Case Study: How One Son Helped His Parents Regain Control of Their Finances — and Protect Their Legacy
All names have been changed to protect client identity.
When Peter first called our office, he sounded like many adult children we hear from: concerned, overwhelmed, and unsure where to begin. He had recently visited his parents, John and Sally Rye, and noticed that bills were piling up on the kitchen table, unread and unpaid — and neither of his parents seemed concerned. That’s when Peter realized it was time to step in and help his parents manage their finances.
What he didn’t yet know was that his parents had a net worth approaching $20 million — and that stepping in would involve far more than just writing a few checks. This is the story of how we helped Peter simplify a complex financial picture, build a system for ongoing support, and work with the family’s attorney to preserve their wealth for the next generation.
1. The Situation: Private Wealth, Silent Burden
John and Sally Rye had always been very private people. They rarely discussed finances with their four children — Peter, Samantha, Jim, and Todd — and had never disclosed the true extent of their wealth. But as Peter soon learned, their assets totaled more than $20 million, including:
$1 million primary residence in Massachusetts
$10 million in IRAs/401(k)s (7 separate accounts)
$6 million in trust accounts (6 accounts)
$3 million in bank CDs, checking, and savings
Despite their financial means, their system was scattered. Statements were coming from every direction, and no one had a clear picture of how everything was connected — or whether anything was falling through the cracks.
2. Establish Authority and Build Trust
Peter contacted our firm after hearing how we specialize in helping adult children who are stepping in to manage their parents’ finances. He quickly provided copies of account statements, tax forms, and their full estate plan — a critical early step that helped us assess what we were dealing with.
Recognizing that it was becoming harder to manage their finances and stay current on bills, John and Sally decided it was time to hand over responsibility to their son. They named Peter as their Durable Power of Attorney and formally resigned as trustees of their respective trusts. With their estate attorney’s help, we coordinated the necessary steps to appoint Peter as the new acting trustee.
3. Consolidate and Simplify
Our next goal was to bring order to chaos. Across both retirement and non-retirement holdings, the family had:
7 retirement accounts (IRAs and 401(k)s)
6 trust accounts
Several non-trust accounts still titled jointly or individually
We processed rollovers and in-kind transfers to avoid triggering taxable gains during consolidation. All accounts were moved to Charles Schwab, creating four core accounts:
John’s IRA
Sally’s IRA
John’s Revocable Trust
Sally’s Revocable Trust
This allowed us to clearly separate taxable vs. tax-deferred assets, establish systematic Required Minimum Distributions (RMDs), and create visibility for Peter as trustee and POA.
4. Tax-Aware Rebalancing and Loss Harvesting
With all accounts consolidated, we reviewed the portfolio for unrealized gains and losses. Several positions were trading below cost, and we agreed to strategically harvest those losses first. This allowed us to rebalance the portfolio by selling highly appreciated positions that no longer aligned with the Ryes’ more conservative risk profile.
Because we paired gains with losses, these trades were executed without generating any net capital gains — a clear advantage of proactively managing tax lots during a transition.
5. Coordinate RMDs and Tax Planning
Both John and Sally were subject to RMDs. We helped:
Process direct RMDs from their legacy 401(k) accounts (prior to rollover)
Track and satisfy IRA RMDs
Establish a more efficient plan for future distributions, since RMDs going forward can now come from a single IRA per person
During this process, Peter also discovered that his parents had been making quarterly estimated tax payments — four to the IRS and four to the Massachusetts Department of Revenue each year.
To simplify their cash flow and reduce Peter’s administrative burden, we recommended eliminating estimated payments altogether and instead withholding sufficient taxes directly from their RMDs. This allowed us to rely on the IRS safe harbor rules, which treat withholding from retirement distributions as if it were made evenly throughout the year — regardless of timing.
This change meant:
No more setting up 8 separate payments per year
Fewer moving pieces for Peter to manage
A smoother, more automated way to stay compliant with both federal and state tax obligations
With consolidation complete, managing income and distributions became far easier — for both Peter and our team.
6. Sally Passes — and the Plan Is Put to the Test
Shortly after consolidation, Sally passed away. Because we had already consolidated accounts and cleaned up titling on most assets, we were in a strong position to act quickly and thoughtfully.
Working closely with Peter and the family’s estate attorney, we determined that John did not need all of Sally’s IRA to maintain his financial independence. Acting under POA, Peter helped John disclaim part of his right to Sally’s IRA — allowing $2 million of value to pass directly to the contingent beneficiaries, i.e., the four children.
This decision:
Made use of Sally’s $2 million Massachusetts estate tax exemption
Allowed the children to inherit assets that avoided estate taxes
Triggered 10-year inherited IRA rules for the children, who now each hold their own account with annual RMDs
7. Addressing Estate Tax Exposure
Massachusetts imposes an estate tax on estates that exceed $2 million, with rates reaching as high as 16%. After multiple discussions between Peter, his siblings, and the family’s estate attorney, the family agreed that gifting select non-retirement assets to the children — particularly those with only modest unrealized gains — made strategic sense.
Meanwhile, the most highly appreciated positions were intentionally retained in John’s name, ensuring the children could still benefit from a step-up in cost basis upon his passing.
8. The Result: Clarity, Control, and Confidence
Through Peter’s thoughtful involvement — and the support of trusted advisors — the Rye family transformed what could have been a stressful, disorganized transition into a thoughtful and efficient financial caregiving plan.
From over 15 disconnected accounts to just four
From multiple RMD sources to one
From disjointed tax payments to automated withholdings
From uncertainty to confidence and clarity
This case highlights what’s possible when financial caregiving is done intentionally — with the right tools, the right team, and a commitment to protecting both the parent and the legacy they’ve built.
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