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Building wealth is a challenge. Making sure it lasts longer than you do is another. For retirees focused on leaving a lasting financial legacy, the strategies that matter most in 2026 go far beyond a basic bequest or savings account.
Aaron Channing, Partner and Personal Wealth Advisor Fortivus Wealth GroupA private client group from Northwestern Mutual shares five tricks they recommend to clients who want their assets to work for the next generation (and beyond!).
1. Take advantage of 529 plans for grandchildren
A 529 education savings plan is one of the most tax-efficient tools available for transferring money to grandchildren. Contributions grow tax-free, and withdrawals for qualified education expenses also grow tax-free, creating compound benefits that can last for decades.
Channing pointed to a lesser-known strategy called front-loading, which allows married couples to contribute annual gifts for up to five years at once per beneficiary. Those assets leave the taxable estate immediately while the grandparents retain control over how the money is ultimately used.
2. Set up a trust fund for controlled and tax-efficient transfers
A well-structured trust does more than transfer assets. It protects them. Channing said properly designed trust funds shield transferred assets from creditors, divorce settlements and poor financial decisions by beneficiaries – risks that direct inheritance does nothing to address.
Grantors can create specific distribution rules tied to age limits, educational milestones or other life events, helping to ensure that funds are protected and used responsibly, rather than quickly depleted by heirs who may not be prepared to manage a large inheritance.
3. Use life insurance to create liquidity and preserve wealth
Life insurance is often underestimated as an estate planning tool. Channing said it plays a strategic role by providing immediate liquidity upon death, which can be used to cover estate taxes or other obligations without forcing heirs to sell family assets (real estate, investments, closed businesses, etc.) at the wrong time.
In addition to covering costs, life insurance proceeds can also serve as a direct, tax-efficient wealth transfer that lays a financial foundation for children and grandchildren without disrupting comprehensive estate planning.
4. Maintain a diversified investment portfolio
Market volatility never stops mattering in retirement, especially when the goal is to preserve wealth across generations. Channing said spreading investments across asset classes, geographies and strategies reduces the risk that any recession will cause permanent damage to a family’s financial position.
Diversification in this context is not just about protecting what exists today. It is about supporting sustainable development that keeps assets intact long enough to benefit grandchildren and great-grandchildren.
5. Involve the family in the planning process
Channing said this is often the most overlooked strategy of all. The technical elements of estate planning mean nothing if the people inheriting the estate do not understand it or are not prepared to manage it well.
Including children and grandchildren in financial planning conversations improves outcomes. Families that talk openly about money have less conflict, stronger management, and are more likely to see the wealth benefit multiple generations rather than disappear in a single generation.