Case Study

New Wealth Leaves John and Susan Looking for Answers

While exciting, a sudden acquisition of new wealth is complex and for John and Susan, it presented a large set of questions about management. John took stock options from his employer early in his career and they blossomed into a large payout that elevated the couple from employed and financially comfortable to very wealthy. They had many questions about how to manage the wealth alongside their new lifestyle.

The Challenges

Managing a Sudden Influx of Wealth

John’s compensation package evolved as the company grew and the employees were offered the opportunity to receive company stock shares in lieu of cash bonuses, which he accepted.

The company was now offering to buy back shares at a price of $40mm (after taxes) to John and Susan. They accepted the offer, receiving life-changing money.

This decision presented new opportunities for them and their family, but it was not without challenges. Among the questions and concerns John and Susan had:

How to manage this newfound wealth and build a team to support their needs;
How to protect this new wealth, and invest for sustainable growth;
Consider tax strategies and efficiencies to minimize liability; and
Maintaining their core values and family relationships

Ultimately, John and Susan wanted to understand how they could transition from a salaried lifestyle to one funded by a portfolio. They felt unsure on how to move forward and wanted expert guidance to make educated decisions.

The Solution

Build a Family Centric Wealth Plan Designed to Last

John and Susan engaged the Private Wealth team to review their situation, provide education to them and their children, and deliver recommendations based on their personal goals and priorities. Their advisory team did a deep dive to understand what John and Susan really wanted to accomplish and to design pathways to help them make progress toward the future they envisioned.

For John and Susan, the process was broken into steps to manage every aspect of their situation.

Goal Setting
Guided discussions revealed the most important desires for John and Susan which included a second home, securing a financial future for their children, and providing a family communication plan.
Risk Management
New wealth can also mean new risks. Protecting and preserving assets was a focus and several detailed options were presented in a fully fleshed out risk management plan.
Estate Planning
A holistic estate plan was built to align with John and Susan’s values. The PW team helped create a vision for future legacy, implement core estate planning documents, identify legal and tax counsel and build strategies for wealth transfer and philanthropic giving.*
Family Engagement
The team established regular meetings with John and Susan, and their children, to provide support and structure. Among the topics: prenuptial agreements, funding philanthropic priorities, and fostering the entrepreneurial spirit of their children.

The Results

Stability and Wealth

John and Susan have a team that understands them, proactively seeks opportunities to help them make continued progress toward their goals, and helps them guard against risks. They have confidence in their decisions and that they have created a plan that is sustainable for their lives and generations to come.

Is Your Wealth In Good Hands?

Get in touch with the experts at Private Wealth to start planning for a better future. Protect your legacy and create a plan today.**

* Private Wealth does not create estate plans but works to implement estate plans created by a client’s outside third-party provider. Private Wealth does not provide legal or tax advice, but helps clients identify outside third-party providers suited to a client’s needs. Private Wealth does not receive compensation for referrals to third-party service providers and such services are hired at the client’s expense separate from fees paid to Private Wealth. Providers of the same services may be available to clients at lesser cost.

** Investing involves risk and use of Private Wealth’s services does not guarantee earning a profit or avoiding a loss.