I recommend talking to an estate and tax attorney. I have a tax guy who is in an estate planning office and an estate attorney who has tax advisors in his office. They both would do advice for money planning as part of either taxes or estate planning. We also do our own reading etc and haven’t listened to very much “personal” advice. But I’ve really been thinking of getting a better plan/advice because we are WAY overweight in one company stock and need to unwind some of it with hopefully not so disastrous tax consequences. If you talk to estate people, they can give you general tips and you can make your own plan. They also know a lot of stuff that doesn’t show up in the OH convert your IRA to a Roth level of advise. And they will understand your finances!
Interesting. Yeah, Dealing with capital gains is going to be fun.
I have worked with several financial advisors and currently use two. In each case a partner/owner I worked with retired or left, but I stayed with the teams that are there. I’m into retirement age but have not retired because I love the intellectual challenge of my work and the freedom/autonomy I have. @Knowsstuff, for context, I co-own one company through a trust, have another that is my employer, and have periodically co-founded other ventures (I am not good at running anything but am good at having ideas that are profitable). I’m in the process of starting another one. I’ve slimmed down my original company so that it focuses on the kinds of work I love to do and moved out employees I didn’t enjoy managing. It is really important to get good tax advice and estate planning advice as @esobay suggests. I have worked with a fantastic tax guy and now his successor and they have saved me large amounts of money over the years. One thing that I spent a fair bit of time worrying about is asset protection – how do I protect my assets if I get sued. Not sure if you have thought about that. It turns out that the solution I reached is helpful from an estate tax perspective. I’m planning to revisit estate planning but don’t currently have someone to do that work.
One of the two financial advisors is a “wealth advisor” or something like that at a big brokerage firm like Merrill Lynch. I have been with them for maybe 30+ years. I have them because they are terrific on service, which is very important for my companies – probably less important for you. They originally suggested that I set up a Defined Benefit plan, which was a wise move though it took a fair bit of work. They move money smoothly, set up accounts, remind my daughter that her visa bill is going to be automatically paid but there isn’t enough money in the core account and ask which account she wants to move money from, etc.. Generally higher fee and mainstream financial advice. They also have been able to get me access to a couple of private equity funds whose normal minimums would be higher than I would like. They have done very well as far as I can tell. If I didn’t highly value the good service, I probably would have moved away from a big brokerage firm earlier. Incidentally, the group I work with was not originally a fiduciary — you should check on this at Merrill – but became on later one.
I selected the second financial advisor because they are lower fee (fee only) and their views of the economy are more similar to mine. They are an independent registered investment advisor (RIA) using one of the major firms for execution and custody. I selected them also because the initial partner was female and I thought might be good for explaining things to my wife without finance lingo. It turned out here young male junior partner (who now is our account lead) was great at explaining. I have probably worked with them for 20 years. They are very holistic – they want to start by figuring out what you want in life. The financial plan focused on what we wanted over the years. They want to understand your risks and will evaluate all of our insurance policies. They moved us into lower cost 529 plans. They tried to help my wife with improving the financial elements of her career. They have thought about the asset protection issues with me. They have always had a bigger foreign allocation than the big brokerage firm. They will work hard to find solutions to problems.
Both help me manage money. I’m busier trying to make money, spend time with my family and have fun. I am happy to have someone pay attention to details and come up with suggestions for me.
@Knowsstuff, those were some basic qualities I have found useful. I hope that is in some way helpful.
I have also taken over my MIL’s finances in Canada. I have worked with the financial advisors at her bank. Very mainstream and plodding. Service is not great. They have five big bangs in an oligopoly in Canada and so competition is weak.
@esobay, I’m dealing with cap gains for my MIL. In the US, if you don’t need the assets that have the big cap gains, you can leave them until you die and the kids can avoid cap gains taxes with an automatic step-up in basis. You may be able to borrow against them. If you can do this, the tax liability is eliminated. In my case, I have tried to put the assets that have the potential for big cap gains into a dynasty trust.
Thanks for explaining all of that. Now I need a drink with my popcorn.
We have the Wealth Merrill people for year’s. They used to be great till they’re not. Used their financial planner but kinda meh. They are not fiduary BTW since they’re locked into their product’s. We also met with a few financial planners and only one was a true fee based only. One just wanted me to do annuities and insurance products.
There is a guy in Chicago( where I live) and I really liked what I am seeing and reaching out to explore. Definitely looking for tax strategies. He’s more give me this amount for the plan then an affordable hourly fee if you want to meet yearly or more.
Problem with Merrill is I can basically do the same thing at Fidelity or Schwab for a much lower yearly fee. Then rebalance.
It’s funny since we have done the forecast projections with Merrill in different scenarios. Also meeting with other advisors and they all ask the same thing. “how much do you need a month). I think differently and always ask “How much can I have per month “
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We use a financial planner who was recommended by H’s coworkers. The guy did lunch-and-learn presentations at H’s employer, and he built his business catering to engineers. He assists us in our investments, and he does our withdrawals & tax withholding now that we live on our IRA withdrawals. He runs an annual analysis to figure out how much to convert to Roth. Our needs are pretty simple. We have friends who have a more complicated financial situation, and they use an advisor who works at a firm that offers more services (such as more specialized tax advice & insurance).
We use a financial planner who my in-laws used for years. He has been enormously helpful to me this year with issues after H’s passing. He will also be doing my tax return as although I am a CPA my entire career was in corporate accounting/ finance.
Understand fees are negotiable. Most advisors will charge about 1% but you can negotiate for less. Advisor skills vary widely. If you want a really comprehensive planner, you can always ask them some technical questions. Explain inherited IRAs post Secure Act (eligible, non eligible, non designated, before RBD, after RBD etc). How does a SLAT work (Spousal lifetime access trust)? Explain NUA (Net unrealized appreciation). What is “upstream gifting”? If they say “We have access to resources”, that means they probably dont know the answer. You can determine if that’s important to you.
Pick someone you’re comfortable with. IMO RIAs doesnt necessarily equate to better. Sure, they are “fiduciaries” but if something goes wrong, it’s not bad to have a giant broker dealer standing behind you.
Most advisors are scared to death of losing a really good client. You are in control.
Understand how they get paid. RIAs will typically charge 1% and the IAR get paid a % of that. The alternative to RIAs are broker dealers. They are divided into 3 main channels. Wirehouses (Merrill, UBS, Wells Fargo, Morgan Stanley are the big ones), banks/credit unions (advisors who work at a bank), Independent (LPL, Cetera, Osaic are the big 3 but there are a ton others). Im not including agencies like Mass Mutual, Northwestern Mutual , Prudential, etc. or what I consder the unique ones like Ameriprise or Edward Jones.
Bank advisors typically get paid 15-50% of revenue that goes to the “grid”. The avg is about 35%. They typically work at a bank because they’re not great at prospecting and/or finding their own clients.
Wirehouse advisors will typically get paid 35-50% of what goes to the grid.
Independent Advisors will get 60-95% but they have to pay for their own overhead and expenses.
This is just my personal understanding. Nothing I post should be construed as a recommendation or advice.
You have a lot of ‘moving parts’.
You probably had input on the sale of your business and how to handle the proceeds the best way, but also the capital gains. Since you sold in 2025 - you obviously need to focus on having the state/any local and federal taxes taken care of.
March 2026, turning 65, handling Medicare filing. You don’t mention if you have a spouse and if so, spouse’s age. If spouse is working/drawing a salary/income or retired.
In some ways, you see the kind of cash flow you are comfortable with.
You decide when you want to take SS.
A number of different scenarios showing how your nest egg will last.
Thinking about what your financial needs are in retirement - if you want to travel during go-go years and what that will take money-wise.
If you have any ‘estate planning’ - what your goals are with that.
”how do you eat an elephant….one bite at a time….”
Lots of things to think about.
I agree that you can do well with Schwab or Fidelity and eventually transfer things from Merrill into something else, be it with some self-managed or some with financial advisor.
A number of individuals posted really good insight.
Around 2013 we attended two evening sessions that followed ‘basics’ using financial association published information (I am not home now to see who puts that stuff out, but FA ordered the two soft-sided books for attendees) - we only paid for those materials. We liked the presenter, and scheduled separate meeting with him - and a series of meetings. He is a fiduciary, the President of his firm of FAs. His firm has grown, and we were moved to one of the new FAs a year or two ago. The new FA is fine - we know the President is guiding.
We consolidated IRAs, Sar-Sep, smaller prior 401k; we now have Roth IRAs managed by FA.
We continue to manage DH’s sizable 401k.
Since we have no pensions, we have spun off funds from 401k to purchase recommended annuities - and the annuities have had different lengths of time, 6 years to 12 years, with different payouts. Both DH and I hold annuities. After the first year, we draw off the max the annuity allows w/o penalty. President/FA has studies annuities well and advised us pretty well on these annuities.
DH and I are both 69 now, and have transferred some funds from 401k to Roth IRA, but we are now transferring some 401k funds into our current personal stock account, so we have access of larger sums - we anticipate possibly moving in 2027 out-of-state/big move. We are in ‘low tax’ years, and during RMD years coming up, it will level things off a bit.
Our FA has some annual events - like a Christmas dinner, and we see a number of people we know.
So if you have family/friends/neighbors that use FAs, at least check them out if you want to use a FA.
Thx. Lots to think about. Yes, have a almost 63 year old spouse that will continue working but we both lecture a decent amount. I was the main generator for the medical practice and she was involved in the medical politics side both locally and nationally. She will actually have to really work now. Lol. We both have side gigs /projects and want to explore those. No annuities for us. We have been to presentations like you said and met with the ceo instructor and it was all annuities and insurances products. When I mentioned ideas like CD /Bond laddering he had no interest. Stated he was a fiduciary. That is a very broad term. Really super nice guy and everything sounds good till it doesn’t in our situation.
We have work to do. We will figure what works for us. I will spend sometime this weekend readying through this thread a bit. I like the idea of doing things myself but only to a point. I would rather pay for someone to create the blueprint that makes sense to me. Heck, I asked AI for the fun of it and put in some details and it wasn’t really far off from what I was thinking about. Lol. But I would rather have someone that doesn’t make commissions on anything create a plan that is best suited to our means.
It’s so funny that everyone I know is saying congratulations to retirement. We are laughing since we don’t see it that way. We just sold our business after like 37 year’s. I have been up since like 5:15 am. Did a workout. Had two glasses of coffee. Working on lists of what we need to do for the transfer of ownership. It’s a stock sale so my wife is handling all the filings.
We aren’t the type to do nothing. Lol. We basically worked part time all those year’s. We were fortunate to have a side business that led into our main one plus I wanted to be home and around the kid’s as they were growing up. So… working less isn’t the issue. Lol. Not doing the 1-1.5 drive is kinda nice. We are going up to the office to make sure stock levels are adequate. Going through drawers. Taking home personal art work. (we had a good amount of nice art work. We wanted the office to feel more like home then a doctor’s office). I am not looking forward to the drive. Lol. We can continue to work in our field in Chicago since it’s a 20 mile radius from our office. Office is 37.5 miles away.
Anyway. Lots and lots to think about. We have time to decide and I am already working on somethings for the next stage of life.
I am drinking the Kool-aid on expat site’s about going to Spain etc. Everyone I dm with says exactly the same thing. They wished they did it sooner. Maybe just a long vacation first. So that will be in the future at some point.
You may want to look into getting a trust and estate attorney. They can help you structure your assets to minimize taxes and make sure you have a decent plan going forward with the assets from the sale of your business. They are also good at asking the questions you might not know to ask.
If you want some recommendations in the Chicago area, PM me.
@shawbridge Yeah, we have let the cap gains ride a long time and having the step up basis is why we started living on the IRA’s sooner than required. Long term it is less taxes. But it makes me feel some sort of way about having so much in just one company. We are talking weird (to me) strategies to unwind some of it and that is where the estate/tax/financial combo of advice is so important.
When we were just starting out and had just bought our first house and thought we needed financial advice, we got went through a financial planner who had good advice on paper, but the outcomes were not good at all. We stuck to more tried and true and self investing after that. We can read and do math, and also decided against the private equity stuff as we felt that we were already somewhat in that market with stock options ect.
Currently I am somewhat of the attitude, “easy come, easy go” with all that profit, but it still doesn’t make sense in my head and heart yet. A thought to keep in mind that did I read here or somewhere else… “ whatever lets you sleep at night.” It might be leaving some $$ on the table and yet…
Also, I had the example of my Mom who was the epitome of “Penny wise and Pound foolish.” She worked hard to save 2¢ on gas or laundry soap and yet let the (crooked IMHO) stock broker churn her account and lost many $$$$
I never liked bonds, and they have not done well in most recent years - including when they did not go up when stocks were down.
We gradually purchased annuities when it made sense - and the particular annuity offered.
I totally understand someone ‘pushing’ annuities due to their commission - our FA presented over time, and not until we had things organized. I also needed to reduce our ‘risk’ and that is why we went to FA in the first place – we were looking for non-stock options (stocks could be managed by them but not us - and they also had funds available to them that are not available to ‘open market’) that were not bonds. Yes, some of our funds have bonds in them, so be it.
’Retirement’ - it is ‘work’ making the transitions, along with the first couple of years being comfortable in the new pace of things - along with having all the working parts fine-tuned.
We are very happy where we are at.
Great first steps.
Why not - if you buy federal agencies (issue is short calls) or munis, you preserve your principal and get interest.
If you have enough principal, you’ll generate, hopefully more interest than you need, and you can continue to buy even more income.
No advisor fees, no commissions, no - give me a million, I’ll give you $75K a year but when you die I’ll keep your million.
There’s a reason the very wealthy are heavy into bonds (specifically munis).
“Invest in what you understand” - also, what I do and don’t want to spend time with.
Our annuities in concept should not be spending down on the principal - and we are still weighing out those results.
Some have property investments - which my parents did, and did great with them because my dad owned a construction company and build quality buildings, along with reworked a building that use to have business offices downstairs into a 5-unit apartment building. It gave them great cash flow in retirement with paid off buildings. He also co-owned a small corner bar and grill, did rework on the building, and eventually had the managing partner be able to buy him out. The bank quoted a higher interest rate than dad thought was fair, so he financed it too. If the buildings were in the larger city 50 miles away, we would have kept the apartment buildings - a thriving city where my sister lives. We did find a local property owner/son who bought two of the buildings, and the third building (the reworked two story) was purchased by the fellow that purchased the other construction company buildings (which included a large paved parking area.
I agree with invest in what you understand.
My nephews have been trying to get me to play the options game - which apparently you can make a lot of passive income - but I simply don’t understand it. Never have, never will.
The bond thing, for me, is easy - lend money, get interest, get paid back at 100 so chance to profit too.
You are right - historically people have made a lot and generated a lot from property.
My personal concern with anything (especially property) - is the risk - so I’ve gone the most risk averse way I can find. That’s why I’m afraid of property although I’ve long eyed INVH stock but haven’t pulled the trigger. I own some REITs so I guess I let others do the managing on that end vs. owning my own. But people who have owned properties have done well - but I’m just so fearful of having no tenant or damage, etc. or all the things that could happen - whereas a city/state/airport/public university aren’t going to default.
Of course, I didn’t just come up with this - I was raised in the environment. My dad was buying munis when I was a kid - after he sold his business at 38.
He’s now 87 and still lives off them. Like everyone, I’m tied into what I know, how I was raised.
But in the end, everyone has to do what’s best for them. But the ultra wealthy gravitate to munis - at least to cover their expenses. Then they take their shots with the rest - because many (such as the ultra wealthy) don’t believe in being conservative. They take their future shots just like they did their past shots.
I hope @Knowsstuff comes up with a plan that brings them comfort, whatever that may be. …and hopefully no or very low expenses (1% or .8% as the account I’m a trustee on pays) - that’s a lot of $$ year after year, especially when passive investments are purchased.
My 30-something niece has lived in Madrid for years & has zero interest in moving back. She loves Spain.
Thx and yes. It’s all what works for you. We will figure it all out but I love hearing different people’s opinions. At some point it will be “hmm, didn’t think about that “.
If I didn’t have grandkids and a husband that wants to live in the US, I could live in Switzerland (as a dual citizen) and manage on my resources. Friends/family there and Schweitzer-Deutsch was my first language. Money doesn’t go as far there for sure. My brother has lived in Switzerland for a few years.
My DD1 wants her children to grow up like her sister and she did - and I can help facilitate that. DH and I will live close to them once SIL’s career is ‘cemented’ in their city (he transitions out of FT Army in April). DH and I are the ‘safety net’ for DD1/SIL - and have had Christmas holidays with them since they moved in 2023 (older kids have longer school breaks than they can both cover with work responsibilities). DD1/SIL has 5 children age 9 months - 7 years and she works FT in very responsible job (and has been primary income from day 1 in 2017 when they married). Eventually the hope is SIL will climb to her pay level - her career has progressed well since college graduation). While SIL doesn’t want to be a ‘kept man’ - he has some resistance to helping with household and childcare tasks (with procrastination) and tends to also be territorial (over the top territorial). I adjust to every new ‘rule’. A double-edged sword on both sides.