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The Datalign Financial Guide

High Net Worth · 2026 Edition

What do I want my wealth to make possible?

For households with $1M+ to invest. Worked examples on retirement income, taxes and passing on wealth — and how to judge an advisor.

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High Net Worth

4 parts · 16 exhibits · 7 questions

Cambridge, MA

Net worth

FOLIO 123

$2,150,000

Everything you own − everything you owe

Investable

FOLIO 862

$1,630,000

Retirement + brokerage + cash

Step-up

Form CRS

You’ve made financial decisions for years.
Some of the next ones may be new to you.

Simple worked examples, with sources cited along the way.

Created by The Datalign Content Team · Reviewed by Samuel Carter, Chief Compliance Officer

Examples are illustrative, not recommendations. Datalign is registered with the U.S. SEC — see disclosures below.

Part 1 · Understand the wealth you have

How much do you have — and how fast could you reach it?

Net worth is what you own minus what you owe. Investable assets leave out your home. How fast each turns to cash matters too.

Exhibit 2 · One household’s balance sheet

Net worth and investable assets

What you own

Home (current market value)

$900,000

Traditional 401(k) and IRA

$1,100,000

Brokerage account

$450,000

Cash and savings

$80,000

Car (current value)

$30,000

Total assets

$2,560,000

What you owe

Mortgage

$400,000

Car loan

$10,000

Total liabilities

$410,000

Net worth

$2,150,000

Assets − liabilities

Investable assets

$1,630,000

Retirement, brokerage and cash, before tax

Hypothetical. Investable assets are the retirement, brokerage and cash accounts, shown before tax. Firms commonly describe $1M or more in investable assets as high net worth; these are conventions, not regulatory definitions.

Most of this household’s investable money sits in retirement accounts, where withdrawals are taxed. Investable isn’t spendable.

Exhibit 3 · Two households, each with $1.5 million

How quickly could each turn its assets into cash?

Household A

$700K

$600K

$200K

Household B

$900K

$450K

Cash

Available now. No sale required.

Diversified investments

Usually sold within days; gains may be taxed.

One company’s stock

Quick to sell, but tied to one company.

Retirement accounts

Taxed as income; early withdrawals may be penalized.

Private business

Slow to sell and hard to value.

Hypothetical, before taxes. Household B also holds $100K in retirement accounts and $50K in cash.

Same $1.5 million. Household A can reach most of it in days. Household B can’t.

Review what your assets are made of

Review your assets with an advisor

Review what your assets are made of

Part 2 · Make decisions about your investments

When you sell, what actually gets taxed?

You’re taxed on the gain, not the sale. Which account you use, and how much rides on one stock, change the answer.

Exhibit 4 · Selling shares that cost $60,000 for $100,000

Only the gain is potentially taxable

You sell for

$100,000

What you receive

You paid (cost basis)

− $60,000

Returned to you, not taxed

Realized gain

= $40,000

Potentially taxable

Hypothetical, taxable brokerage account, federal tax only. IRS Topic No. 409, Capital gains and losses.

Held over a year, that gain is generally taxed at 0%, 15% or 20%. A year or less, it’s taxed like wages.

Exhibit 5 · Three ways to withdraw $100,000

The account you draw from changes what’s taxed

Sell brokerage investments

You receive $100,000

Potentially subject to tax

$40,000

Capital gain — the shares cost $60,000

Withdraw from a traditional IRA

You receive $100,000

Potentially subject to tax

$100,000

Ordinary income — all contributions were pretax

Use cash savings

You receive $100,000

Potentially subject to tax

No new income tax

Hypothetical; the taxable amount is not the tax owed. B assumes every contribution was deducted when made; before age 59½ a 10% additional tax may apply. Federal tax only. IRS Topic No. 409; IRS Publication 590-B.

Each route has a cost. The right mix depends on your tax bracket that year.

Exhibit 6 · A 50% drop in one stock, in a $2 million portfolio

How much of your wealth depends on one investment?

Before

One stock · $800K

Everything else · $1.2M

$2.0M

After

$400K

−$400K

$1.2M

$1.6M

−20%

drop in the whole portfolio when one stock falls 50%.

Hypothetical. Assumes the rest of the portfolio is unchanged. Diversification can reduce exposure to one company, although it cannot prevent investment losses. FINRA, “Love Your Company Stock? Here’s What to Know”.

Exhibit 7 · Selling half of a $1.5 million position

What happens when Alex sells $750,000 of stock?

Alex (fictional) has $1.5M of one stock in a $4M portfolio, bought for $300,000.

Before · share of $4M in one stock

37.5%

After · share of $4M in one stock

about 19%

Sold

$750,000

Cost of those shares

− $150,000

Realized gain

= $600,000

Taxable in the year of the sale

Hypothetical. Assumes the $750,000 is reinvested outside the stock before any tax is paid and the share price is unchanged, so the portfolio stays at $4 million. If the full gain were taxed at the 20% federal long-term rate plus the 3.8% net investment income tax, federal tax would be $142,800. Alex’s actual tax depends on other income, deductions, losses and state tax. IRS Topic No. 409; IRS Topic No. 559.

Selling half cuts Alex’s exposure in half — but creates a $600,000 taxable gain this year.

Four things to review before selling a large position

The tax this year

Your holding period, other income, losses and state tax.

Your remaining concentration

How much would still ride on one company?

What the money is for

Spending, saving or reinvesting changes how much to sell.

Your other plans

Giving shares directly is taxed differently from selling first.

Ask an advisor:

“If I reduce this position, how much would you sell, over what period, and why?”

Talk through a planned sale with an advisor

Talk through a planned sale

Talk through a planned sale with an advisor

Part 3 · Plan your retirement income

Where will the money come from once the paychecks stop?

Find the gap your savings must fill. Then decide where to draw from, and when.

Exhibit 8 · A hypothetical household’s yearly funding gap

How much will your savings need to provide?

Expected yearly spending

$140,000

−

Social Security and pension income

$55,000

=

Needed from savings and investments

$85,000

Hypothetical yearly figures. Taxes on withdrawals could raise the amount needed. Not a recommended withdrawal amount.

$85,000 is a starting point. Inflation, taxes and returns will move it.

Exhibit 9 · Sources of $100,000 in one year

Where will your retirement income come from?

A retired couple’s $100,000 for the year, before tax.

Social Security · $40,000

IRA / 401(k) · $35,000

$15,000

$10,000

Social Security · $40,000

Up to 85% may be taxable, depending on other income.

Traditional IRA or 401(k) · $35,000

Taxed as ordinary income.

Taxable brokerage · $15,000

Taxed only on the gain in the shares sold.

Cash savings · $10,000

No new tax.

Hypothetical; not a recommended mix. The $100,000 is money received before taxes; the amount available to spend depends on the couple’s actual tax liability.

Same $100,000, four tax treatments. The mix shapes your tax bill.

Exhibit 10 · How three account types compare

In what order should you draw from retirement accounts?

Account

How withdrawals are taxed

What else to know

What to discuss with an advisor

Traditional IRA or 401(k)

Taxed as income, assuming pretax contributions

Required withdrawals start at 73 or 75

How much to take each year given your bracket

Taxable brokerage

Only the gain on shares sold

Losses can offset gains

Which holdings to sell, and when

Roth IRA

Qualified withdrawals are generally tax-free

No required withdrawals for the original owner

When to use it and when to leave it invested

Roth withdrawals are qualified after age 59½ from an account open at least five years. IRS Publication 590-B; IRS, Retirement plan and IRA required minimum distributions FAQs.

The order you draw from accounts changes your taxable income each year.

Claim at 62: about 70% of the full benefit. Wait until 70: about 124%.

Exhibit 12 · When required minimum distributions (RMDs) begin

When must you start withdrawing from retirement accounts?

Born 1951–1959

Age 73

first required withdrawal

Born 1960 or later

Age 75

first required withdrawal

Savings in a traditional IRA or 401(k) can’t stay in the account indefinitely. Each year’s RMD is based on the account balance and an IRS life-expectancy factor. Roth IRAs have no RMDs for the original owner. IRS, Retirement plan and IRA required minimum distributions FAQs.

RMDs are taxed as income — whether or not you need the money.

Plan your retirement withdrawals with an advisor

Plan your withdrawals with an advisor

Plan your retirement withdrawals with an advisor

Part 4 · Prepare your estate and giving plans

Who actually receives your assets — and what will the tax be?

Your will doesn’t control everything. How you give changes what people keep.

Exhibit 13 · How three of Morgan’s assets could pass

Your will may not determine who receives every asset

Morgan’s will leaves everything to Sam. But some accounts follow their own instructions, which generally override a will.

Asset

What generally controls it

Who may receive it

Home

In Morgan’s name alone

Morgan’s will

Passes through probate (court settlement)

Sam

As the will intends

IRA

Retirement account

Beneficiary form

Still names a former spouse

Former spouse

Depending on state law and plan rules

Brokerage account

Joint with a partner, with right of survivorship

How the account is owned

The surviving owner receives it

Partner

Not Sam

Hypothetical. Outcomes depend on state law, account terms and how each asset is titled. FINRA, “Advance Planning for Your Investments”.

One old form or joint account can override a will. Keep your paperwork in line with your plan.

Exhibit 14 · Which documents apply when

What do estate-planning documents do?

During your lifetime

Financial power of attorney

Someone to handle your finances if you can’t.

Healthcare directive

Your medical wishes, and who decides for you.

At death

Will

Who gets what’s in your name, and who settles it.

Beneficiary designations

Who receives accounts and policies outside your will.

Both

Trust

Can manage assets in life and pass them on, generally without probate.

Rules vary by state. An estate attorney drafts these documents; a financial advisor works alongside the attorney to keep account ownership, beneficiary forms and investments in line with the plan. FINRA, “Advance Planning for Your Investments”.

Exhibit 15 · Giving $50,000 of shares that cost $10,000, held over a year

How should you give to charity if your investments have grown?

Sell the shares, then give the cash

Charity receives

$50,000

Realized capital gain

$40,000

Tax on that gain

Owed at your rate

Possible deduction

Up to $50,000*

Give the shares directly

Charity receives

$50,000

Realized capital gain

Tax on that gain

None from the gift

Possible deduction

Up to $50,000*

*Subject to limits. Hypothetical; eligible public charity. Deductions require itemizing and are generally limited to 60% of adjusted gross income (AGI) for cash and 30% for appreciated stock. From 2026, only giving above 0.5% of AGI is deductible, and in the 37% bracket each deducted dollar reduces tax by at most 35 cents. IRS Publication 526; Public Law 119-21.

Giving shares directly may avoid tax on the gain. Check the deduction before you sell.

Exhibit 16 · A child sells shares for $200,000 that the parent bought for $50,000

Should you give investments to family now, or leave them in your estate?

Given during the parent’s life

Child’s cost basis

$50,000

Sale price

$200,000

Taxable gain

$150,000

Inherited at the parent’s death

Child’s cost basis

$200,000

Sale price

$200,000

Taxable gain

2026: gifts up to $19,000 per person generally need no gift tax return. Lifetime exemption: $15 million per person.

Hypothetical. Assumes the shares are worth $200,000 at the parent’s death and the child sells at that value. Gifted shares generally keep the giver’s cost basis; inherited shares generally take a basis equal to their fair market value at death, with some exceptions. IRS Publication 551; IRS, “What’s new — Estate and gift tax”.

Gifted shares keep the parent’s cost. Inherited shares generally reset it. Same sale, very different tax.

Discuss gifts and your estate with an advisor

Discuss gifts and your estate

Discuss gifts and your estate with an advisor

Working with a financial advisor

Seven questions to ask before you hire an advisor

Bring these to any first meeting — including one through Datalign.

Exhibit 1 · Illustrative effect of a 3-point annual difference over 25 years

Professional advice can make the difference

Up to 3%

Vanguard estimates advice can add up to 3% a year in net returns. The value varies by client and isn’t steady year to year.

Starting value

6% · 25 yrs

9% · 25 yrs

$1M invested

$4.3M

$8.6M

$2M invested

$8.6M

$17.2M

$5M invested

$21.5M

$43.1M

2×

3 points a year nearly doubles the result over 25 years.

Source: Vanguard, “Celebrating Vanguard Advisor’s Alpha: Clients and Their Advisors Thriving Together for 25 Years,” 2025. Exhibit 1 is illustrative only: it assumes 6% and 9% annual returns compounded over 25 years to show the effect of a 3-percentage-point difference. It does not represent the performance of any advised portfolio, any Datalign-matched advisor or any actual client, and is not a guarantee of future results. Vanguard is not affiliated with Datalign.

Advisor meeting checklist

Advisor: ____________ Date: ________

What experience do you have with financial circumstances like mine?

How do you coordinate investment decisions with tax planning?

How would you assess concentration risk in my portfolio?

How would you help me plan retirement income and withdrawals?

How do you handle estate planning and giving — and when do you bring in an attorney?

How are you compensated, and what would I pay in total?

Fees may be a % of assets, flat, hourly or commission. The firm’s Form CRS lists them. Datalign’s introduction is free.

What would you need to know before recommending changes?

SEC, Investment Adviser Public Disclosure; Investor.gov, “Form CRS”.

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Ready to ask these questions? Get matched with an advisor

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Important disclosures

The information in this guide is for educational purposes only and is not intended as, nor should it be relied upon as, individualized financial, investment, tax, or legal advice, and you should consult a qualified professional about your specific circumstances before making any financial decisions.

Financial Matchmaker & Advertising Disclosure: Datalign / Datalign Advisory is registered with the U.S. Securities and Exchange Commission as a Registered Investment Advisor providing advertising-supported referral services, and is not a registered broker-dealer. Content, tools, and calculators are for educational and informational purposes only and do not constitute personalized financial, tax, or investment advice. Registration with the SEC does not imply a certain level of skill or training. We match you with participating independent financial advisors; we do not recommend specific investments or guarantee advisor performance. Advisors matched through Datalign are independent of Datalign, and Datalign does not supervise the advice they provide. Datalign receives economic compensation from participating advisors for these referrals, which may influence how and where options appear on our platform. Past performance is no guarantee of future results. Always consult a qualified financial professional before making investment decisions.

Awards: FinTech Breakthrough named Datalign Advisory “Financial Advisory Platform of the Year” in its 2026 FinTech Breakthrough Awards, announced March 19, 2026. An independent panel selected winners from nominations submitted by January 9, 2026, for products released or updated after January 1, 2023. FinTech Breakthrough states that companies do not pay to be considered or to be named winners. Informa’s Wealth Management Group named Datalign Advisory a finalist in the 2026 Wealth Management Industry Awards (the “Wealthies”), announced June 3, 2026, in two categories: AI: Marketing and Lead Generation (RelationshipAI) and Innovation Platforms (AI-Native Growth Platform). Independent judges selected finalists from initiatives introduced or enhanced in the prior 18 months. Informa states that no fee is required to enter. These awards recognize Datalign’s technology platform. They are not ratings of any advisor you are matched with and do not indicate future performance. Barron’s Top 100 RIA Firms (2025) is compiled by Barron’s based on data submitted by firms, including assets, revenue and quality of practice; the ranking is not an endorsement of any firm or of Datalign, and Datalign did not pay Barron’s to be included.

Classifications such as “high net worth” are industry conventions, not regulatory definitions, and vary by institution. Meeting a classification threshold does not establish eligibility for any product or service. Alex (Exhibit 7), Morgan (Exhibit 13) and the other households, portfolios, donors and families in this guide are fictional, and all hypothetical figures are illustrative only; they do not represent actual investors, advised portfolios or results. Tax figures reflect federal law for 2026, exclude state taxes and may change. Retirement, Social Security, estate and giving examples simplify rules that depend on individual circumstances, account terms and state law. Datalign does not provide tax or legal advice; estate documents should be prepared by an attorney. Third-party figures are cited where they appear. Datalign is not affiliated with Vanguard, Capgemini or Barron’s, and references to government or regulatory sources do not imply their endorsement.

Information is current as of October 26, 2026. One Kendall Square, Cambridge, MA 02139 · datalign.com · © 2026 Datalign Advisory · Registered with the U.S. Securities and Exchange Commission · Perfectly Aligned Finance™

What do I want my wealth to make possible?

$2,150,000

$1,630,000

You’ve made financial decisions for years. Some of the next ones may be new to you.

Inside the guide

Understand the wealth you have

Make decisions about your investments

Plan your retirement income

Prepare your estate and giving plans

How much do you have — and how fast could you reach it?

Net worth and investable assets

How quickly could each turn its assets into cash?

When you sell, what actually gets taxed?

Only the gain is potentially taxable

The account you draw from changes what’s taxed

Sell brokerage investments

Withdraw from a traditional IRA

Use cash savings

How much of your wealth depends on one investment?

$2.0M

$1.6M

What happens when Alex sells $750,000 of stock?

Four things to review before selling a large position

The tax this year

Your remaining concentration

What the money is for

Your other plans

Where will the money come from once the paychecks stop?

How much will your savings need to provide?

$140,000

−

$55,000

=

$85,000

Where will your retirement income come from?

In what order should you draw from retirement accounts?

Traditional IRA or 401(k)

Taxable brokerage

Roth IRA

When should you claim Social Security?

70%

100%

124%

When must you start withdrawing from retirement accounts?

Who actually receives your assets — and what will the tax be?

Your will may not determine who receives every asset

Home

Sam

IRA

Former spouse

Brokerage account

Partner

What do estate-planning documents do?

Financial power of attorney

Healthcare directive

Will

Beneficiary designations

Trust

How should you give to charity if your investments have grown?

Sell the shares, then give the cash

Give the shares directly

Should you give investments to family now, or leave them in your estate?

Given during the parent’s life

Inherited at the parent’s death

Seven questions to ask before you hire an advisor

Professional advice can make the difference

Up to 3%

Up to 3%

$4.3M

$8.6M

$8.6M

$17.2M

$21.5M

$43.1M

What experience do you have with financial circumstances like mine?

How do you coordinate investment decisions with tax planning?

How would you assess concentration risk in my portfolio?

How would you help me plan retirement income and withdrawals?

How do you handle estate planning and giving — and when do you bring in an attorney?

How are you compensated, and what would I pay in total?

You’ve made financial decisions for years.
Some of the next ones may be new to you.