Financial Advisor News

Piedmont, CA

Financial Advisor News

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Piedmont, CA

by: ALISON VAN DYKE

FIRST AND MAIN FINANCIAL

(510) 601-1935

Oakland, CA | Best Financial Advisor Bay Area; Planning with Restricted Stock

Like many of our clients, Mark works at a Bay Area start up company that compensates employees with stock options, restricted stock units (“RSUs”) and the opportunity to participate in the Employee Stock Purchase Plan (“ESPP”).  He and is wife Lee, who are in their 40s, came to First & Main Financial looking to verify they were on the right path to meeting their financial needs throughout retirement.  They asked us to help them figure out how much they needed to contribute to retirement funds, how to best fund a new house for their young family, and how to benefit most from their stock options, RSUs and the ESPP.

As we do with all of our clients, we went through a detailed data gathering process.  We then analyzed the information and produced a base case scenario, using their current financial situation.  We also created multiple “What If” scenarios, such as different retirement ages, various home purchases at different price points, and different approaches to investing their current assets.  These “What if” scenarios help assess the overall impact of any changes to their financial plan.

Within each of these scenarios, we projected a “probability of success” of reaching a life expectancy age with enough assets to live on.  Most importantly, we showed them the impact of exercising their stock options and RSUs over time, especially in regards to tax liabilities and capital gains treatment.  We explained the risks of selling or holding onto their shares.  We also suggested that they need to consider their overall goals when thinking about the potential sale of stock, not necessarily how to pay the least amount of tax.  Finally, we helped them understand the ESPP program and how to at least benefit from the discount provided to employees such that they could lock in a guaranteed profit.

First & Main Financial provides clients with quality and individual attention as well as complimentary guidance on existing 401(K) money.  We also offer our clients a tiered fee schedule for asset management which is considered a good deal compared to the industry averages and starting rates usually charged by other firms.

If you are looking for some financial guidance, whether it’s for a one time financial plan or continuing advice on your investments, we invite you to meet with the First & Main Financial advisors for a free consultation.  We work with a variety of clients, including clients like Mark and Lee, who wanted to understand stock options, RSUs and the ESPP.  We would be more than happy to sit down with you, assess your current financial situation, and review with you our services to help you navigate your own financial future.

Oakland, CA | Asset Management Expert for RSUs in the East Bay

Planning for the unknown can be challenging, but projecting lifetime cash flows through thorough analysis and well-developed assumptions can go a long way in clearing up an otherwise murky situation.

Recently, Jim and Sandy came to First and Main Financial seeking financial assistance. Their focus was to gain a better understanding and become more comfortable with what their future would hold once recently granted pre-IPO shares were vested.

Like many families, they were juggling two careers while raising two children, both in grade school.  Jim had recently started a new job with Uber (pre-IPO) and was awarded restricted share units (RSUs) upon being hired.  Sandy was busy with her career as well, owning and running her own salon.  They wanted to understand their current and future cash flow situation more clearly and re-evaluate their college savings and retirement goals; making certain they were on the right path for success.

We reviewed their current and projected living expenses as well as future income.  With the new job at Uber came an initial grant of RSUs as well as on-going grants annually.  Both types of grants would vest based on a pre-determined schedule once certain requirements were met.  The requirements were time-based (beginning one year after hire date) and performance-based (IPO), and both would need to occur for the initial shares to vest.  There would also be a six-month lockup period after the IPO, where no RSU’s could be sold.

We spent a significant amount of time combing through the plan summary documentation to gain an accurate representation of what was granted, when the shares would vest and over what period of time the vestings would occur.  We determined when the taxes would be withheld and when the shares could be sold and provided guidance on whether to sell or hold on to company shares.  We finally discussed and agreed on an estimated IPO date and price to use in our initial model.

Once the comprehensive financial plan was ready, we sat down with Jim and Sandy and walked them through the model.  We reviewed all the areas of the financial planning process and spent additional time on what-if scenarios associated with the RSU vestings.  The exercise was very helpful in setting expectations, but we knew we would revisit the plan once the IPO was scheduled.

The Uber IPO happened in May of this year and the post-IPO lockup period has recently ended.  We’d gotten back together with them prior to the lockup period to review the updated plan, which now contained the known IPO details and up-to-date vesting information.  The final result was a robust, easy to maintain plan that would specifically keep track of all RSU’s granted and sold by Uber and also support additional selling by our clients.

If you are looking for financial guidance, whether it be for a one-time financial plan or continuing advice on your investments, we invite you meet with a First and Main financial advisor for a free consultation.  We would be more than happy to sit down with you, assess your current financial situation and review with you our services to help you navigate your own financial future.

Oakland CA | East Bay, Piedmont; Financial Planning and Investing for Young Fami…

Preparing for Every Possibility:

Getting started as a new family can be overwhelming – your life completely changes once you have a little person depending on you.  Our clients, Jeff and Diane, who are in their 40s, came to First & Main Financial looking for help to insure they were on the right path to meeting their financial needs; especially as they started a new family.  They asked us to help figure out how much they needed to contribute to retirement funds and college savings, how to best fund a new home for their family, and what to do for risk management.

As we do with all of our clients, we went through a detailed data gathering process.  Once the information was received, we upload the data to our secure financial planning software and analyzed the information to produced multiple scenarios; such as different retirement ages, various prices for a new home, and different approaches to investing their assets.  These what if scenarios help assess the overall impact of any changes to their financial plan.

Within each of these scenarios, we projected a probability of success for reaching a life expectancy age with enough assets on which to live.  Most importantly, we showed them the impact of purchasing a new home in the Bay Area and how certain investments vehicles, such as a 529, could help provide college funding for their children.

In addition to reviewing their finances, we reviewed their insurance (Life, Disability, Auto, Renters, Medical, etc.) to assess if they maintained enough coverage.  We helped them to get a quote for Term Life Insurance policies to give them greater liability coverage in the event they need to cover costs for their family.   We also encouraged them to review their estate planning documents, especially since they needed to make decisions about guardianship for their children.

First and Main Financial offered to review their 401(k) options as well as other investment options to assess options that could provide possible greater return.  We also offer our clients a tiered fee schedule for asset management which is considered a good deal compared to the industry averages and starting rates usually charged by other firms.

If you are looking for some financial guidance, whether it’s for a one-time financial plan or continuing advice on your investments, we invite you to meet with a First and Main financial advisor for a free consultation.  We work with a variety of clients, including clients like Jeff and Diane, who are trying to ensure their family is financially secure.  We would be more than happy to sit down with you, assess your current financial situation, and review with you our services to help you navigate your own financial future.

Piedmont, CA; East Bay: Customizing a Financial Plan for Specific Income Needs

Managing a sizable taxable account requires special expertise:

This became clear when a recently divorced client, age 48, came to our firm seeking assistance with developing a plan to meet his annual living expenses (which included a new home purchase in the following 6-12 months) as well as his future retirement goals.  As the divorce was finalized a couple months before our meeting, his financial situation was significantly different than it had been in the past.  This new undefined future was a cause for concern.  Going forward, additional income would need to be generated from a taxable account that was partially funded as part of the divorce agreement.  In addition to future savings goals, this account would also be used to help cover annual living expenses and ongoing child support for his two daughters (ages 11 and 12).

After meeting and gathering financial details over the course of a couple of weeks, we were able to accurately project future living expenses.  Drilling down to line item details and arriving at an annual living expense amount was critical in order to determine how much income he would need from his taxable funds going forward.  T

here was concern that accessing this money now, would cause a shortfall down the road in retirement.  We reviewed all sources of income which included a future pension amount as well as social security benefits.  After a thorough review of the financial information, the details were entered into our financial planning software for further analysis.  We reviewed his overall situation by projecting annual cash flows throughout his lifetime as well as creating scenarios indicating the type of home to buy, how much to save for retirement and education, different life expectancies, and the effects of different growth rates on investments.

We eventually settled on a comfortable amount to put towards a new home and provided guidance to get the best possible financing.  We described how to approach the taxable portfolio from an investment management perspective and provided guidance on how the taxable funds could be allocated to generate income while keeping taxes in check; and also continue to grow at a reasonable rate.  A thorough review of his existing positions was performed and certain positions were sold and others kept unchanged (primarily based on how this would impact his tax situation).  A gradual approach to creating additional diversification was recommended, so that within a couple years his portfolio would be at the targeted allocation and diversification levels.  Incorporating higher quality, income-generating, tax-efficient investments within the account was a priority.  A significant amount of work was done to create a customized portfolio to meet our client’s needs for income and growth.  The recommended changes allowed for approximately $35k of additional income to be used annually to help with expenses, while still allowing the portfolio to grow over time.  A primary concern for our client was the complexity associated with this activity and also having the time to devote to it and continue managing it going forward.

Today he is in a path to success.  There is now confidence that he can meet his financial goals with additional flexibility built into his plan to account for whatever life brings his way.  We are looking forward to continuing our relationship and assisting with the home purchase and other major financial decisions as they happen.  We will meet periodically to make sure we stay on track.

If you are looking for financial guidance, whether it be for a one-time financial plan or continuing advice on your investments, we invite you meet with the First and Main Financial for a free consultation.  We would be more than happy to sit down with you, assess your current financial situation and review with you our services to help you navigate your own financial future.

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.

235 Wildwood Avenue,
Piedmont, CA 94610, USA

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Piedmont, CA 94610, USA

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.