Financial Planning › Strategies

Podcast included! If you've been granted stock options, congratulations. But now what? Maximizing the value of stock options is one of the most complex financial-planning challenges you may face. The 10 guidelines in this article will help you get the most out of your option grants: setting goals, stock option valuation, exercise timing, job-loss considerations, understanding the taxation, and much more. An interactive companion quiz lets you test yourself on what you've learned.

Podcast included! Employee stock purchase plans (ESPPs) are a super deal. However, the related taxation and financial planning can be deceptively complex. This article presents the essential points that you should understand before you participate in your company's ESPP.

If you own restricted stock units (RSUs), you need to plan for what you will do when the shares vest. Whether you hold or sell, being prepared will help you be proactive instead of reactive and make the most of the opportunity RSU grants provide.

Podcast included! Planning for equity compensation begins with identifying the role stock grants will play in your life, whether for retirement, college funding, or other goals. This article offers points to consider for three different types of investors.

Stock prices have been on a wild ride in 2020. Market volatility can rattle anyone's financial plan for stock compensation and company shares. What should you do with shares acquired from equity awards now? Sell them immediately? Hold them in the hope that the stock price will recover? Should you change the strategy you've been following? This article provides a financial planner's insights on how to consider these questions.

Podcast included! While in 2018 the Tax Cuts & Jobs Act superseded many prior tax provisions, other tax provisions introduced in previous legislation (such as the Affordable Care Act, i.e. Obamacare) remain in place. Income thresholds for the tax brackets trigger higher tax rates, so it is wise to monitor the tax impact of income-generating events stemming from stock compensation. This article suggests strategies for minimizing their impact.

Emotions can have a powerful impact on financial decisionmaking. The study of behavioral finance, i.e. how people make decisions about investments and other financial matters, can help you to develop a sensible approach to stock compensation and holdings of company stock.

Podcast included! Stock options can be very lucrative if handled properly, but there are situations in which people can easily make mistakes. In this article I discuss the most common mistakes I see.

Podcast included! The Tax Cuts & Jobs Act has provisions that affect stock compensation, whether in financial planning or in stock plan administration. This article details six with an impact on the taxation of stock compensation or holdings of company shares.

Employee stock purchase plans (ESPPs) are changing in many ways, largely in response to accounting rules. For Part 2, myStockOptions.com asked financial and wealth advisors what they are recommending to clients about ESPP participation.

Many companies have turned away from stock options and begun to make outright stock grants that must vest before the shares can be issued. For employees, these grants have added a new layer of complexity to their equity compensation. This article presents six questions I get all the time from clients who have received restricted stock, restricted stock units, or performance shares.

Podcast included! Understand financial planning for restricted stock and RSUs. Part 1 discusses the growing popularity of these grants, their special features, and the related tax planning.

Could the Roth IRA be your greatest opportunity for accumulating tax-free growth? Well, as with most strategic-planning issues, it all depends. Part 1 of this two-part article series looks at the rules and factors to consider in a Roth IRA conversion.

Whether you are a novice or advanced investor, it can be hard to decide what to do with your company's stock grants. Should you exercise options now or wait? Should you hold company stock at vesting or sell it and reinvest? Behavioral economics and investor psychology offer insights that can help you develop a personally acceptable approach.

Podcast included! Rather than a guarantee, today's benefit plans offer only an opportunity to attain financial security. The planning decisions you make with equity awards are crucial.

Podcast included! Stock options are a major element of your long-term incentive compensation, offering tremendous potential to accumulate personal wealth. Given your stock options' complexity, it’s essential to develop a strategy to realize their full potential.

My clients want to exercise options shortly after they vest for a significant purchase, like a fancy boat or a sports car. The most expensive boat or car I can imagine is the one bought with your just-vested options. Tips I tell clients include not exercising too soon or waiting too long.

I see too many smart people who have substantial gains in their stock options do dumb things, as I explained in my first article. Here are more of the rules I try to teach my clients, which can act as a guide for you, too.

Before you participate in your company's employee stock purchase plan (ESPP), understand the following essential points for financial planning with ESPPs...

Retirement savings can be significantly boosted by equity compensation. When factoring stock options, restricted stock/RSUs, or ESPPs into your retirement planning, you should know the answers to the following questions...

This is a difficult question that only you can really answer, as your exercise timing depends on a number of personal factors unique to you...

Most option plans do not prescribe the order of option exercises, which is usually up to you...

This is wishful thinking, because these are two separate transactions. It does not make sense to...

There is no universal NQSO planning for everybody. With that said, we present some general advice from experts...

When the stock market rebounds after a fall, one of the most common mistakes among optionholders is exercising too early to grab quick profits...

To receive a dividend you must own a stock on the record date, so you want to be aware of the ex-dividend date. Also consider...

As long as the student is considered a dependent of the parent for financial-aid purposes, the parent does have to report stock options on line...