The “Horizontal” Wealth Transfer
We often hear about the Great Wealth Transfer and the trillions of dollars expected to pass to younger generations in the coming decades. But much of that wealth may have another stop to make first: the surviving spouse. According to research cited by Kiplinger, an estimated $54 trillion is expected to pass to surviving spouses before ultimately reaching the next generation.
This article takes an interesting look at the “horizontal wealth transfer” and the financial planning considerations that can come with it, from taxes and retirement income to healthcare costs and ultimately preserving wealth for the next generation.
Year-End Planning Starts Now
It may only be October, but some of the most valuable year-end financial planning happens well before December 31st. A few areas worth reviewing as we head into the final months of 2026 include:
Tax-Loss Harvesting
Reviewing taxable accounts for potential losses may create opportunities to offset realized capital gains.
Retirement Contributions
Now is a good time to review year-to-date contributions and determine whether you’re on track with your retirement savings goals.
Roth Conversions
Depending on your individual tax situation, converting a portion of a traditional IRA to a Roth IRA before year-end may be worth considering.
Required Minimum Distributions (RMDs)
If you’re subject to an RMD, make sure your required distribution is accounted for before year-end.
Charitable Giving
Year-end giving may provide tax-planning opportunities, including gifts of appreciated securities and Qualified Charitable Distributions for eligible IRA owners.
Looking Ahead:
The final months of the year tend to move quickly. Taking some time now to review your investments, retirement accounts, charitable giving, and other planning opportunities can help identify items that may be worth addressing before December 31.
If there have been any changes in your life or financial situation that we should know about, please don’t hesitate to reach out to our team.
Source: Donna Fuscaldo, Kiplinger, “The ‘Horizontal’ Wealth Transfer: Why Spouses, Not Kids, Are Inheriting Trillions First.”
This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding any funds or stocks in particular, nor should it be construed as a recommendation to purchase or sell a security. Security and advisory services offered through Pinnacle Investments, LLC member FINRA/SIPC. We do not provide tax advice and recommend you seek the advice of a qualified tax professional.
Questions about any of the topics discussed in this newsletter?
Whether you’d like to review your financial plan, discuss opportunities for your children or grandchildren, or simply have a financial question, we’re always happy to help.
