Client Case Studies

Corporate Executives - Stephen, the Executive Vice President

Stephen, an Executive at a large pharmaceutical company, was referred to Rockwood by a long-standing client. Stephen recognized that his complex financial situation required advanced planning beyond the capabilities of his current broker, who was mainly concerned with discussing the merits of buying Coke stock versus Pepsi stock, and he was looking for an advisor who could assist with the various facets of his financial life, including his investment portfolio.

Critically, a sizable percentage of Stephen’s net worth was tied to his employer as he accumulated large positions in his company's Non-Qualified Stock Options, Restricted Stock Units, Employee Stock Purchase Plans, and Non-Qualified Deferred Compensation plans. He even maintained shares of company stock inside his 401(k), which further contributed to unnecessarily high levels of single-company-risk!

 

After reviewing his goals, we laid out a structured and coherent liquidation strategy for the various employer plans to mitigate the concentrated exposure to his employer's stock price. To reduce taxes, we helped Stephen with the decision to elect to defer some of his salary and bonus into the company’s Non-Qualified Deferred Compensation plan, walking him through a multi-decade tax projection to illustrate the impact of this decision.

 

Moreover, after reviewing the entirety of his financial picture, Rockwood uncovered that Stephen was woefully underinsured from a Life and Disability Insurance perspective and assisted him with placing a low-cost Term Life Insurance policy and supplemental Disability Income Insurance policy to ensure that his wife and three children were well supported if he were to pass away or become disabled.

 

The confidence that he was able to derive in his long-term financial trajectory, through the partnership with Rockwood, lead him to spend more time on what was most important to him, spending time with his family at their home on Long Beach Island.

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