previous years: save more money (44%), pay down debt (36%) and spend less money (30%).

The question becomes: How do you make those resolutions become realities?

In the Fidelity survey, the No. 1 motivation for those who make a financial resolution is "The desire for greater peace of mind." That coincides with the T. Rowe Price study, in which the No. 1 ranked answer for financial objectives was "Overall, having financial peace of mind."

Achieving peace of mind -- how does one do that? From my perspective, having worked with hundreds of clients and students over the years, I can share that the exercise starts with a clear desire to avoid future regret -- and it begins with something ever so simple.

No matter how wealthy someone is, the process starts with awareness. Call it "financial awareness," which is the first step to achieving financial literacy.

It can be as simple as getting in the habit of "observing" spending. Keep track one day a week for a while. If you want to do more, increase the number of days.

Don't bother trying to budget unless you feel that will help you. Budgeting apps are available if you want to go that route -- examples include Rocket Money and Monarch Money. Worksheets are offered by Excel (tinyurl.com/4rxcjdus) and the Navy Federal Credit Union (tinyurl.com/3j8k5uf5). Or, see if a calendar might work for you (Charles Schwab offers a "Personal Finance Calendar for 2026," a month-by-month guide, at tinyurl.com/2ypwvf9t).

Something I can't emphasize enough: You don't want to find yourself at an older age regretting that you didn't do enough when you were younger. The future is always right around the corner. I encourage you to give financial awareness a try -- just for a day. How are you consuming your financial assets now? Does that pattern work for you? Or, is there room for improvement?

The T. Rowe Price survey found that only 31% of those surveyed said they would live in retirement "as well as or better than I did when I was working," while 17% said "I will run out of money." In the Fidelity study, 30% said they were more stressed than in previous years when it came to having enough retirement savings to retire as planned.

Achieving financial peace of mind starts with awareness -- a good way to start the new year. We'll touch on other aspects of financial awareness as the year unfolds.

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