Negotiating your executive compensation package is challenging. We're tapped into best practices and industry expectations. Allow us to help you get the most from this opportunity.
Optimizing executive compensation
At the C-suite level, managing your personal finances is no small task. And finding the right approach to optimizing your compensation package takes special care. At the Private Bank, we’ll show you best practices for reviewing employment agreements, evaluating stock options, navigating public perception and diversifying your portfolio. And deciding if, when and how to defer your compensation. We’ve worked with many successful executives to maximize their compensation and plan for their long-term financial future. We can do the same for you.
J.P. Morgan advisors take the time to get to know you, your company, your family and your objectives. From there, we offer guidance and advice on how to optimize your executive pay now and for years to come. And we do it all with consideration of public perception and reporting.
To defer or not to defer?
When it comes to optimizing your compensation, our advisors often suggest that you consider deferring all or a portion of your current compensation. Why? When you defer compensation, you benefit from compounding tax-free growth. That’s because you don’t have to pay income tax on the deferred funds, and you can earn a return on your investment over the deferment period.
The longer you are able to defer, the more you will benefit. However, there are many things to consider when thinking about deferring compensation. Our specialists are here to help you weigh the pros and cons, and to make a decision that works for your overall wealth plan.
If you’re thinking about deferring your compensation, your Private Bank team will work with you to consider the following factors:
- Your personal need for liquidity.
- The investment choices within, and outside, your deferred compensation plan.
- Whether your company matches any amounts deferred.
- Your company’s creditworthiness—if the company goes bankrupt, your deferred compensation becomes part of the bankruptcy proceedings.
- Your primary state of residence, and where you plan to live in the future.
- The ordinary income tax rates, both at the time of the election and when you anticipate receiving your deferred compensation.
- Amounts you have previously deferred.
If you decide to defer compensation, you must decide how and when you want to receive your distributions. This decision must be made thoughtfully, since the Internal Revenue Code limits the ability to make changes to deferral elections.
Diversifying a concentrated stock position
A concentrated stock position—owning a large amount of stock in the company you work for—comes with certain risks. Luckily, there are many ways to diversify your portfolio. Our advisors can help you find the diversification strategies that are appropriate for you. Learn more about managing your concentrated stock position.
Navigating public perception
Our advisors understand the challenges that accompany a public company career. Your personal financial choices—like choosing to sell company stock or separate from your company—may be scrutinized by the public. We’re sensitive to what this may mean for you and your company.
Get more C-suite and startup compensation information
The Private Bank offers teach-ins for C-level teams and startups to discuss best practices for managing executive compensation. Interested? Connect with one of our advisors to learn more.
Optimizing executive compensation
Managing a concentrated stock position
Our advisors have deep experience working with corporate executives to diversify or liquidate their concentrated positions. And like everything we do, we do it with their overall wealth plans in mind.
Planning a C-suite executive transition
Leaving a C-suite position at a public company can have far-reaching impact. Let's put a plan in place that works for you, your family and your company.
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