Client Question: What Should I Do With an Inherited IRA?

Tag: Financial Planning

Posted on

Published June 23, 2026

At a Glance

  • Your first move isn’t a financial decision — it’s identifying which type of beneficiary you are. That one fact sets every deadline and withdrawal rule that follows.
  • The “10-year rule” is the trap most heirs never see coming. Many non-spouse beneficiaries must empty an inherited IRA within ten years — and if the original owner was already taking required withdrawals, you may owe them each year along the way.
  • Move deliberately, not quickly. A rushed lump-sum withdrawal can hand a large share of the inheritance to the IRS in a single tax year. The right sequence, not the fastest one, is what protects the money.

Few financial events arrive as tangled up with emotion as an inheritance. When a parent or a spouse leaves you an IRA, you are handed a meaningful gift and a stack of unfamiliar rules in the same breath — and some of those rules carry deadlines you can trip over without ever knowing they were there. Some version of this question reaches me a few times a year, usually a few weeks after a loss, and it almost always opens the same way: “I inherited an IRA. What am I supposed to do with it?”

The honest answer is that it depends on who you are to the account. Once we settle that, the path gets a great deal clearer. Here is how I walk clients through it.

First, figure out what kind of beneficiary you are

Before you touch the money, you need to know your status, because the rules around withdrawals and timing change depending on it. The IRS sorts heirs into a few categories — and which one you fall into drives everything that comes next.

Beneficiary type Who you are General withdrawal timeline
Designated beneficiary Named on the account, but not in the eligible group below (often an adult child). Empty the account within 10 years.
Eligible designated beneficiary A surviving spouse, a minor child of the owner, someone no more than 10 years younger, or someone chronically ill or disabled. Usually exempt from the 10-year rule; can stretch withdrawals over your own life expectancy.
Nondesignated beneficiary Not named on the account; you inherit it through a will or the estate. Five years, or continued annual withdrawals — depending on the owner’s age at death.

Most of the people who ask me this question turn out to be designated beneficiaries — an adult child who inherited a parent’s IRA — which means the 10-year rule is usually the part that matters most. We’ll come back to it.

One deadline that’s easy to miss

There’s an early trap worth flagging before we go further. If the person you inherited from was already taking required minimum distributions (RMDs) — the mandatory withdrawals that begin at age 73 — their withdrawal for the year of death still has to come out by December 31 of that year. If it doesn’t, the IRS can assess a 25% penalty on the amount that should have been withdrawn. It’s one of the first things I check, because the clock is often already running by the time we talk.

Your four options

Once you know your status, you generally have four paths. Which one fits depends on your tax picture, your timeline, and what the money is ultimately for.

1. Disclaim it

You can refuse the inheritance — for instance, if accepting it would push you into a higher tax bracket and another family member is better positioned to receive it. A disclaimer has to be made within nine months of the owner’s death, after which the IRA passes to an alternate beneficiary or to the estate. It’s an uncommon move, but a powerful one in the right circumstances — usually as part of a deliberate, family-wide tax plan rather than a snap decision.

2. Take a lump sum

You can withdraw everything at once. With a traditional IRA, the entire amount lands on your tax return as ordinary income that year, which can quietly bump you into a higher bracket and inflate everything from your Medicare premiums to your capital-gains rate. With a Roth IRA the withdrawal is generally tax-free — provided the account has been open at least five years, otherwise a 10% penalty can apply. The money is yours either way; the real question is what it costs you to take it all in a single year, and whether spreading it out would keep more of it in your pocket.

3. Withdraw over time

Often the more tax-efficient route: leave the assets in an inherited IRA, where they keep growing tax-deferred, and draw them down on a schedule. This is the path where the 10-year rule lives — and because the timing differs by beneficiary type, it deserves its own breakdown, just below.

4. Roll it into your own IRA

This option belongs to surviving spouses only. You can move the assets into an IRA in your own name and treat them as though they had always been yours — frequently the simplest and most flexible choice, since it resets you onto the ordinary retirement-account rules. One catch: if the original owner hadn’t taken their required withdrawal for the year, you generally have to take it on their behalf before moving the funds.

The 10-year rule, explained

Since the SECURE Act, most non-spouse beneficiaries can no longer “stretch” an inherited IRA across their lifetime. Instead, how long you have to draw the account down depends on your category. The current distribution rules (IRS Publication 590-B) break down like this:

  • Designated beneficiaries (not in the eligible group) must empty the account within 10 years — the clock starting the year after the owner’s death. If the owner had already begun RMDs, you also have to take an annual withdrawal in each of those years, not just a lump sum at the end.
  • Eligible designated beneficiaries generally escape the 10-year rule and can stretch withdrawals over their own life expectancy. For a minor child who inherits, the 10-year clock starts ticking at age 21.
  • Nondesignated beneficiaries who inherit through an estate face either a five-year deadline or continued annual withdrawals, depending on whether the owner had reached their required-distribution age.

You don’t need to memorize the life-expectancy math — the IRS publishes tables for that, and getting the numbers right is exactly the kind of thing we handle together.

Where people get tripped up

The rules above are knowable, but a few details cause most of the avoidable mistakes I see. The first is treating an inherited IRA like your own and accidentally commingling it with a contributory or rollover IRA. They are legally distinct accounts with different distribution rules, and mixing them creates tracking headaches you do not want. If you are already juggling several retirement accounts and tempted to tidy up, it is worth reading why I usually counsel keeping an inherited account in its own lane.

The second is timing. The year-of-death withdrawal, the 10-year deadline, the five-year Roth aging window — each has a date attached, and the penalties for missing them are steep. These are deadlines worth putting on a calendar the moment the account changes hands.

The third is forgetting that this is an estate-planning moment as much as a tax one. An inherited IRA is a natural prompt to confirm that your own beneficiary designations are current — because the smoothest inheritances are almost always the ones where someone did this work ahead of time.

The bottom line

Inheriting an IRA can feel both meaningful and overwhelming — a reminder that someone cared for you, wrapped in decisions that carry real tax consequences. The most important thing to know is that you don’t have to sort them out alone, and you rarely need to act in a hurry. The early deadlines matter, but most of the choices reward a measured, tax-aware approach over a fast one.

If you’ve recently inherited a retirement account — or you’re the one doing the planning and want to make this easier on the people you love — let’s walk through your situation together before any clocks run out. That’s exactly the kind of question I’m here to help you answer.

Part of TAGStone’s Client Questions series. See also: How Do I Give My Kids a Head Start on Investing?

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

Published June 9, 2026

At a Glance

  • Timing is everything. Your Initial Enrollment Period is just seven months around your 65th birthday. Miss it and Part B and Part D surcharges follow you for life.
  • Higher earners, plan ahead. IRMAA surcharges are based on income from two years prior — so decisions before 65 (Roth conversions, capital gains timing) shape what you’ll pay.
  • Medigap vs. Medicare Advantage. For affluent retirees the choice usually turns on access and flexibility over premium — the post lays the trade-offs side by side.

Most people spend decades saving, investing, and planning for retirement. Yet one of the most consequential financial decisions of those years has almost nothing to do with your portfolio. It comes down to a government program, a single birthday, and a deadline you do not want to miss.

The program is Medicare, and the window to enroll opens around your 65th birthday. Signing up on time lets you make full use of the coverage you’ve already paid for — and preserves your flexibility as healthcare becomes a larger line item later in retirement. Here’s what’s worth understanding before that birthday arrives.

The enrollment window — and why timing matters

Medicare was created in 1965 to give older Americans access to affordable healthcare. It isn’t free, but if you or your spouse paid payroll taxes for at least 10 years, you’ve already funded a meaningful share of it — a good reason to claim your benefits as soon as you’re eligible.

Your Initial Enrollment Period runs for seven months: the three months before the month you turn 65, your birthday month, and the three months after. Miss it, and you can face delayed coverage and permanently higher premiums — surcharges designed to discourage people from waiting until they’re sick to sign up. You enroll through the Social Security Administration’s website.

One important exception: if you’re still covered by a current employer’s group health plan (yours or a spouse’s), you may be able to delay enrollment without penalty. Whether that applies depends on the size of the employer and the specifics of the plan, so it’s worth confirming rather than assuming.

The four parts, briefly

Part A — hospital coverage. Covers inpatient hospital stays, skilled nursing care, hospice, and some home healthcare. For most people there’s no monthly premium, because you prepaid it through payroll taxes. You’ll still owe deductibles — $1,736 in 2026 for the first 60 days of a hospital stay, with meaningful copays beyond that. If you’ve paid in over your career, there’s no penalty for delaying Part A — and no real reason to.

Part B — outpatient coverage. Covers doctor visits, the ER, preventive care, lab work, and medical equipment. The standard 2026 premium is $202.90 per month (higher for upper-income households — more on that below), with a $283 annual deductible and a 20% coinsurance on most services. Missing your Initial Enrollment Period adds a permanent 10% surcharge for every full 12 months you delayed.

Part C — Medicare Advantage. Optional plans from private insurers that bundle Parts A and B, often with Part D, and frequently add dental, vision, and hearing. They typically replace Part B’s open-ended 20% coinsurance with fixed copays and a capped annual out-of-pocket maximum. You still pay your Part B premium, plus any additional plan premium — though some Advantage plans charge none.

Part D — prescription drug coverage. Sold through private insurers; the average 2026 premium is about $34.50 per month, with an annual deductible up to $615 depending on the plan. If you already have creditable drug coverage (through a current employer, say), you can delay without penalty. Otherwise, waiting adds a permanent 1% surcharge for every month you go without it.

Medigap: filling the gaps

Medigap policies are supplemental private coverage that pick up out-of-pocket costs left by Parts A and B. They carry higher premiums — sometimes several hundred dollars a month — but they smooth out the unpredictable copays and coinsurance that can otherwise add up.

The timing here is its own trap. Your six-month Medigap enrollment window opens the first month you’re both 65 and enrolled in Part B. Enroll during that window and you cannot be turned down or surcharged for preexisting conditions. Wait, and that protection may disappear. Note, too, that you can have Medigap or Medicare Advantage — not both.

Medigap vs. Medicare Advantage: which fits an affluent retiree?

For families with substantial assets, this choice usually turns on access and flexibility, not the monthly premium. Here’s how the two approaches compare on the factors that tend to matter most at higher levels of wealth:

Feature Medigap (Original Medicare + Supplement) Medicare Advantage (Part C)
Provider access Unrestricted. See any doctor or specialist nationwide that accepts Medicare — no networks. Network-based. Limited to local or regional HMO/PPO networks; a preferred specialist may be out of network.
Care approvals Minimal. Original Medicare rarely requires prior authorization, so physicians drive care decisions. More gatekeeping. Prior authorization is common and can delay specialist care.
Global coverage Usually included. Most Medigap plans cover foreign-travel emergencies up to plan limits. Emergency-only. Typically thin abroad — a gap for frequent international travelers or multi-property owners.
Cost structure Predictable. Higher monthly premium, low cost at the point of care (Plan G still leaves the 2026 Part B deductible of $283). Variable. Lower premium, but copays accrue up to an annual out-of-pocket maximum.
Concierge medicine Compatible. Pairs cleanly with concierge or private-physician memberships. Often friction. Managed-care network rules can conflict with concierge practices.

Comparison reflects how Original Medicare with Medigap and Medicare Advantage generally work; specifics vary by plan. Sources: Medicare.gov; KFF.

For those who prize unrestricted access to specialists and minimal administrative friction — and who can comfortably carry a higher premium — Medigap (often Plan G) tends to be the better fit. Families who prefer a lower premium and don’t mind network rules may still do well with Medicare Advantage. The right answer depends on your health, how much you travel, and how you like to receive care, and it’s worth weighing alongside the rest of your plan.

A note for higher-income households

For many of the families we work with, the standard premiums are only the starting point. Higher-income retirees pay an Income-Related Monthly Adjustment Amount — IRMAA — on top of their Part B and Part D premiums. The surcharge is tiered, and it can add hundreds of dollars a month per spouse at the upper brackets.

The detail that surprises people most: IRMAA looks back two years. Your 2026 premiums are based on the income you reported for 2024. That lag is exactly why the years leading up to 65 matter so much. Decisions about Roth conversions, when to realize capital gains, and how to time large or charitable distributions can ripple into what you pay for Medicare later. It’s one more reason a thoughtful approach to spending and withdrawals pays off, and a conversation worth having well before your enrollment year.

The takeaway

Medicare has a lot of moving parts, and the penalties for getting the timing wrong follow you for life. The good news is that the decisions are manageable with a little preparation. With some advance planning, many retirees can keep their healthcare costs in check even as their medical needs grow — and avoid the avoidable surcharges along the way.

This is one piece of a larger retirement picture that also includes how your accounts are organized and whether your core legal documents are current. If you’re approaching 65 — or helping a parent who is — we’re glad to walk through how Medicare fits into your plan and to coordinate the timing with the rest of your financial life.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

Published May 26, 2026

At a Glance

  • An estate plan drifts. Beneficiary designations, fiduciary appointments, and trust funding fall out of sync with real life faster than most families realize.
  • Annual reviews are short. Think of it as a physical for your plan — a scheduled check that catches small issues before they become expensive ones.
  • Five areas to check each year: beneficiaries, fiduciaries, trust funding, life-change triggers, and where your originals are stored.

It’s tempting to think of an estate plan as a one-time project — sign the documents, file them away, and check the box. But an estate plan is only as good as the life it reflects, and your life keeps moving. Beneficiaries change. Fiduciaries age out. Assets get retitled, sold, or acquired. Laws shift. A plan that was airtight three years ago can quietly drift out of alignment with what you actually want today. We covered the foundation of this work in Protecting What’s Yours (After You Pass).

That’s why we encourage clients to think of estate planning the way they think of an annual physical: a short, scheduled review that catches small issues before they become expensive ones. Even in a year without major life changes, a yearly checkup is worth the hour.

Here are five areas worth reviewing each year.

1. Confirm your beneficiary designations

Most of your assets pass under your will or trust. But a meaningful share — retirement accounts, life insurance, certain annuities — passes by beneficiary designation, which overrides whatever your will says. That makes these designations one of the most common sources of unintended outcomes.

Check that named beneficiaries still reflect your wishes. Common red flags: an ex-spouse still listed on a 401(k), a deceased relative as a sole beneficiary (which can force the asset through probate), or a custodian arrangement for a child who is now an adult. Most custodians let you update beneficiaries online in a few minutes. It’s one of the highest-leverage estate planning tasks you can do.

2. Revisit your fiduciary appointments

Your fiduciaries — trustees, executors, agents under power of attorney, health care proxies — are the people who carry out your wishes when you can’t. The right choice ten years ago may not be the right choice today. (We walk through each of these documents in The Core Four.)

Health changes, deaths, and shifting relationships are obvious reasons to update. Less obvious: a sibling you named when your children were small may now reasonably be replaced by an adult child. Check in with named fiduciaries each year — and after any plan update — to confirm they’re still willing and able to serve. Don’t forget the backups.

3. Make sure your trust is actually funded

A revocable trust only works for the assets that are titled in its name. We see this often: a client signs a trust, then buys a new home, opens a new brokerage account, or inherits property — and never retitles it. Those assets bypass the trust and often head straight to probate, defeating one of the main reasons the trust exists. Kiplinger has a useful primer on which assets belong in a revocable trust if you want a refresher on the categories.

Each year, walk through your asset list and confirm everything intended for the trust is properly titled. Real estate, business interests, and non-retirement financial accounts are the usual suspects. (Retirement accounts generally stay in your name with beneficiary designations rather than being retitled into the trust.)

4. Reflect recent life changes

Marriages, divorces, births, adoptions, and deaths in the family are all triggers for a plan review. So are larger financial shifts — the sale of a business, a meaningful inheritance, or a significant change in your overall net worth.

Two reminders that often get overlooked. First, moving to another state matters. Estate and probate rules vary, and community property states have particular rules around spousal rights to retirement assets. Second, federal tax law changes can meaningfully alter the calculus on lifetime gifting, the estate tax exemption, and trust structures. When Washington moves, it’s worth checking whether your plan still does what you think it does.

5. Store documents securely — and accessibly

A plan no one can find is a plan that doesn’t work. Originals of your will, trust, powers of attorney, and health care directives need to be stored somewhere safe and somewhere your fiduciaries can actually get to them when the time comes.

A fireproof home safe or your attorney’s secure storage are usually better choices than a bank safe deposit box, which can require a court order to access after death. Digital copies are useful for reference, but courts and financial institutions generally require originals with wet signatures.

Your fiduciaries don’t need a complete list of account numbers. They generally need to know which institutions hold your assets — with that, a death certificate and your Social Security number are usually enough to identify everything.

Estate planning is a process, not an event

Most annual reviews are short. But a regular cadence is what makes the bigger updates — after a major life change, a relocation, or a tax law shift — feel routine rather than overwhelming. For the procedural side of what your family will face after you’re gone, our estate planning framework walks through it step by step. Protection during your lifetime gets its own treatment in Protecting What’s Yours (While You’re Alive).

If it’s been more than a year since you looked at your estate plan, that’s a reasonable starting point for a conversation. We’re happy to coordinate with your estate planning attorney to make sure what’s on paper still matches what you want for your family today.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

Published April 28, 2026

At a Glance

  • U.S. homeowners premiums are up 24% over three years; some states north of 50%.
  • In the Southeast, post-Helene reinsurance costs are getting passed through even to inland homeowners.
  • Treat your renewal as a financial planning input — re-check coverage, shop carriers, and revisit retirement-geography assumptions.

If you’ve opened your homeowners insurance renewal lately, you’ve probably done a double-take. Premiums are up — sharply — and the pressure isn’t easing. Across the country, homeowners have seen their rates climb by 24% over the past three years, with some states seeing rates climb by more than 50%. As of last summer, insurance now accounts for more than 9% of the average single-family mortgage payment — the highest figure on record.

For families in the Southeast, this is more than a national headline. Hurricane Helene in 2024 left a trail of damage from Florida through eastern Tennessee and western North Carolina, including places that historically didn’t consider themselves catastrophe-prone. Reinsurance costs have followed, and they get passed through to homeowners, whether or not your roof has ever seen a named storm.

Insurance isn’t part of TAGStone’s licensure, and we’re not here to recommend a policy. But where insurance touches your financial plan — your cash flow, your real estate exposure, your retirement geography — it absolutely matters. Here’s how we think about it.

Start with your primary residence

If you’re facing a renewal hike, work the problem from a few angles before you simply pay the new bill.

First, re-read your policy. Coverage levels often haven’t kept pace with rebuild costs, and standard policies don’t cover everything: flood and earthquake are typically separate, and wind exclusions are common in coastal markets. Being under-insured at renewal time is a quieter risk than the sticker shock, but it’s the more expensive one if something happens.

Second, get a fresh quote from another carrier. The market has fragmented — some insurers have pulled out of certain ZIP codes, others are aggressively pricing in markets they want. A good independent insurance broker is worth their fee here.

Third, consider raising your deductible. A higher deductible lowers the premium, but it shifts more risk onto your balance sheet. That trade is worth it only if you’ve actually built — and earmarked — the cash to cover it.

Now consider your real estate investments

If you own rentals, vacation properties, or commercial real estate, rising premiums hit you twice: directly, through your own policy, and indirectly, through tenant economics and property values. Single-family rental investors have already seen carriers tighten in coastal markets. Commercial leases that don’t pass insurance through to tenants are renegotiation candidates at the next reset.

A more strategic question: if you’ve built real estate exposure concentrated in one geography — particularly a coastal or fire-prone one — your “diversified portfolio” may not actually be as diversified as the spreadsheet suggests. Insurance pricing is the market telling you something about correlated risk, and it’s worth listening.

A note on retirement geography

For clients planning to relocate in retirement, insurance cost has quietly become a meaningful line item. Florida’s tax and lifestyle case still pencils for many retirees, but the all-in cost of homeownership there isn’t what it was five years ago. The Carolinas, Georgia coast, and Tennessee mountains have their own evolving risk pictures. None of this rules anywhere out — it just means the “where” question deserves a fresh look in your retirement cash-flow plan.

The bottom line

Insurance is a household expense in name only. In practice, it’s a financial planning input — and a growing one. If your premium is up materially this year, that’s a signal to re-run a few numbers: cash flow, emergency reserve, the cost basis of any property you own, and whether the structure of your real estate exposure still matches your goals.

If you’d like to walk through any of those numbers together, please reach out. Insurance decisions are for your insurance broker — but the rest of the plan is what we do.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

Published April 21, 2026

At a Glance

  • Spending well is just as important as saving — but it's surprisingly easy to fall into behavioral traps like signaling, social comparison, and hedonic adaptation
  • Aligning your spending with your personal values is the most reliable way to avoid buying things that don't actually improve your life
  • A thoughtful spending strategy isn't about cutting back — it's about spending intentionally on what matters most to you

It has never been more tempting to spend money. Every day, we’re pressured to buy something, whether through traditional ads, targeted recommendations or the curated lifestyles of online influencers. The messages are constant and persuasive.

Financial professionals like us spend a lot of time talking about how to save. But knowing how to spend well is equally important. And for many, spending is surprisingly fraught, wrapped up in behavioral biases and the psychological imprints of past experiences.

Unexamined spending can lead to extremes. On one end of the spectrum, you find overspenders who rack up debt and land in financial hot water. On the other end are those afraid to spend, depriving themselves of things they can afford that would give them pleasure.

Ultimately, spending is unavoidable. Ideally, we find a middle path that allows us to cover necessities and spend on the things that truly bring joy, whether that’s hobbies, travel, experiences with your family and friends, or simple everyday pleasures.

So how do you engage in thoughtful spending? These tips can help.

Consider Your Values

One of the best ways to become a mindful spender is to spend in line with your values. Take the time to identify what matters most to you. These could be things like health, family, community, security or creativity. Before making a purchase, consider whether it supports one or more of these values. Doing so can help you avoid potential behavioral traps, such as signaling—spending money to shape how other people think of us.

It’s one thing to buy a nicer car because you need it. It’s another to buy one because you want to broadcast status to neighbors.

If you can truly afford to do this, there’s not necessarily a lot of harm done financially speaking. But it’s still worth asking whether the motivation reflects something you truly value or simply a desire to impress others.

And if the purchase stretches your finances, the irony is clear: Spending to appear wealthy actually undermines your financial security.

Compare and Despair

Closely related to signaling is the phenomenon of keeping up with the proverbial Joneses.

Morgan Housel, partner at The Collaborative Fund and author of The Psychology of Money puts it well: “There are two ways to use money. One is as a tool to live a better life. The other is as a yardstick of status to measure yourself against others. Many people aspire for the former but get caught up chasing the latter.”

When we see other people spending freely—neighbors renovating their kitchen or friends taking pricey vacations—it can create subtle pressure to match their choices. After all, we humans are deeply wired to avoid appearing like outsiders.

But appearances can be misleading. The people you’re comparing yourself to may be financing those purchases or stretching their budget to maintain a perfect front.

So again, before trying to match anyone’s spending, revisit your own priorities. You may find that the security of living within your means is much more important to you.

Be Mindful of Hedonic Adaptation

Besides being a bit of a mouthful, hedonic adaptation is the tendency for humans to return to a baseline level of happiness even after major positive or negative changes in their lives. In other words, the emotional impact of these events fades quickly over time.

This can have important implications for spending. Many purchases—the latest smartphone, a luxury car, a bigger home—promise lasting happiness. These items might provide a short-term boost in satisfaction, but that feeling typically fades faster than we’d expect.

Understanding this tendency can encourage a bit of pause before making big purchases. If it’s greater happiness you seek, whatever you’re considering buying likely isn’t the solution.

Being mindful of hedonic adaptation can also help guard against lifestyle creep, where spending gradually increases as income rises without necessarily improving long-term happiness. Buying that bigger home requires spending more on things like taxes and upkeep, which may quickly make you feel out of control. Or as Housel puts it: “Sometimes the stuff you spend money on has so much influence over your autonomy…that it’s not clear whether you own things or the things own you.”

On a more reassuring note, just as we adapt to positive changes, we also adapt to setbacks. Difficult events like a job loss or a financial downturn can feel overwhelming in the moment, but emotional recovery tends to be swift.

Think Before You Carpe Diem

Popular aphorisms encourage us to “carpe diem,” “YOLO” or “live for the moment.” And on a fundamental level, that message has merit. Life is unpredictable, and it’s important to enjoy it.

However, the idea also can be used to justify impulsive spending, allowing our present selves to win out over our future selves.

Consider a simple example: Spending $200 on a new pair of boots now may not seem like a major decision. However, if that same amount were invested and allowed to grow for decades, it could be worth thousands of dollars in the future.

This doesn’t mean you should never buy those boots—especially if you can afford them. The key is considering the trade-off and making that decision consciously.

Interestingly, carpe diem—often translated as “seize the day”—may have originally carried a more nuanced meaning. Some scholars suggest it would be better translated as “pluck the day,” an allusion to picking fruit or flowers at harvest time. Seen this way, the phrase originally may be more about appreciation and enjoying opportunities when the moment is right, rather than an exhortation to take impulsive action. That, perhaps, is a useful way to think about spending as well.

A Plan That Makes Room for Living

It might be easy to think that financial advice is all about pushing you to cut back and save more. In reality, it’s about finding balance. Together, we can build spending strategies that reflect what matters to you most, so you can feel confident about your future without putting your present happiness on hold.

At TAGStone, our planning conversations aren't just about accumulating wealth, they're about deploying it in ways that reflect what matters most to you. If you'd like to talk through how your spending fits into your broader financial picture, we'd welcome that conversation.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

At a Glance

  • Geopolitical conflicts can trigger short-term market volatility
  • Diversified portfolios are designed to withstand these periods
  • Midterm election years often bring volatility, but historically lead into strong market periods

Periods of geopolitical tension can cause sharp market reactions and unsettling headlines.

Recently, events in the Middle East have escalated rapidly. On Feb. 28, the U.S. and Israel launched an attack on Iran, setting off a rapidly escalating conflict across the Middle East. Fighting has spread to other countries, bringing with it destruction and loss of life.

In addition to the humanitarian toll, the conflict is making economic waves globally. As of 2025, 20 million barrels of oil per day—about 20% of global consumption—traveled through the Persian Gulf. That traffic came to a standstill after the attack, and oil prices climbed swiftly.

These events have investors worried and markets reacting. In early March, the CBOE Volatility Index jumped to its highest level since the near bear market last April.

What Exactly Has Markets Concerned?

Investors worry that rising oil prices could slow the economy. Energy is a key input for transportation, manufacturing, and other activities. When oil prices spike, many industries face higher costs.

Investors are also concerned about inflation. Higher energy prices can lead to broader price increases. What’s more, many investors were hoping the Federal Reserve would lower interest rates to boost the economy. If inflation rises, the Fed may be less likely to do so.

Your Portfolio Is Built for Moments Like This

While the headlines are alarming, periods like this are not unusual in long-term investing. At TAGStone, portfolios are designed with the expectation that geopolitical events, economic shocks, and market volatility will occur from time to time.

It’s important to remember that your diversified investment portfolio is built to withstand moments like this.

For instance, your portfolio already includes allocations to U.S. and international stocks, bonds, and cash. The fixed income portion of your portfolio, in particular, can help provide stability when equities become more volatile, helping smooth overall portfolio fluctuations.

Within the equity portion of your portfolio, diversification also helps manage risk. Some sectors may struggle when energy prices rise, such as technology and consumer discretionary.[1] On the other hand, energy companies might benefit from rising prices, potentially helping offset losses elsewhere.

A diversified portfolio does not eliminate losses, but it can help reduce the magnitude of downturns compared to broad market indices such as the S&P 500.

It’s also worth remembering that much of your portfolio is invested for the long term. Short-term market movements can feel uncomfortable, but the assets that fluctuate most today typically are the ones you won’t need to draw on for many years. As a result, you may not need to change anything about your portfolio to respond to the current news cycle.

This year may also naturally bring somewhat higher market volatility. Historically, midterm election years have tended to experience larger intra-year declines—closer to about 17–18% on average versus roughly 14–15% in a typical year. While those declines can feel unsettling in the moment, the period following midterm elections has historically been one of the strongest stretches in the four-year presidential cycle.

A Final Perspective

In times of geopolitical crisis, it is natural for both people and markets to react quickly. History, however, suggests that these events rarely alter the long-term trajectory of markets.

One useful way to think about geopolitical crises is that markets tend to treat them as temporary disruptions rather than permanent economic changes. Denise Chisholm, director of quantitative market strategy at Fidelity, looked into geopolitical shocks from Pearl Harbor through Russia’s 2022 invasion of Ukraine. She found that, on average, U.S. equities returned about 8% over the following year, on par with their long-term annual average. Her conclusion: “It’s the exception, not the rule, that geopolitical events become sustained market headwinds.”

The chart below illustrates how U.S. equities have historically performed in the year following major geopolitical shocks.

If you have questions about how current events may affect your portfolio, don’t hesitate to reach out. We’re always happy to talk through your concerns and help you stay focused on your long-term plan.

[1] See slide 6 of the linked chart pack.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

At a Glance

  • Most people have one or two of these documents in place — but comprehensive planning requires all four, working together as a coordinated safety net.
  • Each document serves a distinct purpose: financial decisions, medical decisions, end-of-life preferences, and asset distribution.
  • Estate planning failures are rarely about missing documents — they're about outdated designations, poor coordination, and plans that haven't kept pace with life.

No one likes to imagine a time when they might be sick or unable to make decisions for themselves. It ranks alongside cleaning out the garage or scheduling a long-overdue physical—important, but all too easy to postpone. Yet having the right estate planning documents in place can make all the difference.

Without a clear plan in place, the state might step in and appoint a guardian to make financial and medical decisions on your behalf. Someone you didn’t choose could end up deciding where you live, how your money is managed, or what medical treatments you receive. That's not a situation any of us wants to be in.

Incapacity exists on a spectrum. It could look like cognitive decline from Alzheimer’s or dementia, physical incapacity after an injury or illness, a sudden event such as a stroke, or a gradual decline over time.

Because these scenarios unfold differently—and at different life stages—you’ll need four key documents to address them:

  1. a durable power of attorney,
  2. health care proxy,
  3. living will, and
  4. a will or revocable trust.

You may already have one or two of these documents, but comprehensive planning requires all four. Together, these documents create a coordinated safety net. Without one, gaps can appear. It’s like living near a river and buying homeowner’s insurance but skipping flood coverage. You’re mostly protected… until you’re not.

1. Durable Power of Attorney

A durable power of attorney (DPOA) is a legal document that authorizes someone—known as your agent or attorney-in-fact—to manage your financial affairs on your behalf, including bills, banking, investments, and business interests. The word “durable” here is key: it means the document remains valid even if you become mentally incapacitated.

Choosing the right person to fill this role matters. Consider someone who is financially responsible, trustworthy, and capable of handling potential conflict if family members disagree. Many people select a spouse or adult children. If these options don’t feel appropriate, we can help you identify another trusted individual or a professional fiduciary.

It’s also wise to appoint a backup agent in case your first choice is unavailable when needed.

One related tool worth knowing about: a trusted contact person on your financial accounts. Unlike a DPOA agent, a trusted contact cannot make decisions or view your accounts, but they can serve as a point of contact for your financial institutions if something seems wrong.

For a deeper look at how a DPOA and a trusted contact person work in practice, including important tips on keeping it current with your financial institutions, see Protecting What's Yours (While You're Alive).

2. Health Care Proxy

Your health care proxy is a document that designates an agent to make medical decisions for you if you are unable to do so yourself. This covers situations where you are unconscious, severely ill, undergoing surgery, or have lost cognitive capacity.

The health care proxy is typically activated when a physician determines that you lack decision-making capacity. At that point, your agent can step in and make decisions about treatments, surgeries, medications, care facilities, and in some states, end-of-life decisions. Ideally, these decisions are guided by your known wishes or their best judgment of what you would want.

Again, a spouse or adult children are common choices. Whoever you name should be someone who understands your preferences about medical care, is comfortable making decisions under pressure, and can advocate for you with medical professionals.

It’s also common to name different individuals for medical and financial decisions. It creates natural checks and balances and helps prevent one person from carrying the entire weight.

3. Living Will

A living will complements your health care proxy. This document spells out—in your own words—the medical treatments you do and don’t want in specific circumstances, such as a terminal condition, a persistent vegetative state or at the end-stage of an illness with little hope for recovery.

You don’t need to name an agent for a living will. However, it may be helpful to come up with this document in conversation with your physician and estate attorney. Tools like the “Five Wishes” framework can serve as a jumping-off point for clarifying your preferences.

Your living will is part of a broader healthcare advance directive. We cover what that includes, and other practical tips, in Protecting What's Yours (While You're Alive).

4. Will or Revocable Living Trust

The first three documents address what happens when you're living but unable to act. The fourth addresses what comes after.

Your estate plan should also include a will or trust that addresses what happens to your assets.

A will outlines how your property should be distributed after you die, names an executor to carry out your wishes, and designates a guardian for any minor children.

A revocable living trust goes a step further. You transfer assets into the trust during your lifetime—typically naming yourself as the initial trustee so you retain full control—and a successor trustee steps in if you become incapacitated or die.

Because assets in a trust bypass the probate process, transfers tend to be faster, more private, and less expensive. There are several types of revocable trusts, and we can work with you and your estate attorney to determine which structure fits your situation.

A will or trust is just the starting point. The greater risk for most families is execution and coordination after documents are signed. We cover what that looks like in Protecting What's Yours (After You Pass) and the step-by-step process in Part 2.

Keep Your Estate Planning Documents Current

No single document covers every phase of incapacity or death. The goal is to have all four in place, kept current, and accessible to the people who may need them.

One important area these documents don’t cover is beneficiary designations on retirement accounts and life insurance policies. These designations override instructions in your will, so make sure they are up to date and aligned with your wishes.

Finally, remember that life is dynamic. Laws evolve, financial situations shift, and relationships change. Plan to review each of these documents regularly, especially after major life events such as marriage, divorce, the birth of a child, relocation, or significant changes in wealth, and update them as needed.

The Core Four documents are the foundation, but they're only as strong as the planning and coordination around them. At TAGStone Capital, we help clients build and maintain that full picture, from incapacity planning to estate execution. To go deeper on what happens after documents are signed, see Protecting What's Yours (After You Pass). Or, if you're ready to talk through where your own plan stands, schedule a complimentary 15-minute conversation.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.

Posted on

How to Have Family Conversations About Money

Money plays a role in so many of the decisions we make, yet it remains one of the last true taboos in American life. Despite its importance, 62% of people say they don’t talk about money at all—not with family, not with friends and in nearly half of cases, not even with their spouse or partner. In fact, most Americans feel more comfortable discussing politics, religion or even the details of their love lives than their bank accounts.

In our work with families, we see this reluctance constantly—and the avoidable problems it creates. Money is tied to identity and emotion, including feelings of self-worth, fear of judgment, embarrassment or shame around things like spending, saving and debt. As uncomfortable as these feelings may be, avoiding these conversations carries a real cost. Silence can create stress, undermine financial security and strain relationships across generations.

These conversations are especially important to have with family. Understanding each other’s expectations, responsibilities and values leads to smarter planning and strengthens families along the way. Talking about money—even imperfectly—is one of the most powerful steps families can take toward long-term financial well-being.

Discussing Finances with Adult Children: Setting Expectations Early

For parents with adult children, looping them into your financial plan helps give them the information and tools they may need to help you one day or ensure your estate plan and legacy wishes are fulfilled. Consider discussing:

Your financial plan: Share how you expect to spend your retirement and what lifestyle adjustments you expect to make. For instance, do you plan to downsize or relocate? Are you planning to spend more time with the grandkids? Take the time to understand if your plans align with your children’s so there are no misunderstandings.

Your estate plan: Let children know what you intend to leave behind, whether it’s financial assets, property or personal valuables. Surprises can lead to conflict, while clarity early on can help prevent it. There are no hard and fast rules about what you need to share. If you’re uncomfortable with specific dollar amounts, for instance, you could use percentages or rough ballparks.

Your goals and values: Wealth planning isn’t just about assets; it’s also largely about purpose. Explain what’s important to you and what you hope to accomplish with your wealth. For instance, are you hoping to help fund your grandchildren’s education? Are there philanthropic causes you value? Helping your children understand the “why” behind financial decisions can make it more likely your legacy is carried out.

Discussing Finances with Aging Parents: Planning Before a Crisis

For children of aging parents, approaching financial topics can feel daunting. It might feel like prying, or maybe money is a topic you’ve never broached with them before. But doing so now is far easier than navigating decisions in a crisis. Honest conversations about future plans and resources can prevent stressful last-minute decisions later. Consider discussing:

Long-term care plans: Do your parents have long-term care insurance or funds set aside for potential future health care needs? Have they thought about where they want to live as they age?

Key decision-making roles: Understanding responsibilities in advance can eliminate confusion when timing matters most. Find out who holds powers of attorney and will oversee medical or financial decisions if parents are unable to.

Financial safety and organization: Ask how parents have organized important documents and where they are kept. Who needs to know passwords to important accounts and where are they stored? Is there an estate planning attorney who has copies of documents such as wills and trusts?

How to Have Productive Money Conversations

While knowing what to talk about is important, having this discussion is another matter. They can be uncomfortable, to say the least, and they’re often downright emotional. A structured, thoughtful approach helps. Consider the following:

Choose the right setting: Avoid holidays and major family events. These are often already stressful times when emotions may be running high. Instead, schedule a dedicated time that allows for calm, uninterrupted conversation. Let participants know the topic in advance so they can come prepared with questions and concerns.

Set an agenda: Be clear about the purpose of the conversation. Are you educating loved ones about your financial situation? Discussing an estate plan? Addressing specific concerns like debt or spending? Putting the agenda in writing can help keep the discussion focused.

Acknowledge emotions: Money is deeply emotional, and strong feelings are a normal part of the conversation. Acknowledging that reality upfront can help defuse tension. Aim to create an environment where everyone feels heard and respected—by asking open-ended questions, encouraging family members to share their perspectives and resisting the impulse to blame or shame.

Turn conversation into action: By the end of the discussion, make sure everyone understands their role. Sometimes the goal of a meeting is simply transparency, and no follow-up is required. In other cases, families may need to outline next steps or ask for help.

We’re Here to Help

Conversations about money within families can be complex, emotional, and consequential. As your financial advisor, we can help clarify complex issues and outline planning strategies for you and your family to consider. We can also help facilitate family meetings, serving as a resource to guide conversation and answer questions as they come up. If you’re ready to talk to your family about money, reach out. We’re here to support you every step of the way.

Past performance does not guarantee future results. All investments include risk and have the potential for loss as well as gain.

Data sources for returns and standard statistical data are provided by the sources referenced and are based on data obtained from recognized statistical services or other sources we believe to be reliable. However, some or all information has not been verified prior to the analysis, and we do not make any representations as to its accuracy or completeness. Any analysis nonfactual in nature constitutes only current opinions, which are subject to change. Benchmarks or indices are included for information purposes  only  to  reflect  the  current  market  environment;  no  index  is  a directly  tradable investment.  There  may  be  instances  when  consultant  opinions  regarding any fundamental or quantitative analysis do not agree.

The  commentary  contained  herein  has  been  compiled  by  W.  Reid Culp,  III  from  sources  provided  by  TAGStone  Capital,  as well  as  commentary  provided  by  Mr.  Culp,  personally,  and  information independently  obtained  by  Mr.  Culp.  The  pronoun  “we,”  as  used  herein,  references collectively the sources noted above.

TAGStone Capital, Inc. provides this update to convey general information about market conditions and not for the purpose of providing investment advice. Investment in any of the companies or sectors mentioned herein may not be appropriate for you. You should consult your advisor from TAGStone or others for investment advice regarding your own situation.