Financing Your Future – Excerpt From The Financial Shepherd

Executive Summary: AI is changing how financial data is processed and how strategies are tested, but it doesn’t replace custom planning. It’s a tool, useful for automation and analysis, but not a substitute for real conversations, smart tax strategies, or long-term retirement planning built around your life.

You’ve seen the headlines. AI is writing resumes, generating images, analyzing portfolios, and supposedly coming for everyone’s job. But beyond the noise, what does artificial intelligence actually mean for your financial life? And more specifically, should it change how you approach retirement planning, investing, or managing your wealth?

The short answer: AI is changing how we gather information and make decisions, but it doesn’t replace thoughtful, personalized planning. Understanding where it helps (and where it doesn’t) can give you a smarter edge.

The Hype: What AI Won’t Do

Let’s start with what AI can’t do. It won’t magically make your money grow faster. It can’t predict market moves with certainty. And it definitely doesn’t understand your values, family goals, or long-term vision the way a human advisor can.

AI isn’t a magic formula. Many consumer apps promote automated investing and planning powered by “AI,” but in reality, much of what’s happening behind the scenes is rule-based algorithms, not true intelligence. These tools might help with surface-level budgeting or allocating assets based on basic inputs, but they aren’t building a tax-efficient retirement drawdown plan or stress-testing your estate strategy.

In short, AI can process data fast. But fast doesn’t mean personal.

The Value: Where AI Actually Helps

AI is already changing how data is analyzed, models are run, and financial strategies are tested. And in that sense, it’s incredibly useful for both investors and the advisors who support them.

Here are a few real ways AI is improving financial and retirement planning:

• Faster data analysis: AI tools can sift through large amounts of financial data in seconds, identifying trends or tax opportunities that would take hours to spot on your own.
• Better portfolio modeling: AI can help stress-test portfolios against hundreds of economic scenarios, helping ensure your plan holds up across different market conditions.
• More personalized content: AI can help generate relevant financial education, summaries, and reminders based on your goals and behaviors.
• Time-saving automation: From pulling in account data to running projections, AI tools streamline technical work, allowing planners to focus more on strategy.

But the biggest upside? AI enhances human work. It gives financial professionals more tools, not less relevance. It doesn’t replace judgment, nuance, or personal context. If anything, it makes the human element more valuable.

What It Means for Your Financial Life

If you’re in your peak earning years, running a business, or getting serious about retirement planning, AI tools may already be supporting some of the systems that power your financial plan. But that doesn’t mean you should hand the wheel over.

Here’s how to think about AI as part of your planning process:

• Use AI as a filter, not a decision-maker. Let it help surface ideas, but let real strategy drive the choices.
• Ask how your planning team is using technology. Are they using AI to improve efficiency, catch opportunities, and provide better insights? That’s a good sign.
• Focus on custom solutions. AI can’t replace a plan that accounts for your tax profile, family structure, charitable goals, and retirement income strategy.

Whether you’re looking at Roth conversions, capital gains planning, or legacy planning, the best outcomes still come from asking the right questions, not just crunching numbers faster.

The Bottom Line on AI and Retirement Planning

AI is real. It’s improving the tools behind financial services and helping people get better access to planning support. But it isn’t magic. It can’t replace a conversation, a custom strategy, or a long-term relationship.

The core of retirement planning hasn’t changed. You still need to:

• Build a tax-efficient plan to accumulate and withdraw money
• Protect what you’ve built from unnecessary risk
• Align your finances with your family, health, and purpose

Technology helps us do that better. But it doesn’t do it for you.

Real Planning Still Matters

AI may help you obtain information more quickly, but building wealth, reducing taxes, and creating a legacy still require personal attention. At Worth Advisors, we utilize various tools, including smart technology, but your plan begins with what matters most to you. If you want a financial strategy built for your real life (not just the algorithm), let’s talk.

Disclaimer: The information contained in this article is intended for discussion purposes only. The information included herein is highly confidential, intended for review by the recipient only, and should not be disseminated or made available for public use or to any other source. It is not an offer or a solicitation for the sale of a security, nor shall there be any sale of a security in any jurisdiction where such offer, solicitation, or sale would be unlawful. An investment with Worth Advisors (whether through a commingled fund or on a separate account basis) involves a degree of risk and may only be made pursuant to the respective offering documents and organizational materials governing such investment. Past performance of the clients of Worth Advisors, or any of its employees or principals, may not be indicative of future results, and there is no guarantee that targeted performance will be achieved. The entirety of investors’ capital is at risk.

Executive Summary: Sudden wealth can be a gift or a burden, depending on how prepared the next generation is to receive it. Start with financial education, use a phased wealth transfer strategy, clarify your values, prepare for taxes, and communicate clearly. A thoughtful plan can make all the difference.

Whether you’re curious or skeptical, it’s hard to ignore cryptocurrency these days. It’s been called everything from the future of finance to a worthless scam. But in between the hype and fear lies a more practical truth: crypto is neither a magic money machine nor something to dismiss entirely. For investors who want to make informed decisions, separating myth from reality is essential.

At Worth Advisors, we don’t treat crypto like a trend. We treat it like any other financial decision: with context, planning, and a focus on what makes sense for each individual client. If you’re a high-income earner, business owner, or nearing retirement, here’s what you actually need to know about crypto.

Myth #1: Crypto Is a Guaranteed Path to Wealth

Reality: Crypto has produced big winners, but also big losers. Yes, there are stories of people who made millions buying Bitcoin early. But timing markets, especially crypto markets, is risky at best. Prices are volatile, and massive swings can happen within hours.

As with any investment, it’s not about chasing trends. It’s about making sure any exposure fits your goals, time horizon, and risk tolerance. For most people, crypto should be a small portion of a diversified portfolio, if it’s in the portfolio at all.

Myth #2: Crypto Is Completely Anonymous and Untraceable

Reality: Crypto transactions are recorded on public blockchains. While they don’t always include names or bank accounts, transactions can be traced, especially by government agencies.

If you’ve heard crypto is ideal for avoiding taxes or hiding money, be careful. The IRS is increasing enforcement, and crypto platforms are now required to issue tax documents much like brokerages do. Any gains from trading or selling crypto are taxable. Ignoring that is a fast track to a tax problem.

Myth #3: You Have to Be a Tech Expert to Invest in Crypto

Reality: You don’t need to understand blockchain development or code to buy crypto. But you do need to understand what you’re buying, how you’ll store it, and how it fits into your overall plan.

There are now user-friendly platforms and custodians that make crypto more accessible. Some investment platforms even offer crypto ETFs or trusts that provide exposure without managing coins directly. The important part is understanding the risks, fees, and how crypto interacts with your broader financial picture.

Myth #4: Crypto Replaces the Need for Traditional Investing

Reality: Crypto is still speculative. It doesn’t generate dividends or income, and its value is driven mostly by supply, demand, and market sentiment. It is not a substitute for long-term investment strategies based on fundamentals, diversification, and planning.

Even the most enthusiastic investors should view crypto as a potential satellite investment, something that adds diversification but doesn’t replace core retirement planning, tax strategies, or estate planning.

Myth #5: If You Missed Bitcoin, You Missed Your Chance

Reality: The idea that you “missed the boat” can lead to rushed decisions. There are thousands of cryptocurrencies, but very few have lasting utility or widespread adoption. Investing in newer coins often carries more risk, not more opportunity.

There is no urgency to jump into crypto just because others are doing it. A better approach is to determine whether it belongs in your plan at all, and if it does, how to approach it responsibly.

What We Tell Clients Considering Crypto

• If you’re interested, start small. Don’t invest more than you’re willing to lose.
• Don’t fund crypto purchases with debt or money earmarked for other goals.
• Stay updated on tax rules and reporting requirements.
• Use secure storage, whether that’s a reputable exchange or offline solution.
• Talk to your advisor about how crypto affects your risk profile, taxes, and long-term goals.

Crypto may have a place in your portfolio, but it should never drive your entire strategy.

Your Strategy Should Reflect Reality, Not Hype

You don’t need to be all-in or all-out when it comes to crypto. What matters is whether it fits your financial plan, your risk tolerance, and your long-term goals. At Worth Advisors, we help you take a clear, grounded approach to your money, even when the markets feel unpredictable. If you’re considering crypto or have questions about how it impacts your broader strategy, we’re here to have the real conversation.

Disclaimer: The information contained in this article is intended for discussion purposes only. The information included herein is highly confidential, intended for review by the recipient only, and should not be disseminated or made available for public use or to any other source. It is not an offer or a solicitation for the sale of a security, nor shall there be any sale of a security in any jurisdiction where such offer, solicitation, or sale would be unlawful. An investment with Worth Advisors (whether through a commingled fund or on a separate account basis) involves a degree of risk and may only be made pursuant to the respective offering documents and organizational materials governing such investment. Past performance of the clients of Worth Advisors, or any of its employees or principals, may not be indicative of future results, and there is no guarantee that targeted performance will be achieved. The entirety of investors’ capital is at risk.

Executive Summary: Sudden wealth can be a gift or a burden, depending on how prepared the next generation is to receive it. Start with financial education, use a phased wealth transfer strategy, clarify your values, prepare for taxes, and communicate clearly. A thoughtful plan can make all the difference.

Most people focus on growing wealth. Few spend enough time thinking about what happens when that wealth transfers, especially to the next generation. If you’re building real financial security, you’ve probably asked yourself: Will my kids or heirs be ready? Sudden wealth, whether it comes from an inheritance, business sale, or financial windfall, can be overwhelming. Without preparation, it can do more harm than good.

Passing down wealth is about more than numbers. It requires education, structure, and clear communication. At Worth Advisors, we’ve seen the impact of thoughtful planning, and we’ve also seen what happens when families skip this step. If you want your legacy to support and not derail the next generation, here’s where to start.

1. Start with Financial Education

The first step is teaching basic financial literacy. That includes budgeting, saving, investing, taxes, and debt management. Don’t assume the next generation already knows how to manage money just because they grew up around it.

Many families begin with open conversations about how money works, how it should be used, and how values play a role in financial decisions. Whether your children are in high school or adults with families of their own, it’s never too early to start these conversations.

Consider involving your children in aspects of your financial process, such as tax planning discussions or investment reviews. They don’t need full access, but they do need context. When the time comes for a wealth transfer, they’ll feel more capable and less intimidated.

2. Use a Gradual Wealth Transfer Strategy

Instead of leaving a lump sum, consider phasing in wealth over time. This approach gives the next generation time to learn, adapt, and develop their own financial habits with some safety nets in place.

Tools like incentive trusts, annual gifts, or structured disbursements can be helpful here. They allow you to share wealth while maintaining some level of oversight or guidance. You can also require financial education milestones before certain distributions are made.

A gradual strategy isn’t about control, it’s about support. It helps build confidence and responsibility, which leads to smarter decisions long-term.

3. Align Your Plan with Family Values

Sudden wealth can lead to confusion, disagreement, or even conflict when expectations aren’t clear. That’s why it helps to document and discuss your intentions.

What are your priorities? What matters most to you about how the money is used? Whether it’s supporting education, funding charitable efforts, or building a family business, sharing your values with the next generation provides a framework for responsible stewardship.

In many cases, we work with families to build a legacy letter or family financial charter that clearly outlines these intentions in plain language.

4. Protect Against Tax Surprises

Sudden wealth can come with unexpected tax consequences. A large inheritance, real estate sale, or trust distribution could move your heirs into a higher tax bracket overnight.

Helping them understand the tax implications of wealth can prevent poor decisions. This includes income tax, capital gains, and estate tax awareness. Collaborating with advisors ahead of time can help ensure that the next generation receives wealth in the most tax-efficient way possible.

This is especially important for high-income earners and business owners who may be managing both incoming assets and existing tax liabilities. Coordinated tax planning protects the legacy and increases what’s passed on.

5. Communicate Early and Often

Silence doesn’t help anyone. One of the most common issues we see is a lack of communication between generations. Without context or clarity, sudden wealth can feel more like pressure than opportunity.

Set clear expectations. Share your reasoning. Invite questions. If you have a financial team in place, consider introducing your children to them now. That familiarity can go a long way toward trust, continuity, and better outcomes.

Creating sustainable, generational wealth isn’t just about money, it’s about mindset. And mindset starts with open communication.

Build the Future with Intention

Wealth transfer isn’t just a transaction. It’s a turning point. Whether you plan to give during your lifetime or after, setting the next generation up for success takes time, clarity, and intention. At Worth Advisors, we work with families to create tailored plans that prepare heirs, not just for the money, but for the responsibility that comes with it. Contact us today to learn more.

Disclaimer: The information contained in this article is intended for discussion purposes only. The information included herein is highly confidential, intended for review by the recipient only, and should not be disseminated or made available for public use or to any other source. It is not an offer or a solicitation for the sale of a security, nor shall there be any sale of a security in any jurisdiction where such offer, solicitation, or sale would be unlawful. An investment with Worth Advisors (whether through a commingled fund or on a separate account basis) involves a degree of risk and may only be made pursuant to the respective offering documents and organizational materials governing such investment. Past performance of the clients of Worth Advisors, or any of its employees or principals, may not be indicative of future results, and there is no guarantee that targeted performance will be achieved. The entirety of investors’ capital is at risk.

If you’re thinking about passing down wealth to family or loved ones, it can be tempting to just write a check and call it a day. It’s simple, quick, and requires almost no planning. But is that the smartest move for your legacy? Not always. When you’re dealing with significant wealth, how you transfer it matters just as much as how much you give. Whether you choose direct gifts or set up a trust can affect taxes, control, and what your heirs actually receive.

The Case for Direct Gifts

Giving directly to your heirs can feel straightforward. You can gift up to $19,000 per person per year (as of 2025) without triggering federal gift taxes. For many families, this is a simple way to share wealth while you’re still alive.

Direct gifts provide recipients with immediate access to the funds. That’s great if they need help with a home purchase, education costs, or starting a business. It also removes those assets from your taxable estate, potentially reducing estate taxes upon your passing.

However, direct gifts come with downsides. Once the money is gifted, you have no control over how it’s used. There are also risks if the recipient isn’t financially responsible or faces legal or financial troubles. Money given without structure can disappear quickly, leaving little long-term impact. And for larger gifts, you might run into gift tax limits or miss out on smarter tax strategies that could have preserved more of your wealth.

Another consideration is how direct gifts might impact the recipient’s own financial situation. A sudden influx of cash can complicate things like financial aid eligibility for education, create tax consequences, or even lead to disputes within the family if not communicated properly.

Why Trusts Might Be the Better Option

A trust provides a structured way to pass down wealth while keeping some control over how and when assets are used. You can create specific rules, such as delaying access until a certain age or earmarking funds for education, healthcare, or purchasing a home. This helps ensure that the money supports responsible decisions and benefits multiple generations.

Trusts also offer tax benefits and asset protection. Assets placed in certain types of trusts may be shielded from creditors, lawsuits, or divorce settlements. This can be particularly useful if you have concerns about an heir’s financial stability or their exposure to legal risks.

Additionally, trusts can help manage estate taxes and provide privacy since trust assets don’t go through probate, which is a public process. This not only speeds up the transfer of assets but also keeps family matters and wealth details confidential.

There are several types of trusts to consider, such as:

• Revocable Trusts: Allow you to retain control of the assets during your lifetime and adjust the trust as needed.
• Irrevocable Trusts: Once established, these can’t be easily changed but offer stronger asset protection and potential tax benefits.
• Generation-Skipping Trusts: Designed to pass assets directly to grandchildren, minimizing estate taxes across generations.
• Charitable Trusts: Enable you to support charitable causes while providing tax advantages and income streams for family members.

Setting up a trust requires more planning, legal support, and upfront costs compared to making direct gifts. But the long-term benefits, especially for substantial estates, can be well worth the effort.

Which Option Is Right for You?

Choosing between direct gifts and trusts isn’t always an either-or situation. In many cases, a blended strategy works best. You might give smaller direct gifts to help loved ones with immediate needs while setting up a trust to protect and manage the rest of your assets for the future.

The decision often comes down to your specific goals:

• Do you want to provide immediate support, or ensure long-term stewardship of your wealth?
• Are you concerned about tax implications?
• Do you want to protect assets from potential legal issues?
• How much control do you want over how your wealth is used after you’re gone?

Answering these questions can help guide the right approach for your family and financial legacy.

Choose the Right Strategy for Your Legacy

Passing down wealth isn’t just a financial decision, it’s a values decision. At Worth Advisors, we help you determine the best strategy for your situation, whether that involves direct gifts, trusts, or a combination of both. Let’s build a plan that protects your legacy and supports the next generation the way you intend.

You’ve probably heard the warnings: “Social Security is running out of money.” It’s a headline that gets clicks but also sparks genuine concern. If you’re in your 30s, 40s, or even 50s, it’s fair to wonder whether Social Security will be there for you by retirement. The truth? Social Security isn’t going away—but it will likely look different. And understanding what might change can help you build a better plan.

The Reality Behind the Headlines

Let’s clear something up first: Social Security is not going bankrupt. Yes, the program is under financial pressure, and the Social Security Trust Fund is projected to be depleted by the mid-2030s if no changes are made. But even if that happens, payroll taxes will still cover about 75-80% of scheduled benefits. That means the program won’t disappear, but benefits may be reduced unless reforms are passed.

Lawmakers have several ways to strengthen Social Security. They could raise the retirement age, adjust how benefits are calculated, increase the payroll tax cap, or use a combination of approaches. These reforms have been made in the past and are likely to happen again.

The key takeaway: Social Security is not in danger of vanishing. But relying solely on it to fund your retirement isn’t a good plan. It should be one part of a broader retirement strategy.

What You Can Do Right Now

1. Don’t Count on Social Security Alone: Social Security was never meant to be your only source of income in retirement. It’s a foundation, not a complete plan. Make sure you’re saving in retirement accounts like a 401(k), IRA, or other investment vehicles.
2. Stay Informed, But Not Anxious: Yes, Social Security faces challenges. But that doesn’t mean you need to panic. Keep an eye on proposed policy changes and be ready to adjust your expectations, but avoid making emotional decisions based on headlines.
3. Plan for Multiple Income Sources: Your retirement income should come from multiple places. Diversify with savings, investments, pensions (if available), and even part-time work or rental income if that fits your lifestyle.
4. Consider Delaying Benefits: To boost your future Social Security payout, consider delaying benefits past your full retirement age. Your benefit increases each year you wait (up to age 70).
5. Revisit Your Retirement Plan Regularly: As policies change, your plan should evolve too. Regular check-ins align with your goals, no matter what happens with Social Security.

Stay Focused on What You Can Control

Worrying about whether Social Security will change doesn’t help you prepare, but taking action does. The more you take control of your retirement planning today, the less you’ll have to worry about changes tomorrow.

At Worth Advisors, we help you build a plan that works with or without Social Security. Let’s ensure you’re set up for the future you want, no matter what changes may come.