Tim and Kelly are married with three kids. Kelly is a successful sales representative for a private company. She has several private stock benefits at her company, including an employee stock ownership plan (ESOP). Kelly has been receiving shares of stock in her company through her ESOP over time. She wonders what this means for their financial plan as they think about retirement. Her ESOP holdings are a significant part of her net worth and sometimes she worries if she has too much invested in one company.

Kelly also receives stock appreciation rights each year and phantom stock units on occasion. Finally, she receives restricted stock awards that are tied to certain performance goals. She is concerned whether she should be more proactive with all the different stock benefits.

Tim is an executive for a publicly traded company. He has various stock options that he earns each year at his company. Tim thinks some of his stock is eligible for an 83(b) election but he’s not quite sure he understands what the election means. In addition, Tim participates in an employee stock purchase plan (ESPP) where he buys shares in the company at a discount each year. The company also provides two programs to certain long-time employees and Tim will eventually be eligible: a company pension and a supplemental executive retirement plan (SERP). Finally, Tim receives bonuses paid in stock on occasion for meeting certain performance measures.

Tim and Kelly have heard there are tax considerations with the various stock programs they participate in. They worry their current investment advisor does not provide enough proactive tax planning on their corporate benefits and want a second opinion on their financial planning.

How Moneta Can Help

The team sat down with Tim and Kelly to understand their stock compensation programs and the various tax implications of each of them. After discussing their financial goals and aspirations, the team showed Tim and Kelly how their company stock in their respective organizations played an integral part in reaching their goals. The Duff Team outlined a plan that helped Tim and Kelly delegate the management of their stock compensation programs to their financial planning team and allowed the couple to focus on their jobs and spend more quality time with each other and their kids.

Examples contained herein are for illustrative purposes only based on generic assumptions; individual experiences with the Team, and results, will vary. These materials do not take into consideration your personal circumstances, financial or otherwise. This is not an offer to sell or buy securities, nor does it represent any specific recommendation. You should consult with an appropriately credentialed professional before making any financial, investment, tax or legal decision. Past performance is not indicative of future returns. All investments are subject to a risk of loss.


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