As 2025 comes to a close, it’s the perfect time for high-net-worth individuals and families to review their financial strategies, optimize their wealth, and plan for 2026. Use this checklist to organize your priorities and align your assets with long-term goals and legacy plans.
Assess your assets
Work with your financial advisor to review your assets, maintain liquidity, and help ensure that your investment portfolio is adequately diversified. They can also help you plan for tax efficiency in conjunction with your CPA, incorporating potential tax mitigation strategies.
- Review all investment accounts, including taxable, retirement, and alternative assets.
- Evaluate portfolio performance, diversification, and risk exposure.
- Consider whether your asset allocation aligns with your long-term goals.
Take your required minimum distributions (RMDs)
If you are in retirement, or own tax-deferred qualified retirement accounts, remember that required minimum distributions (RMDs) must be taken annually from taxable retirement accounts by individuals beginning at age 73, as well as by most adult beneficiaries 21 or older who inherit them. RMDs are due each December 31, not April 15. Failure to take them, taking them late, or taking them from the wrong accounts, may result in a 25% penalty in addition to taxes owed.
- Ensure all RMDs from IRAs, 401(k)s, and other retirement accounts are taken on time to avoid penalties.
- Consider strategies for reducing taxable income if you do not need the funds for living expenses, such as making a Qualified Charitable Distribution (QCD) directly from your IRA.
Harvest losses to manage taxes
Tax-loss harvesting may be part of your overall tax strategy and can help manage taxes while keeping your investments aligned with your long-term goals. A year-end review of potential opportunities with your financial advisor and CPA may allow you to offset capital gains and improve tax efficiency across your accounts.
- Identify underperforming assets that could be sold to offset capital gains.
- Review both short-term and long-term gains to maximize tax efficiency.
- Consider tax-loss harvesting strategies across accounts to manage overall tax liability.
Revisit estate and charitable giving plans
Even if you don’t expect to owe estate taxes due to the high exemption levels in the latest OBBBA tax bill, intentional planning around gifting and charitable giving can help support your general family values, multigenerational goals, and tax efficiency. Be sure to consider the annual gift tax exclusion in addition to the lifetime gift and estate tax exemption, particularly if you plan on selling or leaving a business to partners or heirs.
- Ensure your estate plan reflects current laws and your family circumstances.
- Update wills, trusts, and beneficiary designations as needed.
- Consider charitable giving strategies, including donor-advised funds or charitable trusts, for both tax efficiency and impact.
Review liquidity and cash flow for 2026
Think about your goals and anticipated expenses for the coming year and identify what resources you’ll need to meet them. This could include anything from tuition payments to philanthropy. In some cases, it may make sense to realize gains or take distributions this year to fund next year’s needs, particularly if it aligns with your current tax bracket.
- Project income and expenses for the upcoming year, including major planned purchases or investments.
- Assess liquidity needs to cover taxes, lifestyle, and unexpected expenses.
- Review credit lines or financing options for flexibility.
Roth IRA Conversions
A Roth conversion strategy, like a backdoor Roth, can move taxable assets from a traditional IRA or 401(k) to a tax-free Roth IRA. Although ordinary income taxes are due in the tax year that any Roth conversion is done, it may be worth the future tax-free growth and withdrawals, no RMDs required, and no taxes for heirs as long as the Roth account has been in place for five years or longer.
- Evaluate whether Roth conversions make sense for your tax strategy. Backdoor Roth conversions may work for those with high net worth or high income.
- Undertake Roth conversions or backdoor Roth conversions carefully with your CPA and financial advisor since they cannot be undone, and can come with unintended tax consequences if not undertaken properly.
- Consider timing conversions to optimize tax brackets and reduce future RMD burdens.
- Weigh the near-term tax hit against the long-term flexibility it provides.
Every high-net-worth family has unique needs and priorities. Use this checklist as a starting point and contact your Park City Wealth Advisors to review strategies tailored to your family’s goals.
Sources:
https://www.schwab.com/learn/story/estate-tax-and-lifetime-gifting
https://investor.vanguard.com/investor-resources-education/article/how-to-set-up-backdoor-ira
https://www.kiplinger.com/personal-finance/a-checklist-for-high-net-worth-individuals
