3 Strategies to Increase the Value of Your Estate
You can boost your nest egg's return on investment by adjusting your withdrawal strategy in retirement and planning other smart financial moves.

Managing investments in retirement can be difficult, so while many people choose to manage their own savings, others decide it might be more prudent and less stressful to hire a financial professional.
You can't blame them. People want to enjoy their lives, not spend what should be precious free time analyzing investments and wondering what move to make next – or whether to make a move at all.
But if you're going to hire a financial professional to manage your money, it's important to understand just what kind of value he or she can provide for your financial future.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
I like to say that it's important to know whether your adviser is a portfolio manager or a financial planner.
To understand what I mean, let's examine a hypothetical case of a couple we'll call Mark and Ann, who are both 60 years old and plan to retire at age 66. They hope to maintain their current lifestyle throughout their lives and have assets left over to leave to their three children.
Mark and Ann have planned well for their retirement with a combined $1.05 million in investable assets. Specifically, they have $350,000 in Mark's individual retirement account, $300,000 in Ann's IRA, $200,000 in a brokerage account, $100,000 in Mark's Roth IRA and $100,000 in a CD and money-market account.
Meanwhile, the couple's combined annual income is $120,000. In retirement, they estimate the need for $85,000 annually, taking into consideration an inflation rate of 3%. Their annual after-tax Social Security income is $46,580, meaning they'll need to withdraw $38,420 from savings to reach their $85,000 target.
If they manage their investments themselves, Mark and Ann might enjoy an average increase of 5% year, giving them $4.9 million in required cash flow and $1.2 million to transfer to their children.
But let's say they decided to hire a financial professional. Let's assume that this adviser, after fees, succeeds in increasing the portfolio returns by another 0.5% annually. The cash flow remains the same, but assets to their heirs would increase to $1.9 million, a jump of $727,635.
Lucky heirs!
Sounds good, doesn't it? The obvious conclusion would be that hiring a financial adviser was well worth it.
Unfortunately, a lot of financial advisers stop right there and miss out on potential planning strategies that could have improved the financial outlook for their clients and their families even more.
That's where the question of whether your adviser is a "portfolio manager" or a "financial planner" comes into play.
Let's take a look at a few of the strategies that could provide Mark and Ann, and ultimately their heirs, with an even greater return on investment.
Changing the Order of Withdrawals
Let's say Mark and Ann's savings are spread out among an IRA, a brokerage account, a Roth IRA, a CD and a money-market account, and they decide to withdraw money from the accounts in that order.
The results are the examples I illustrated above.
But let's say Mark and Ann reverse that order, withdrawing money first from the money-market account and the CD, which would be the accounts with the lowest return on investment. Their cash flow would remain the same, but the assets left to the heirs would grow by an additional $606,363 to $2.5 million.
That's a huge chunk of cash in return for a simple change in strategy.
Roth IRA Conversion
Another tactic worth considering would be to convert their traditional IRAs to a Roth IRA. That would come with several potential benefits, including more favorable tax implications for the surviving spouse and heirs.
Let's say our good friends Mark and Ann both convert their entire IRA balances to Roth IRAs over the course of 10 years and pay the tax on the conversion from the other assets available as a cash flow.
Guess what would happen in this scenario. The wealth for their heirs would increase by another $1.2 million, now bringing the total to $3.7 million.
Cash Value Life Insurance
Here's an additional proposal we could make to Mark and Ann. What if Mark were to buy a cash-value life insurance policy and pay a premium of $35,000 a year for seven years?
Mark and Ann's heirs would benefit more than ever. Because of the life insurance policy, the potential benefit has grown another $892,526, for a new total hovering in the $4.6 million range.
So let's review. Initially, the wealth going to the heirs was $1.2 million when Mark and Ann took the do-it-yourself approach. That increased to $1.9 million when they enlisted the help of a professional to manage their portfolio. But it catapulted to a whopping $4.6 million when good planning strategies came into play.
While the ability of your financial adviser to increase the returns in your portfolio is unknown, the potential value of good planning is obvious. That's why you want to make sure your financial adviser is not only a portfolio manager, but also a good financial planner.
Daniel Shub is the founder of OCTO Capital and Shub & Company. He holds the Registered Financial Consultant ® designation, has passed the Series 65 securities exam and is insurance licensed.
Rozel Swain contributed to this article.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Daniel Shub is the founder of OCTO Capital and Shub & Company. Since 1997, he has worked in the financial services industry, specifically focusing on clients' goals and wealth protection for retirement. He also authored the book, Retirement IQ. Shub holds the Registered Financial Consultant® designation, has passed the Series 65 securities exam and is insurance licensed.
-
Amtrak Joins Prime Day With Deals on Fares — But You’ll Have to Act Fast
Prime members can score 20% off midweek fares — what travelers should know before booking.
-
Mississippi Tax-Free Weekend 2025 Is Here: What to Know Before You Shop
Tax Holiday Just in time for Prime Day, Mississippi is celebrating a tax holiday in July. Find out how you can save on back-to-school essentials.
-
Key to Financial Peace of Mind: Think 'What's Next?' Rather Than 'What If?'
Even if you've hit your magic number for retirement, it's hard to stop worrying about money. Giving it a clear purpose is one way to reduce financial anxiety.
-
Three Estate Planning Documents a Business Owner Can't Afford to Skip
A business owner's estate plan should protect the company and its employees as well as the entrepreneur's heirs. These three documents are critical.
-
Financial Fact vs Fiction: Why Your 'Magic Number' Isn't Actually Magical
Do you think you're diversified if you're invested in the S&P 500 and Nasdaq? Do you think your tax rate will fall in retirement? Think again — and read on for other myths that could be leading you astray.
-
Opportunity Zones: An Expert Guide to the Changes in the One Big Beautiful Bill
The law makes opportunity zones permanent, creates enhanced tax benefits for rural investments and opens up new strategies for investors to combine community development with significant tax advantages.
-
Five Ways Retirees Can Keep Perspective Through Market Jitters
Market volatility is a recurring event with historical precedents (the dot-com bubble, global financial crisis and pandemic), each followed by recovery. Here's how people who are near or in retirement can navigate economic uncertainty.
-
I'm a Financial Strategist: This Is the Investment Trap That Keeps Smart Investors on the Sidelines
Forget FOMO. FOGI — Fear of Getting In — is the feeling you need to learn how to manage so you don't miss out on future investment gains.
-
How Advisers Can Steer Their Clients Through Market Volatility (and Strengthen Their Relationships)
Financial advisers need to be strategic when they communicate with clients during market volatility. The goal is to not only reassure them but to also help them avoid rash decisions, deepen your relationship with them and build lasting trust.
-
The Hidden Costs of Caregiving: Crisis Goes Well Beyond Financial Issues
Many caregivers are drained emotionally as well as financially, leading to depression, burnout and depleted retirement prospects. What's to be done?