Pre-Retirees
Maximize Wealth. Minimize Taxes.
Achieve Your Goals.
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Polly was an executive in senior management at a publicly traded company. She had been at the company for quite some time and had amassed significant wealth in the form stock options. She could only exercise and sell the options during certain, limited open trading windows and many of them were expiring over the next several years. Not having a plan in place to exercise her options meant they could potentially expire leaving Polly with significantly less wealth. To further complicate her situation, she also had restricted stock units vesting every year, generating additional taxable income, and the ability to defer a portion of her salary and bonus into a non-qualified deferred compensation plan administered by the company.
In developing her wealth plan, we first suggested that she “cash out” her restricted stock units as they vested and use the proceeds to build a diversified portfolio. Next, we helped develop the strategic timing of distributions from her deferred compensation plan to provide a source of income in her lower income years; the period of time after she retires but before her Social Security benefits and required minimum distributions begin. Finally, we developed a multi-year stock option exercise strategy navigating the various exercise restrictions. With this approach we successfully helped her meet her goal of developing a plan that fit all these pieces together in a way that minimized her taxes and maximized her wealth over time.