Primary Goals:

• Financially independent by 55, making work optional and spending more time with her family
• Outsource wealth responsibilities to an expert
• Devise a plan that optimizes her investments and benefits:
• Profit sharing assets
• Personal assets
• Deferred compensation plan
• Equity compensation (in the form of options, restricted stock units (RSU’s) and Performance-Based Restricted Stock Units (PSUs)) and employee stock purchase plan (ESPP)
• Disability insurance
• Life insurance
• Health insurance
• Directors and officer insurance

• Property insurance
• Evaluate her stock concentration and create and implement an investment plan that removes the risks.
• In case of an untimely death ensure her children can continue on with their lifestyle and education
• Reduce taxes where possible
• Provide guidance on any transition to another employer
• Educate and keep her compliant on International assets

Results Executed:

Wealth Enhancement and Tax Planning

• Removed Nike stock concentration risk and created one diversified portfolio across all accounts (reducing taxes) that attempted to maximize expected return and considered Jen’s specific risks.
• Evaluated Jen’s family cash flow and reduced income, taking full advantage of her benefit programs to reduce taxes.  Additionally, minimized taxes on equity transactions and harvested losses when possible.
• Utilized a Health Savings Account to reduce current and future taxes.
• Developed a Roth conversion planning strategy to reduce life time taxes.
• Adjusted foreign assets to avoid paying passive foreign income tax (PFIC).

Asset Protection and Estate Planning

• Evaluated insurable risks both inside the benefits at Nike and personally and, collaborated with Jen and other experts on the best policies and mitigation for her.
• Evaluated uninsurable risks and collaborated with Jane and other experts on how to mitigate those risk in the form of legal structures and best practices.
• Evaluated the protection and safety of assets, collaborated on costs and other approaches to protect the exposed assets.
• Evaluated estate wishes, including the care for Jen’s daughter, and taxes, collaboratively developed a plan prior to bringing in an estate attorney with the appropriate experience to provide the expertise and execute the plan.
• Created two Spousal Lifetime Access Trusts (SLAT) with the assistance of an estate attorney to benefit each of the spouses and ensure the livelihood of Jen’s daughter.  The trust also protects Jen’s assets from law suits and gives the spouses access to assets.   Additionally the trusts are to be in low tax and trust friendly states such as Nevada and Alaska and allow Jen to take advantage of the higher estate deduction before it is potentially lowered in 2026.
• Developed a list of assets to be placed in each country and ensure they complied with the estate plan and ensured any nonUS beneficiaries avoided unnecessary taxes.

Transition Planning

• Created a compensation and benefits score card to compare to outside offers.
• Reviewed non-compete clause and separation policies of Nike to evaluate risks on new employment.
• Reviewed negotiating approaches to consider when negotiating for a new position.
• Reviewed planning and implications of the Heart Act (exit tax )and planning necessary based on where she decides to make her domicile.

Disclosure

Note: The above case study is hypothetical and does not involve an actual Pacific Capital Works client.  No portion of the content should be construed by a client or prospective client as a guarantee that he/she will experience the same or certain level of results or satisfaction if Pacific Capital Works is engaged to provide investment advisory services.