Financial Planning

Is there any tax saving strategies or optimization opportunities that I’ve overlooked? What can I do to mitigate the downside risk and in the meanwhile not to trigger tax on my substantially concentrated equity compensation positions? What kind of retirement plan is most suitable and cost-effective for my business?

These are all valid questions, and fortunately, we have the answers for you:

Financial Planning - FAQ

Q: What’s your typical financial planning client profile?

A: While we are happy to help anyone who has a financial planning need, the clients who found our planning sessions the most helpful are those with complex financial situation and cannot find satisfying answer elsewhere. Our typical clientele is with an annual family income of $0.5 million to $2 million and a total asset of $5 million to $30 million. Many of them are either big firm employees with large equity compensation and complex investments, or small business owners and professional practitioners. Also, everyone in our office is bilingual in English and Chinese so it is not a surprise that most of our clients are within Asian heritage.

Q: How would I know if the financial planning will help me?

A: If any of the following situations apply to you, you have come to the right place:

1. Individuals who have paid high taxes and are seeking ways to save on taxes 
2. People with complex sources of income (e.g.e.g., 1099, K1 forms, stock compensation) 
3. Those who desire a comprehensive professional review and plan for their family's finances, including advanced tax planning, cash flow management, retirement account analysis, investment asset allocation, and family risk control 

While every person’s financial situation is unique, our clients found us the most helpful in complex planning cases, which usually involves equity compensation (RSU, ISO, NQSO), concentrated positions, trust, investment, and business.

Q: I already have a CPA who helps me file tax, is your financial planning going to add additional value to me?

A: Most of our clients have their own CPAs and we would love to work with your CPA. Identifying tax saving opportunities is part of our service but our financial planning goes beyond that. For example, we will review your equity compensation package and assist you to make timely, informed, and prudent decisions on exercising/selling/diversifying your options/stocks in a tax-efficient manner.

Q: What are the typical questions/topics from a client who has large equity comp?

A: Stock cost basis adjustment; ISO AMT tax credit; Early exercise consideration and 83(b) election; Strategies to diversify concentrated position without triggering tax payment and hedge downside risk.

Q: What are the typical questions/topics from a client who is a business owner?

A: Tax saving strategies for business; asset protection solutions; estate planning and trust setup.

Financial Planning - For Small Business Owner

Being an entrepreneur is hard. It needs patience, consistency, and momentum every day just like running a marathon. Here are a few areas that we believe we can help and make your life easier.

Business and Personal Tax Optimization strategies

• Retirement plan, e.g., 401(k), cash balance plan, defined benefit plan
• Group health insurance plan
• 199A Qualified business income deduction
• Hiring family members
• Employee Retention Credit (ERC)
• Estimated tax payment
• R&D credit

Business Protection and Succession Plan

• Owner’s long term disability insurance
• General Business Insurance/Malpractice Insurance/Cyber Security Insurance/Employment Practices
• Liability Insurance
• Buy-Sell Agreement
• Qualified small business stock (QSBS) 
• Employee Stock Ownership Plan (ESOP)
• Business Valuation

Family & Asset Protection

• Simple estate planning package, which includes will, durable power of attorney, medical power of attorney,HIPPA release form, Living trust
• Beneficiary designation
• Irrevocable Trust
• Life Insurance

Financial Planning - For Big Firm Employee

As an employee of a large company, you may be entitled to various forms of compensation, such as restricted stock units (RSUs), non-qualified stock options (NSOs), and incentive stock options (ISOs). You may also have access to additional benefits like after-tax 401(k) plans, employee stock purchase plans (ESPPs), pensions, and deferred compensation plans. This package is designed for individuals who work in large companies and would like to make informed decisions about exercising, selling, or diversifying their equity compensation positions and get the most out of the employee benefit program.

Personal Tax Optimization strategies

• Detailed stock-compensation-related tax forms review, including W2, Paystub, 1099- B, For 8949, Form 3921, Form 6251, and Form 8801
• Stock cost basis adjustment 
• Early exercise consideration and 83(b) election assistance 
• Stock compensation tax projections, including estimated tax, AMT, AMT credit, and wash sales 
  Asset allocation and portfolio customization based on concentration positions 

Employee benefit program review, analysis and recommendation

• 401k plan, including Pre-tax/Roth/After tax contribution, in service conversion (Mega Backdoor), investment options. 
• Other retirement plans, including pension, deferred compensation plan, defined benefit plan, cash balance plan. 
• Life insurance, long term care insurance, long term disability insurance 

Hedging and diversification strategies

• Exchange Funds 
• Direct indexing 
• Hedging and monetization 

Financial Planning – Process

First year

Step 1: Discovery Call

• This is a quick 15-minute call to answer any questions you have and give you an intro to the firm.
• This is a due diligence meeting for you. Please ask us any questions you have, e.g., our credentials, services, experience.
• We will also need to learn a bit information about you. E.g., Current finances, objective, and goals.

Step 2: Get Organized

• Sign the contract, collect fee, and define scope of engagement and timeline.
• We will gather all your documents in our secured portal.
• When everything is ready, we will reach out to book final presentation time with you.

Step 3: Final Presentation

• We will deliver and present the comprehensive financial plan to you.
• The presentation time including Q&As. If you need additional consulting time, our fee is $500 per hour.
• Presentation time
  • Essential: 1 hours
  • Pro: 1.5 hours
  • Business: 1.5 hours
  • Elite: 2 hours

Step 4: Implementation Meeting

• One additional meeting to discuss implementation details if you choose to implement with us (additional fee may apply).

Year 2 and beyond

If you would like to schedule additional consulting session with us in year 2 and beyond, please contact us directly. Our fee is $500 per hour.

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_{* LPL Financial does not offer individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.}

_{* LPL Financial Representatives offer access to Trust Services through the Private Trust Company N.A., an affiliate of LPL Financial.}