One of my favorite clients, Jocelyn, is 43 and works for a large publicly traded company selling commercial insurance in Columbia, SC.
She’s divorced with a 12-year-old son, Aiden.
Her salary is $175,000 per year and she receives around $75,000 in Restricted Stock Units (“RSU’s”).
“Nic, I’m paying way too much in taxes, I’m busy, and I don’t really understand this stuff. Can you please help?”
(Note: On our Zoom call, she shows me a stack of statements)
I asked her what her normal daily routine looked like: Drop Aiden off at school, workout, go to work, school pick-up, snack, cart Aiden to soccer practice, quick dinner, homework, catch up on work emails, tidying up, and finally “enjoying about 12 minutes of free time before falling asleep.”
🔁 [On Repeat]
Sound familiar?
If you’re in your 40’s with kids, you can likely relate to this. And this is why we love working virtually with our clients in the Carolina’s and across the country, because we recognize how busy you are and that it can be incredibly more efficient to jump on a Zoom call, rather than always trying to commute back-forth to our office.
As we continued to dig in with Jocelyn, we quickly realized that she fell into the marginal 32% tax bracket, and her RSU’s default tax withdrawal setting was 22%. Every year as her RSU’s vested, she wasn’t withholding enough, leaving her with an unexpected tax bill. To her surprise, it wasn’t that she was paying too much in taxes, it was that she wasn’t paying enough throughout the year.
From there, we continued through our process, getting a better understanding of Jocelyn’s goals for herself and Aiden, so we could build her plan.
After discussing her goals, the building blocks for the plan slowly came into place…
- Updating life and disability insurance through open enrollment
- Updating her 401(k) investment allocations and removing her ex-husband as beneficiary, replacing him with the name of her family trust
- Consolidating old retirement accounts
- Establishing a high-yield savings account for emergency funds
- Applying for a Home Equity Line of Credit through her local bank
- Establishing an individual investment account
We don’t do this with our clients by accident or to check the boxes, we do it because for every goal that Jocelyn shared, we needed to determine how much she’d need to achieve it. So we put a plan in place to save and invest monthly to fund her dreams and goals.
After only a couple of meetings, you could see the cloud of confusion & overwhelm was lifted, Jocelyn now enjoyed financial clarity rooted in her personal financial plan.
It’s important to share: Jocelyn was recommended to us by one of our super-connector clients, Danielle—Danielle, we’re always happy to help you, your family, and friends—thank you for trusting us!
If you or someone you’re close to is a high-achieving professional that could use help aligning their finances and establishing a financial plan, please reach out to us, we’re accepting new clients and eager to help.
Cheers, Nic
This is a hypothetical situation based on real life examples. Names and circumstances have been changed. The opinions voiced in this material are for general information only and are not intended to provide specific individualized investment, tax or legal advice for any individual. We suggest that you discuss your specific situation with a qualified, legal advisor and financial advisor.
