Financial Life Planning & Your Company Stock Options

For most people, reviewing finances and life plans that relate to finances, can be pretty stressful. Planning gets ignored or pushed down the priority list, until something unexpected comes up, and forces you to pay attention. And even when you have positive money circumstances, e.g. an unexpected windfall, or new stock options, it can still be overwhelming – another thing to “pay attention to later.”

While taking the time to create a financial life plan may seem stressful, what you’ll probably find is that it can have the opposite effect. As with most things, giving your situation some attention and care can demystify, create awareness, and help bridge the gap between identifying immediate priorities and planning for the long term.

In comes Financial Life Planning. A values-based, life-centered approach to financial planning. It engages individuals and empowers them to maximize their resources and live meaningful and purposeful lives. It’s laying out your immediate priorities and values and aligning your resources to them now. The financial life planning process helps establish meaningful financial and life goals, and create an effective and inspiring decision-making framework. Financial life planning is well suited for someone that has variable income, stock options, commissions, bonuses, etc.

If you do get a windfall or start to make a lot of money, you will likely have an immediate goal you would like to achieve. Examples of this could be paying off debt, starting a family, taking a sabbatical, traveling the world, or purchasing your first home.

For context, this approach is different from the traditional process of financial planning. The traditional process is tailored for someone with a standard fixed salary/income. In the traditional method a financial advisor may suggest you max out retirement accounts, pay off your debt, and tackle what they believe are your financial blindspots. Financial life planning attacks YOUR priorities and goals first and then layers traditional financial planning on top of it. I use the R.E.T.I.R.E. acronym as my base for assessing financial blindspots after we’ve established your financial life plan.

When it comes to stock options or equity compensation, it’s crucial to understand how you want to live your ideal life. How do you visualize your future? What brings you joy? What aspirations do you have? What will provide you the most satisfaction? What life transitions do you need to plan for? Depending on your answers to these questions will help determine the best strategy for you when it comes to your company stock plan. 


Ready to create your plan? 

Book a call with me today. 


WealthBuilders, LLC is a virtual fee only fiduciary advisory firm specializing in working with progressive professionals with stock options.

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