With longevity shifts, periods of heightened inflation and market volatility, traditional financial planning strategies could cause many to potentially outlive their savings.

Between asset management, navigating tax liabilities, mitigating risk and planning for unexpected expenses, complex high-net-worth portfolios could often require careful planning, execution and constant optimization.

Consulting a fiduciary financial advisor can be a great first step to getting the specialized guidance that could be necessary to help ensure you’re on track to meeting your financial goals, and helping secure your legacy for the next generation.

Click here to take SmartAsset’s free quiz to get matched with up to three vetted financial advisors in just a few minutes, each obligated to work in your best interest.

Research suggests people who work with a financial advisor could end up with about 15% more money to spend in retirement.¹

A 2022 Northwestern Mutual study found that 62% of U.S. adults admit their financial planning needs improvement. However, only 35% of Americans work with a financial advisor.²

Seeking guidance in the following areas could potentially help reduce stress and help ensure you’re not at risk of outliving your savings and may be more likely to enjoy the retirement lifestyle you’ve been planning.

7 Reasons the Wealthy May Outlive Their Savings

1. Lifestyle Preservation

Maintaining an affluent lifestyle throughout retirement could become a significant challenge.

High-net-worth individuals often may have higher living expenses, including luxury homes, travel, and leisure activities.

Ensuring these lifestyle choices are sustainable for decades could require careful planning and regular adjustments to spending habits.

2. Longevity Risk

Longevity risk is the possibility of outliving your financial resources.

According to the Social Security Administration, a 65-year-old man today can expect to live to about 84, while a woman can expect to live to 86.5, with one in four 65-year-olds living past 90.³

This increased life expectancy means even substantial wealth could potentially be stretched thin over a lengthy retirement, reducing the amount that could be passed on, if any assets remain.

3. Market Volatility

Economic downturns may disproportionately impact larger portfolios. While high-net-worth individuals may have diversified investments, market volatility could still pose a potential threat.

Sudden declines in the stock market or real estate values could potentially erase wealth quickly, making it important to consider developing a robust risk management strategy.

The 2008 financial crisis and 2020 COVID-19 pandemic demonstrated how suddenly well-planned investment performance can be impacted with no guarantee of certain recovery.

4. Tax Implications

High-net-worth individuals may often face complex tax situations, including higher income taxes, estate taxes and capital gains taxes. Staying ahead of tax law changes and employing strategic tax planning could potentially help preserve wealth and mitigate loss.

Implementing strategies such as tax-loss harvesting or utilizing trusts could potentially help reduce taxable income and preserve wealth. The current federal estate tax exemption is $13.61 million per individual, but future changes could lower this threshold, which may increase tax liabilities for high-net-worth estates.⁴

5. Healthcare Costs

Fidelity Investments estimates that a 65-year-old couple retiring today could need $315,000 to cover healthcare costs in retirement.⁵

Long-term care, specialized treatments, and rising medical expenses may quickly deplete savings, even with comprehensive insurance. Proactively planning for these potential costs could be important to help ensure healthcare needs do not compromise financial stability.

6. Inflation Impact

Inflation could also potentially impact high-cost lifestyles in retirement. The cost of goods and services tend to rise over time, eroding purchasing power.

It can be important for high-net-worth individuals to consider inflation in their financial planning to help ensure their wealth potentially retains its value and could support their lifestyle in the future.

The Federal Reserve aims for a long-term inflation rate of around 2%, but recent years have seen inflation rates exceeding this target, further impacting purchasing power.⁶

7. Regulatory Changes

Changes in laws could potentially have significant implications for retirement planning and wealth preservation.

It can be important for high-net-worth individuals to stay informed about retirement account rules, estate laws, and other regulations and adjust their strategies to comply with new regulations and optimize their financial position.

How to Get Help Ensuring You Don’t Outlive Your Savings

High-net-worth individuals may face complex issues when planning for retirement, and many factors outside of investment management could potentially make a significant impact on how long assets could last.

That’s where afiduciary financial advisor can be invaluable.

Fiduciaries may be able to help you understand your options when it comes to developing strategies to preserve assets, minimize tax liability and seamlessly pass on wealth to the next generation. Additionally, any conflicts of interest must be disclosed, and fiduciaries are obligated to work in your best interest.

Finding a fiduciary shouldn’t be that hard. Thankfully, now it isn’t.

SmartAsset’s free matching quiz can match you with up to three fiduciary advisors who serve your area. From there, you can compare and decide which advisor to work with. All advisors on the matching platform have been vetted through our proprietary due diligence process.

The quiz takes just a few minutes, and in many cases, you can be connected instantly with an advisor to have an introductory call.

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The information contained in this article is general and not specific to any individual’s situation. The SmartAsset quiz matches you with up to 3 financial advisors to which you can compare and decide which to work with.

This is not an offer to buy or sell any security or interest. All investing involves risk, including loss of principal. Working with an adviser may come with potential downsides such as payment of fees (which will reduce returns). There are no guarantees that working with an adviser will yield positive returns. The existence of a fiduciary duty does not prevent the rise of potential conflicts of interest.

SmartAsset Advisors, LLC (“SmartAsset”), a wholly owned subsidiary of Financial Insight Technology, is registered with the U.S. Securities and Exchange Commission as an investment adviser. SmartAsset’s services are limited to referring users to third party advisers registered or chartered as fiduciaries (“Adviser(s)”) with a regulatory body in the United States that have elected to participate in our matching platform based on information gathered from users through our online questionnaire. SmartAsset receives compensation from Advisers for our services. SmartAsset does not review the ongoing performance of any Adviser, participate in the management of any user’s account by an Adviser or provide advice regarding specific investments. We do not manage client funds or hold custody of assets, we help users connect with relevant financial advisors.

SmartAsset.com is not intended to provide legal advice, tax advice, accounting advice or financial advice (Other than referring users to third party advisers registered or chartered as fiduciaries (“Adviser(s)”) with a regulatory body in the United States). SmartAsset is not a financial planner, broker or tax adviser. The Service is intended only to assist you in your understanding of financial organization and decision-making and is broad in scope. Your personal financial situation is unique, and any information and investing strategies obtained through SmartAsset.com may not be appropriate for your situation. Accordingly, before making any final decisions or implementing any financial strategy, you should consider obtaining additional information and advice from your accountant or other financial advisers who are fully aware of your individual circumstances.

The post 7 Reasons Even the Wealthy May Outlive Their Savings appeared first on The Hemet & San Jacinto Chronicle.

The Bennett Estate—An empire! A testament to a life lived in the limelight, the estate is vast, comprising multi-million-dollar properties, lucrative royalties from film and music, and an art collection that would make even the most seasoned connoisseur envious. But it’s more than just wealth; it’s a complex web of investments, trusts, and intellectual property. The Tony Bennett was not only a household name but also a shrewd businessman who built an empire. But as the old saying goes, “With great power comes great responsibility”—and, in this case, a heap of legal trouble.

When the Tony died, he left behind not just a fortune but also a family on the brink of war. The Bennett daughters felt betrayed and sidelined, thus, filing a lawsuit against their brother, accusing him of mismanagement and breaches of fiduciary duty. They claim that their brother, who was entrusted as the executor of the estate, failed in his duty to protect the family’s legacy. Instead of safeguarding the assets, the girls alleged he siphoned funds, made questionable investments, and prioritized his interests over theirs. The lawsuit has turned into a highly publicized battle, with accusations flying and the media watching every move.

Now, let’s zoom out for a moment. The Bennett case is not unique to celeb’s. In fact, this fact pattern is one common among may families across all socioeconomic classes. But, its fun to talk about celebrities, so lets keep the limelight on them, and not us. The Bennett feud is just one example in a long line of celebrity estate disputes that have captured public attention. Celebrity estates are notoriously tricky—just ask the families of Prince, Aretha Franklin, or James Brown. Will contests, trust disputes, and questions about the role of executors and trustees are all too common. Executors and trustees have immense power, and with that power comes the potential for conflict. When a high-profile individual passes away, the vultures circle. But sometimes, the vultures aren’t outsiders—they’re family.

It’s often said that death brings out the best and the worst in people. And when money is involved—especially vast sums of it—the worst can be pretty bad. Add in grief, mourning, anger, rage, sadness and all of the feels… it’s a setup for disaster that can lead to irreparable damage among family relationships. Siblings who once played together, shared secrets, and supported each other through thick and thin can find themselves on opposite sides of a courtroom, locked in a bitter, public, and painful legal battle. To this, the Bennett’s are no different. The loss, grief, money and allegations left the family bonds strained and broken. What was once a tight-knit family has been shattered by greed, mistrust, and resentment.

So, how can such disputes be avoided? The key lies in foresight. Clear, unambiguous wills and regular updates to estate plans can prevent much of the confusion that leads to conflict. It’s also crucial to choose impartial executors—someone who won’t play favorites, who will act in the best interests of all parties involved. In some cases, it might even be wise to appoint a professional executor, someone with no personal stake in the estate.

Now, let’s get to the bottom line: the cost-benefit analysis. Estate disputes are expensive—not just in terms of money but also in time, energy, and emotional well-being. Litigation can drag on for years, draining the estate’s assets and leaving everyone involved exhausted. In contrast, settlement and Alternative Dispute Resolution (ADR) options like mediation can be far more cost-effective and quicker. ADR offers a way to resolve disputes outside the courtroom, preserving family relationships and saving everyone a heap of money.

And here’s the kicker, As one lawyer famously quipped, “Why is it that the people who inherit a fortune always seem to end up needing one to settle the fight over it?” It’s funny because it’s true—and it’s a reminder of just how costly these battles can be.

The Bennett Estate serves as a cautionary tale. It reminds us of the importance of careful estate planning, the dangers of mismanagement, and the devastating impact that financial disputes can have on families. By taking proactive steps, families can avoid the heartbreak of a public feud and ensure that their loved ones’ legacies are preserved—not torn apart.

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