Company stock can be a powerful wealth-building tool, but it can also create unexpected risks. Mark sits down with Sarah Buchardt to break down the most common forms of equity compensation and the key decisions employees face. Along the way, they explore diversification, taxes, and how to determine whether company stock still belongs in an investor’s portfolio.
After you listen:
· Visit Schwab’s Equity Award Center ( for resources on the different forms of equity compensation, including sections like “Build Your Understanding of Equity ( ” and “Discover What Equity Can Do for You ( .”
Financial Decoder ( is an original podcast from Charles Schwab.
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Important Disclosures
This material is intended for general informational and educational purposes only. This should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned are not suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decisions.
For illustrative purposes only. Individual situations will vary and are no guarantee of future performance or success. Not intended to be reflective of results you can expect to achieve and are not intended to be, nor should they be construed as, a recommendation to buy, sell, or continue to hold any investment.
All expressions of opinion are subject to change without notice in reaction to shifting market, economic or political conditions.
Investing involves risk, including loss of principal.
Diversification and asset allocation strategies do not ensure a profit and do not protect against losses in declining markets.
Vesting means ownership of your account or your entitlement to benefits. You are always 100% vested in any contributions that you make to your retirement plan, even if you leave your employer. However, depending on what type of retirement plan you have and the choices your employer has made about the benefits under the plan, vesting of employer contributions may be immediate or may take up to seven years. Your plan’s disclosure documents will contain the specific vesting schedule.
Equity Compensation is a very complicated topic, and planning raises complex tax, legal, estate planning, and investment management issues. An ECC is intended to help you understand the value of your company stock and options, provide wealth management education, and when appropriate will include investment advice relating to your equity compensation. All stock prices and tax calculations are hypothetical and are used for demonstration purposes only.
This information is not a specific recommendation, individualized tax, legal, or investment advice. Tax laws are subject to change, either prospectively or retroactively. Where specific advice is necessary or appropriate, individuals should contact their own professional tax and investment advisors or other professionals (CPA, Financial Planner, Investment Manager, Estate Attorney) to help answer questions about specific situations or needs prior to taking any action based upon this information.
All corporate names and market data shown are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security.
Past performance is no guarantee of future results.
The Schwab Center for Financial Research is a division of Charles Schwab & Co., Inc.
The policy analysis provided by Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party.
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