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Stock compensation comes with a unique set of tax implications that can feel overwhelming. Especially at tax time when you are trying to gather all the reporting forms needed. With the right guidance though, it can easily become manageable. Here I will walk you through the process step by step. Including, helping you gather necessary tax reporting forms, understand each forms purpose, and accurately report your stock-related income and transactions.

Step 1: Understand the Categories of Tax Forms

Stock compensation tax reporting involves three main types of forms: general reporting, stock compensation tax reporting, and tax return filing forms. Familiarize yourself below with these three categories to ensure clarity when preparing your tax paperwork.

1. General Reporting Forms

General reporting forms will cover wages, miscellaneous income, and proceeds from broker transactions. These forms are essential for capturing the broader financial picture of stock compensation and related income.

Form W-2
- This document reports wages and other compensation, including income from stock compensation such as RSUs, NSOs, and ESPPs.
Form 1099-MISC
- Used to report miscellaneous income, which may include certain types of stock compensation for non-employees.
Form 1099-NEC
- Reports non-employee compensation, including earnings from stock options for contractors or board directors.
Form 1099-B
- Details proceeds from broker transactions, such as sales of stock acquired through equity compensation.
Supplemental Information Form
- Additional form that offers detailed breakdowns of cost basis and adjustments for stock sales often supplementing a 1099-B form.

2. Stock Compensation Tax Reporting Forms

Stock compensation forms are specific to your stock plan activities and ensure proper reporting of key milestones in stock compensation. This includes the exercise or transfer of stock.

Form 3921
- Documents the exercise of ISOs, providing details on the exercise date, price, and fair market value.
Form 3922
- Reports the transfer of stock acquired under an ESPP, including purchase dates, prices, and fair market value.

3. Tax Return Filing Forms

Tax return forms report total income, capital gains and losses, as well as special calculations like Alternative Minimum Tax (AMT).

Form 1040
- The primary tax return form where you report all income, including stock-related earnings.
Schedule D (Form 1040)
- Summarizes capital gains and losses from stock sales.
Form 8949
- Provides detailed information about individual stock sales, including sales stemming from equity compensation.
Form 6251
- Used to calculate Alternative Minimum Tax (AMT), which could be triggered if you exercise ISOs.
Form 8997
- Tracks investments in Qualified Opportunity Funds, which might apply if you have certain stock-related gains.

Step 2: Gather the Necessary Forms

From Your Employer

Collect documents like Form W-2 that report stock compensation tied to your job.

From Your Broker

Obtain year-end statements and Form 1099-B for details on stock sales. Make sure to request the Supplemental Information Form as well to verify cost basis adjustments.

From Plan Administrators

For stock acquired through ISOs or ESPPs, request Forms 3921 and 3922.

Pro Tip: Check all documents for accuracy. Errors, such as incorrect cost basis or missing transaction details, are common and can cause discrepancies in your tax return.

Step 3: Step-by-Step Reporting

Follow these instructions to ensure accurate tax reporting for stock compensation:

1. Reporting Wages and Compensation (Form W-2)

Identify the portion of income attributable to stock compensation in Box 1 of your Form W-2. Employers often include income related to RSUs and exercised stock options here.

Pro Tip: RSU income is usually taxed when vested, and NSO income can be subject to withholdings at exercise. Verify these amounts align with your records before submission.

2. Reporting Stock Sales (Forms 1099-B, 3921, and 3922)

Use Form 1099-B to report stock sales. Check the cost basis listed since brokers often omit adjustments related to stock plans. Use information from the Supplemental Information Form to complete the corrected cost basis.
Leverage Forms 3921 and 3922 to review key dates and values for accurate sale reporting. For example, ESPP shares sold early may trigger disqualifying dispositions that affect how they’re taxed.

3. Completing Capital Gains and Losses (Schedule D and Form 8949)

Use Form 8949 to list each stock transaction, including its purchase and sale dates, proceeds, and adjusted cost basis. Transfer these totals to Schedule D to calculate your overall capital gains or losses.

Pro Tip: Short-term sales (held under one year) are often taxed at higher ordinary income rates, while long-term sales qualify for favorable long-term capital gains tax rates.

4. Checking for Alternative Minimum Tax (Form 6251)

If you exercised ISOs and held the stock, calculate Alternative Minimum Tax (AMT) on Form 6251. The difference between the exercise price and fair market value at the time of exercise is considered income for AMT purposes, even if the stock was not sold.

Pro Tip: Calculate Alternative Minimum Tax early to avoid surprises and ensure adequate tax planning.

Step 4: Tips for Avoiding Common Mistakes

Double-Check Cost Basis Details

Always check over cost basis details. Incorrect or omitted adjustments can lead to over-reporting or under-reporting capital gains.

Track Your Holding Periods

For favorable tax treatment, meet required holding periods for ISOs and ESPPs (one year from purchase and two years from grant for ESPP stock).

Don’t Neglect Alternative Minimum Tax Calculations

If you miss calculating your Alternative Minimum Tax (AMT) when exercising ISOs may result in underpaid taxes and possible penalties.

Step 5: Consult a Professional

Stock compensation tax reporting can be complex, especially with issues like AMT, disqualifying dispositions, or missing cost basis information. A knowledgeable professional can provide personalized guidance, ensure accuracy, and potentially identify ways to minimize your tax liability.

Final Thoughts on Tax Reporting for Stock Compensation

By understanding the purpose of each form, gathering all necessary paperwork, and taking a step-by-step approach, you can confidently tackle the intricacies of tax reporting for stock compensation. Keeping detailed records and seeking expert advice when needed will make the process much smoother. While helping you avoid costly errors.

Take control of your tax season today, and ensure your stock compensation works for you, not against you!

Resources for Tax Reporting for Stock Compensation

Plan Your Stock Compensation for the Year

ESPPs: A Comprehensive Guide

This article was originally published here and is republished on Wealthtender with permission.

About the Author

Matthew Nelson, CFP® AIF® ECA Specialized Financial Planning for MedTech Professionals

Matthew Nelson, CFP® AIF® ECA | Perspective 6 Wealth Advisors

🔗 Website | Wealthtender Profile

Frankly, I’ve never had a financial advisor (other than an accountant).

It’s not that I think advisors aren’t helpful, but, not to beat my drum, I’ve done just fine on my own.

That was then.

When I was in the accumulation phase. All I needed was a budget and a plausible investment plan, and neither seemed too hard to do for myself.

Now, I expect to reach “work-optional” status in a few months, and that’s when I expect things to be more complicated.

What Would a Financial Advisor Help With?

According to NerdWallet, the main things an advisor can help with are:

Personal finance, including retirement planning
Debt management and repayment (if you have debt; this is really a subset of personal finance, but it’s important enough to warrant separate mention)
Investment advice and/or management
Tax strategy and planning
Estate planning

I would add to this insurance planning – what coverages you need, how high they should be, where to buy them, etc., and charitable giving – what vehicles are best, how to set them up, etc. This latter connects deeply with tax strategy.

If you’re like me, you’d prefer one financial advisor who can help with as many of the above as possible, though most advisors would likely bring in an attorney to help with estate planning and an insurance agent for that specialized service.

That’s what most people would potentially want help with. In my case, I mainly want the following:

Review my existing (DIY) financial plan
Review my existing (also DIY) asset allocation
Review our financial goals and aspirations
Suggest what we should be doing that we aren’t already doing (e.g., permanent life insurance, strategic Roth conversions, low-cost annuities, and anything I don’t know enough to mention here…)
Suggest how we should modify our asset allocation and whether we can safely draw the amounts I’ve budgeted (using Monte Carlo analysis and analysis of the current and projected markets)
Provide ongoing advice as to how much to draw annually and which account(s) to draw from to optimize our taxes and react to our portfolio performance

What I need is someone I can trust with all the details of our finances and with control of at least some of our portfolio, who can provide top-notch advice, who has an investing philosophy compatible with mine, and who will tell me straight if I’m about to make a mistake or at least make a sub-optimal choice. Ideally, I want someone younger than me so they’d be less likely to retire before I’m gone, but not too young to have lots of experience and a solid track record.

Finding a Financial Advisor Will Keep Getting Harder

If you expect to want an advisor sometime over the coming decade, there’s bad news.

According to McKinsey & Company, demand for financial advisors will increase by 28% to 34% by 2034. They cite the faster growth in affluent families compared to the overall population, and a growing desire for human advisors (and a willingness to pay for it).

With such robust and growing demand, you’d expect the marketplace to draw new talent to fill the gap.

You’d be wrong.

The McKinsey study estimates that 42% of current advisors will retire by 2034, and new hires will not keep pace with those losses, let alone provide a large enough advisory workforce to meet the expected increase in demand.

Overall, the study projects a shortfall of 90,000 – 110,000 advisors by 2034, about 25% of the needed number. Increasing automation and team support can cover a portion of this shortfall, but 30,000 to 80,000 more advisors will likely be needed than those who will be available.

The study makes several recommendations for how the industry can resolve this problem, but many of those recommendations will require a massive overhaul of how new advisors are recruited, compensated, and trained.

Given how reluctant people, especially people in positions of power, are to make big changes in the system that put them in those positions, I wouldn’t hold my breath waiting for these changes to be implemented.

With such a huge fraction of current financial advisors expected to retire, a thin pipeline of new talent willing to be hired, and an increasing pool of prospective clients, it’s easy to see the unfolding scarcity.

We can make some pretty solid guesses as to who would be most impacted.

Younger families with smaller portfolios, so the “Assets-Under-Management” (AUM) fees they bring in are small.
Retirees and near-retirees who don’t already have an advisory relationship and are unwilling to move all their assets from current accounts to an advisory account that charges about 1% of portfolio value per year(yeah, that’s me).
Remarkably, even the uber-wealthy, who want to start a so-called “family office,” are already having a hard time, according to CNBC, with demand expecting to rise by 33% in the next five years. This is because family offices come across as an especially risky position for early-career professionals, because in this space, trust overrides performance, and if the wrong single person decides he or she doesn’t like or trust you, you’re gone.

What Are the Main Causes of the Shortage?

I asked some advisors for their thoughts on why their profession seems to be contracting when they need to grow if they’re to meet client demand. Here’s what they had to say.

Lawrence D. Sprung, CFP®, Founder, Wealth Advisor, Mitlin Financial, says, “Hiring new advisors has been, and I believe will continue to be, a challenge. I think the reason is the high washout rate in the profession. Many college graduates who could eventually be great advisors go to work for sales organizations that just try to see what sticks. This creates an environment for the advisor that gives them a bad taste, and ultimately, they leave the profession before they even have a shot.

“We need to identify those people who would be ideal candidates and put in the effort needed to develop them, so this doesn’t continue to happen. We also need to educate them on what firms create an environment that will be good for them to grow, and which others are simply interested in who and how much they can sell. That’s why at my firm, we’re creating a development path to train and mentor newly minted advisors so they can learn, develop, grow, and become joyful advisors.”

Benjamin Simerly, CFP®, Financial Advisor at Lakehouse Family Wealth elaborates, “While we have the effects of old practices to overcome, there’s a major positive shift taking place. When it comes to hiring advisors, the pool of applicants is often tainted by parents’ opinions of the advisory industry that they pass on to our applicant pool. These opinions of the finance industry are, unfortunately, often earned.

“It’s our responsibility, as comprehensive planners, to earn back respect from the American public. Fortunately, many colleges and comprehensive planning firms are making big strides in this area by hiring serious financial planning professors for CFP® (Certified Financial Planner®) -approved undergraduate and graduate programs. Students in these programs are learning just how comprehensive our work is, and the seriousness with which firms all over the country take their responsibility to clients. Graduates of such new, rigorous programs will soon be at the age and tenure to make major changes in hiring at their firms.

“True advisory firms reach out to students, saying, ‘If you’re willing to put in the work, this can be a career for life where not only do you not have to compromise ethics, but you can build a career on them.’ Increasingly, this draws out the best of the best who want to balance family life with a meaningful career.

“This is a win-win for everyone. Colleges see increased enrollment, and students can look forward to practical salaries along with a sense of purpose. These changes help foster advisors who see this work as a calling to help families, which benefits their ultimate clients.”

Why You Should Care (or at Least Why I Care)

This may seem like it’s an industry problem.

But beyond that, it’s very much a you and me problem.

If there are 25% fewer advisors than what’s needed to serve demand, we can expect three things to happen:

Waitlists for top talent
Just like in any market, with demand outstripping supply, prices will likely increase, at least for new clients
With firms unable to recruit enough new talent, some may be forced into hiring less-qualified people, or at the very least, offering less personalized guidance.

What You Can Do Now (It’s What I’m Doing)

In the above, we saw the bad news.

But it’s not all bad news. There is some good news – we can take proactive steps now to make sure we’re not the ones left standing when the music stops.

Start early: If you think there’s at least some value for you in having a financial advisor, don’t put it off for some nebulous “later” time.
Vet carefully: You’re about to share a lot of very sensitive info with whomever you hire, and likely hand over control of what’s significant money for you. This isn’t something you want to do with just anyone who’s calling him or herself an advisor. Collect recommendations from the wealthiest people you know (and with whom you have a relationship that makes that sort of question acceptable), vet the credentials of proposed advisors, read their client reviews, and interview several people to find the one who’s the best fit for you.
Think outside the box: Sure, there are plenty of large traditional firms. Those may or may not be your best bet. Many smaller firms may provide far more personalized service. However, make sure you know, and are comfortable with, their succession plan, because nobody is promised tomorrow, not even your trusted advisor.
Build the relationship now: Once you find your best-fit advisor and hire him or her, nurture that relationship. Set up regular meetings, share with them important things that happen in your life, even if they’re not strictly financial, and when you’re happy with their service, let them know – everyone wants to feel appreciated, especially when they do a great job. The closer your relationship, the more likely they’ll prioritize you over others (at least others who aren’t 10x wealthier than you).
Learn as much as you can about AI-driven developments in financial management: The more you can do for yourself with automated tools (e.g., robo-advisors), the easier it will be to handle more minor issues if your advisor is swamped, and the more intelligent your questions and requests will be.

Brennan Decima CFP®, Owner of Decima Wealth Consulting, agrees especially with the first point, but adds an important cautionary note, “Don’t wait until a crisis or a major milestone to start your search. The earlier you begin to search, the more options you’ll have. Focus on an advisor who is a fiduciary who specializes in your specific situation rather than a generalist. If you’re not sure if they’re a fiduciary, ask for their conflicts of interest and compensation disclosure before anything else.”

Simerly offers some nuanced advice to those looking for an advisor, “When looking to hire a financial advisor, it’s all about the fit, and you should interview at least 3-5 potential advisors before picking the one you’ll hire. On the flip side, the best advisors turn away 2-5 times as many prospective clients as they take on, to ensure each one they accept will benefit most from their advisory service! This may mean the firm niches down to, say, families with children, pre-retirees, dentists, small-business owners, etc. By tightening their focus like that, they have the specialized experience and expertise their clients will value.

“Another important matter is how advisors bill, rather than how they’re licensed. Some licenses advisors must have if they’re to manage clients’ portfolios and provide access to higher-quality alternative investments require them to say that they are ‘fee-based,’ which some clients shy away from.

“However, even if an advisor has to say that they’re fee-based, what’s really important to the client is how they actually bill, so that’s what prospective clients should ask. There are many ways advisors can bill without being biased toward what pays them the highest compensation. This includes fee-based, flat-fee, fee-only, Assets Under Management (AUM), or Assets Under Advisement (AUA) billing. When interviewing advisors, make sure you understand how they bill and what that means in your case, and make sure you’re comfortable with that.”

The Bottom Line

The supply vs. demand picture in the financial advice industry is becoming more dire with time, not less. But this doesn’t mean you’re stuck.

Taking prudent action now will make it less likely that you’ll be among those who can’t find a trusted advisor when you most need one.

Disclaimer: This article is intended for informational purposes only, and should not be considered financial advice. You should consult a financial professional before making any major financial decisions.

About the Author

Opher Ganel, Ph.D.

My career has had many unpredictable twists and turns. A MSc in theoretical physics, PhD in experimental high-energy physics, postdoc in particle detector R&D, research position in experimental cosmic-ray physics (including a couple of visits to Antarctica), a brief stint at a small engineering services company supporting NASA, followed by starting my own small consulting practice supporting NASA projects and programs. Along the way, I started other micro businesses and helped my wife start and grow her own Marriage and Family Therapy practice. Now, I use all these experiences to also offer financial strategy services to help independent professionals achieve their personal and business finance goals. Connect with me on my own site: OpherGanel.com and/or follow my Medium publication: medium.com/financial-strategy/.

Learn More About Opher

Do you work at AT&T? Get the resources you need and expert insights from financial professionals who specialize in helping AT&T employees make the most of their compensation package and benefits.

Whether you’re a new AT&T employee or you’ve moved up the ranks into a management or executive leadership role over a multi-year career, it’s important to make smart money moves with your income and employee benefits. For example:

✅ Do you know the right moves to make to get the greatest value from the AT&T benefits available to you?

✅If you’re thinking about leaving AT&T for another job or planning to retire from the company in a few years, are you taking the right steps today to ensure you will receive all of the compensation and benefits that you’ve earned?

Get the Most Value from Your AT&T Benefits and Compensation Package

Throughout the year, AT&T provides its employees and executives with updates about their benefits ranging from health insurance and health savings plans to retirement plans like a 401(k), deferred compensation plans, and stock options. While the company offers many useful resources and access to knowledgeable staff who can assist with questions, you’ll also find financial professionals not affiliated with AT&T who specialize in helping AT&T employees make the most of their income and benefits.

Whether you work in the AT&T headquarters in Dallas, Texas, another office location around the country, or remotely from home, you may have questions about your compensation package and benefits better suited for a financial professional who can offer unbiased advice and guidance.

For example, sensitive topics like discussing the steps you should take before quitting your job at AT&T to work elsewhere, protecting yourself in advance of a corporate layoff, or deciding when you should plan to retire are all conversations that may be more comfortable with a trusted financial advisor.

Should you hire a AT&T specialist financial advisor or an advisor close to home?

You’ll likely find dozens of nearby financial advisors well-suited to help you reach your money goals with a personalized plan. But it may be more difficult to find a financial advisor who specializes in serving AT&T employees.

Fortunately, many financial advisors offer virtual services so you can meet online no matter where you (or they) live.

This means you can choose to hire a specialist financial advisor who lives hundreds of miles away if you decide their knowledge and experience working with AT&T employees is a better fit to help with your unique needs.

💡 In the Q&A below, you’ll gain insights from financial advisors who work with AT&T employees to help them make smart decisions to get the most value from their compensation and benefits, reduce their money stress, and prepare for a comfortable retirement.

🙋‍♀️ Do you have questions not yet answered? Use the form below to submit questions anonymously and watch this article for updates with answers to your questions. You can also reach out to the financial advisors below to set up an introductory call or contact them with your questions by email.

💸 Smart Money Insights for AT&T Employees & Executives

This page is organized into sections to help you quickly find the information you need and get answers to your questions:

Q&A: Financial Planning Tips for AT&T Employees & Executives
Get Answers to Your Questions About Your AT&T Benefits and Career
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Q&A: Financial Planning Tips for AT&T Employees & Executives

Answers to AT&T Employee Questions with Ryan Nelson

Ryan Nelson is a financial advisor based in Reno, Nevada who specializes in offering financial planning services to AT&T employees. Ryan helps his clients get the most value from their AT&T benefits and compensation package so they can enjoy life and feel confident about their financial future.

Q: Is there a particular benefit available to AT&T employees you feel isn’t as well utilized or understood by employees as it should be?

Ryan: Many employees do not fully understand the flexibility in how their 401(k) contributions and employer match can be invested. For example, AT&T’s matching contributions are initially made in company stock, but you can reallocate those funds to other investment options at any time. This allows you to diversify and better manage risk. Another underused feature is the ability for eligible employees to make catch-up contributions starting at age 50, which can significantly boost retirement savings in the final working years.

Q: For AT&T employees approaching retirement age, how do you recommend they prepare to make the transition from living off their salary to relying upon other sources of income?

Ryan: The key is building a detailed retirement income plan well before your last day at work. Identify all sources of income, such as your pension, 401(k), Social Security, and personal savings. Create a monthly budget that reflects your expected spending in retirement and test whether your income sources can support it. It is also important to understand how taxes, healthcare costs, and inflation will affect your plan. Ideally, begin this process at least 3–5 years before retiring so you have time to make adjustments.

Q: For AT&T employees who have managed their finances on their own to this point, what would you suggest they consider to help them decide if they should begin working with a financial advisor at this stage in their lives?

Ryan: Ask yourself whether you have the time, knowledge, and desire to manage all aspects of your retirement plan confidently. An advisor can help you integrate your AT&T benefits, investments, and tax strategy into a single coordinated plan. This can be especially valuable during retirement, when timing, withdrawal strategy, and benefit elections can have lasting effects on your income and security. Even if you enjoy managing your finances, a second set of eyes can help you spot opportunities or risks you might miss on your own.

Q: What questions do you recommend AT&T employees ask financial advisors they’re considering hiring to help them decide if they’re a good fit?

Ryan: Ask about their experience working with clients who have similar retirement benefits, how they are compensated, and whether they act as a fiduciary at all times. Find out how they create retirement income plans, how they approach investment risk, and how they will coordinate with your tax professional. Finally, ask what their ongoing service looks like after the initial plan is built, so you understand how they will support you through the different stages of retirement.

Q: For highly compensated AT&T employees and executives, are there any special benefits you believe it’s important to take into consideration when preparing their financial plan?

Ryan: Higher earners may have access to benefits such as deferred compensation plans and stock-based awards. These can provide valuable opportunities for tax deferral and long-term wealth building, but they also require careful planning around distribution timing and tax impact. The key is to coordinate these benefits with your pension, 401(k), and other investments so that your income in retirement is well-structured, tax-efficient, and sustainable.

Q: Should I take my AT&T pension as a lump sum or a monthly annuity?

Ryan: There is no single right answer. The lump sum option gives you control over the money, flexibility in how and when it is used, and the potential for growth if invested wisely. However, it also comes with market risk and requires disciplined management to ensure the funds last throughout retirement. The annuity option provides predictable monthly income for life, removing the need for investment management and market risk. The trade-off is that you give up control over the funds, the payments stop when you and your eligible survivor pass away, and you may not have a legacy to pass on. For some AT&T management employees, it is possible to split between a lump sum and annuity to balance flexibility with stability. Interest rates play a big role in the value of the lump sum, so comparing both options using realistic assumptions is essential before making a final decision.

Q: How do interest rates affect the value of my AT&T pension lump sum?

Ryan: AT&T bases each year’s lump sums on IRS segment rates set the prior November. When rates increase, lump sum values go down. When rates decrease, lump sums rise. This timing can make a significant difference (sometimes tens of thousands of dollars).

If rates are trending up, retiring before the higher rate year is applied could preserve more value. If rates are dropping, delaying your retirement may increase your lump sum. These decisions are time-sensitive and depend on your individual eligibility and life plans. It is important to track segment rate changes and confirm with AT&T’s pension administration team when a rate will take effect for your calculation. Planning your retirement date with this in mind can have a major impact on your retirement income.

Q: What is AT&T’s Modified Rule of 75 and why does it matter?

Ryan: The Modified Rule of 75 is AT&T’s age-plus-service formula to qualify for enhanced retiree benefits. You meet the rule when your age and years of service add to at least 75 and you satisfy specific minimums: 50 years old with 25 years of service, 55 with 20 years, 60 with 15 years, 65 with 10 years, or 30 years of service at any age. Reaching this milestone unlocks eligibility for your full pension, retiree health insurance, and life insurance coverage. If you leave before meeting the Rule of 75, your pension could be reduced and you may lose access to retiree health benefits altogether. If you are close to qualifying, it is often worth staying until you meet the requirements, as the long-term value of the benefits can be substantial.

Q: What are the most common mistakes AT&T employees make when retiring?

Ryan: Some of the most costly mistakes include:

Retiring before reaching the Rule of 75 or age 55, losing valuable benefits or facing penalties.
Choosing between lump sum and annuity without a detailed side-by-side comparison.
Overlooking the impact of interest rate changes on lump sum values.
Not planning survivor benefits, leaving spouses at risk.
Mismanaging 401(k) withdrawals or holding too much company stock.

Avoiding these mistakes starts with early planning. Work with an advisor who understands AT&T’s benefit structure so your timing, elections, and investment strategy work together to maximize lifetime income.

Q: How does AT&T retiree healthcare work and what does it cost?

Ryan: If you meet the Rule of 75, you can keep AT&T health coverage before Medicare, but you pay the full premium; amounts vary by plan and region. This coverage can be valuable if you retire before age 65 and need a bridge until Medicare. Once you reach age 65, you transition to Medicare and may be eligible for supplemental plans through AT&T’s benefits partner. Most management retirees no longer receive company-paid premium subsidies, so budgeting for healthcare is critical. The cost difference between pre-Medicare and Medicare coverage can be significant, so factor these changes into your retirement cash flow plan.

Q: What are my AT&T pension survivor benefit options?

Ryan: If you pass away before retiring, your spouse could receive up to 50 percent of your earned pension for life or a lump sum equivalent. When you retire, you choose between 0, 50, 75, or 100 percent survivor benefits for your annuity. The higher the survivor benefit, the lower your monthly payment. Lump sums do not provide ongoing survivor income but can be left to heirs as a financial asset. Once you retire and make your choice, your survivor benefit election is typically permanent. Choosing the right option depends on your spouse’s income needs, life expectancy, and other available assets.

Q: How can I access my AT&T 401(k) without penalties if I retire early?

Ryan: If you separate from AT&T in or after the year you turn 55, you can take penalty-free withdrawals from your AT&T 401(k). This “age 55 rule” does not apply to IRAs, so rolling over to an IRA immediately could remove this benefit. Management employees can take monthly or ad-hoc withdrawals from the AT&T plan. Union employees can take up to four withdrawals per year. If you will need access to your savings before 59½, consider leaving funds in the 401(k) until you no longer need the penalty-free provision.

Q: What are the AT&T 401(k) contribution limits and match?

Ryan: AT&T provides a generous match of 80% on your first 6% of pay, effectively adding up to 4.8%. Matching contributions invest initially in AT&T stock, though you can reallocate them later. Make sure to contribute at least 6% to capture the full employer match – it’s free money once you’re eligible (typically after one year of service).

Q: How do AT&T stock awards and deferred compensation work in retirement?

Ryan: For eligible employees, deferred compensation distributions are paid out at retirement according to your prior elections, often as a lump sum per your elections. This payout is fully taxable in the year received, so planning for the tax impact is important. Restricted stock units (RSUs) and stock options may continue to vest after retirement if you meet AT&T’s retirement eligibility rules. If not, unvested shares are usually forfeited. Review your grant agreements to understand how your retirement date impacts your equity.

Q: How secure is my AT&T pension after the Athene transfer?

Ryan: In 2023, AT&T transferred the pensions of about 96,000 retirees to Athene, a private insurance company. Benefit amounts did not change, but the Pension Benefit Guaranty Corporation (PBGC) protection was replaced by state guaranty association coverage, which has limits. Athene is financially strong, but insurer protection differs from federal backing. Current employees’ pensions are still AT&T-backed, although future transfers are possible. Understanding who backs your benefit and any applicable coverage limits is an important part of risk management in retirement.

Get to Know Ryan Nelson, Financial Advisor for AT&T Employees:

Alchemy Wealth Management Ryan Nelson

Reno, Nevada

Serving Clients Nationwide

Trusted Retirement & Financial Planning in Reno, NV

37 Certified Advisor Reviews™

Areas of Focus

Employee Benefits Estate Planning Financial Life Planning Investment Management Retirement Planning

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View Ryan’s profile page on Wealthtender or visit his website to learn more.

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Do you work at Providence Health & Services? Get the resources you need and expert insights from financial professionals who specialize in helping Providence employees make the most of their compensation package and benefits.

Whether you’re a new Providence employee or you’ve moved up the ranks into a management or executive leadership role over a multi-year career, it’s important to make smart money moves with your income and employee benefits. For example:

✅ Do you know the right moves to make to get the greatest value from the Providence benefits available to you?

✅If you’re thinking about leaving Providence for another job or planning to retire from the healthcare system in a few years, are you taking the right steps today to ensure you will receive all of the compensation and benefits that you’ve earned?

Get the Most Value from Your Providence Benefits and Compensation Package

Throughout the year, Providence provides its employees and executives with updates about their benefits ranging from health insurance and health savings plans to retirement plans like a 401(k), and deferred compensation plans. While the healthcare system offers many useful resources and access to knowledgeable staff who can assist with questions, you’ll also find financial professionals not affiliated with Providence who specialize in helping Providence employees make the most of their income and benefits.

Whether you work in the Providence headquarters in Renton, Washington, another office location around the country, or remotely from home, you may have questions about your compensation package and benefits better suited for a financial professional who can offer unbiased advice and guidance.

For example, sensitive topics like discussing the steps you should take before quitting your job at Providence to work elsewhere, protecting yourself in advance of a layoff, or deciding when you should plan to retire are all conversations that may be more comfortable with a trusted financial advisor.

Should you hire a Providence specialist financial advisor or an advisor close to home?

You’ll likely find dozens of nearby financial advisors well-suited to help you reach your money goals with a personalized plan. But it may be more difficult to find a financial advisor who specializes in serving Providence employees.

Fortunately, many financial advisors offer virtual services so you can meet online no matter where you (or they) live.

This means you can choose to hire a specialist financial advisor who lives hundreds of miles away if you decide their knowledge and experience working with Providence employees is a better fit to help with your unique needs.

💡 In the Q&A below, you’ll gain insights from financial advisors who work with Providence employees to help them make smart decisions to get the most value from their compensation and benefits, reduce their money stress, and prepare for a comfortable retirement.

🙋‍♀️ Do you have questions not yet answered? Use the form below to submit questions anonymously and watch this article for updates with answers to your questions. You can also reach out to the financial advisors below to set up an introductory call or contact them with your questions by email.

💸 Smart Money Insights for Providence Employees & Executives

This page is organized into sections to help you quickly find the information you need and get answers to your questions:

Q&A: Financial Planning Tips for Providence Employees & Executives
Get Answers to Your Questions About Your Providence Benefits and Career
Browse Related Articles

Q&A: Financial Planning Tips for Providence Employees & Executives

Answers to Providence Employee Questions with Noah Schwab, CFP®

Noah Schwab is a financial advisor based in Spokane, Washington who specializes in offering financial planning services to Providence Health & Services employees. Noah helps his clients get the most value from their Providence benefits and compensation package so they can enjoy life and feel confident about their financial future.

Q: As a financial advisor with experience helping Providence employees save for their retirement, how do you help them make the most of their employee benefits?

Noah: Providence offers a comprehensive set of benefits designed to support caregivers throughout their careers and in retirement. I assist employees in learning how to maximize these benefits in combination to create a strong financial foundation.

Providence’s 401(k) plan, managed by Fidelity, includes employee contributions with a company match and an annual discretionary contribution based on hours worked and tenure. Employee contributions are always fully vested, whereas employer contributions vest on a schedule tied to the number of years of service. Understanding this helps employees plan for their long-term savings and when they might access employer funds.

For higher-income individuals, the 457(b) deferred compensation plan offers more tax-deferred savings with immediate vesting and is an excellent supplement to retirement savings beyond the 401(k) maximum. Beyond retirement plans, I cover Health Savings Accounts, life insurance, and disability insurance.

By bringing all of these elements together in one overarching plan, Providence employees gain clarity and confidence in their financial future, knowing that they’re not leaving anything on the table.

Q: When you first speak with a Providence employee, what questions do you like to ask to better understand their unique circumstances and determine how you can best help them achieve their goals?

Noah: When I first meet with a Providence employee, I ask a few key questions to understand their financial situation and goals. I want to know about their current retirement savings, including whether they are contributing to the 401(k), 457(b), or any legacy 403(b) plans.

I ask about their student loan status to see if they are taking advantage of the student debt retirement match program. Understanding their healthcare coverage and whether they use Health Savings Accounts or Flexible Spending Accounts is also important.

I explore their career plans, such as whether they expect to stay with Providence in the long term, retire soon, or consider other career opportunities. This helps me assess vesting timelines for employer contributions, tax strategies for retirement plan withdrawals, and plans for potential changes.

Finally, I ask about their personal goals, like retirement age, plans for paying off debt, education funding, or any major life events. This helps me create a customized plan that aligns their benefits with what matters most to them.

Q: Is there a particular benefit available to Providence employees you feel isn’t as well utilized or understood by employees as it should be?

Noah: Yes, one benefit overlooked for younger employees is the Student Debt Retirement Savings Match Program. Many Providence employees are unaware that they can receive employer contributions to their 401(k) when making student loan payments, even if they are not actively contributing themselves.

Another benefit that is sometimes underused is the 457(b) Deferred Compensation Plan. It offers a great opportunity to save beyond the 401(k) limits with immediate vesting and no early withdrawal penalties. Normally, employee contributions to a 401(k) and a 403(b) are aggregated together toward the annual IRS limit, meaning you can only contribute a combined total between the two. The 457(b) is different; it has its separate contribution limit that does not count toward the 401(k) or 403(b) maximum. This essentially doubles the amount you can set aside in tax-deferred accounts each year, making it especially valuable for higher earners or anyone looking to accelerate their retirement savings.

Finally, the Health Savings Account connected to high-deductible health plans is a powerful tool that many don’t fully use for both current medical costs and long-term tax-advantaged savings.

Q: Beyond Providence employee benefits for retirement savings, are there other types of benefits offered by the healthcare network that you find valuable to discuss with your clients?

Noah: Yes, Providence offers several important benefits beyond retirement plans that I often discuss with clients. Their Health Savings Accounts are a key tool, especially for those on high-deductible health plans. HSAs provide tax advantages and can be used for current healthcare expenses or saved for the future.

The Flexible Spending Accounts help employees manage medical and dependent care costs on a tax-free basis, which can improve cash flow.

Providence also offers a lot of career development programs, including tuition assistance and fully funded degrees in select healthcare fields. This benefit can help reduce student loan debt or increase employees’ earning potential.

Additionally, I assist in navigating voluntary benefits, such as legal, disability, or pet coverage.

Q: For Providence employees thinking about leaving the healthcare network to accept a job elsewhere, what actions do you recommend they take before resigning and shortly thereafter?

Noah: Before leaving Providence, I recommend employees review their retirement accounts, especially their 401(k), 457(b), and any legacy 403(b) plans. It’s important to understand vesting schedules for employer contributions and how leaving might affect those funds.

I also suggest they check on any discretionary contributions or matching contributions they may be eligible for and confirm the timing for final contributions and distributions.

After resigning, they should decide whether to keep their retirement savings in Providence’s plans, roll them over to a new employer’s plan, or move them into an IRA. This decision depends on investment options, fees, and their long-term goals.

Finally, I advise reviewing benefits like health insurance coverage options after employment ends and understanding COBRA or alternative coverage choices.

Taking these steps early helps protect their savings and ensures a smooth transition to the next phase of their career.

Q: For Providence employees approaching retirement age, how do you recommend they prepare to make the transition from living off their salary to relying upon other sources of income?

Noah: Before leaving Providence, I recommend employees review their retirement accounts, especially their 401(k), 457(b), and any legacy 403(b) plans. It’s important to understand vesting schedules for employer contributions and how leaving might affect those funds.

I also suggest they check on any discretionary contributions or matching contributions they may be eligible for and confirm the timing for final contributions and distributions.

After resigning, they should decide whether to keep their retirement savings in Providence’s plans, roll them over to a new employer’s plan, or move them into an IRA. This decision depends on investment options, fees, whether they are implementing tax strategies such as a backdoor Roth, and their long-term goals.

Finally, I advise reviewing benefits, such as health insurance coverage options, after employment ends and understanding COBRA or alternative coverage choices.

Taking these steps early helps protect their savings and ensures a smooth transition to the next phase of their career.

Q: For Providence employees who have managed their finances on their own to this point, what would you suggest they consider to help them decide if they should begin working with a financial advisor at this stage in their lives?

Noah: The most important step is to create a retirement income plan well in advance of your last day at Providence. This means knowing exactly how much income you’ll need each month, identifying which sources will provide it, such as your 401(k), 457(b), Social Security, or pensions, and deciding when to start each one. Begin by calculating your monthly retirement income needs, then subtract your guaranteed income sources, such as Social Security and pensions. From there, determine whether your investments can sustainably cover the gap. This is also the time to explore opportunities for Roth conversions in lower-income years, which can help reduce future taxes on required minimum distributions (RMDs). Planning reduces uncertainty, lowers tax surprises, and gives you the confidence to retire on your terms.

Q: What are some of the unique financial planning challenges you commonly see among your clients who are Providence employees and how do you help them overcome these obstacles?

Noah: As you approach retirement, the stakes get higher. Decisions about when to claim Social Security, Roth conversions, RMD planning, how to draw from your Providence 401(k) or 457(b), and how to manage taxes can have long-term consequences. A Certified Financial Planner® can help you create a coordinated plan that covers income strategy, tax planning, investment allocation, and estate considerations. Even if you’ve done well managing things on your own, having a second set of experienced eyes can help you avoid costly mistakes and uncover opportunities you might not have considered.

Q: What questions do you recommend Providence employees ask financial advisors they’re considering hiring to help them decide if they’re a good fit?

Noah: When interviewing a financial advisor, it’s important to go beyond investment performance and ask questions that reveal their expertise and alignment with your needs. For Providence employees, consider asking:

How familiar are you with the Providence 401(k), 457(b), and any legacy 403(b) plans?
Do you incorporate tax planning into your advice, including strategies like Roth conversions and managing required minimum distributions?
Are you a fiduciary who is legally obligated to act in my best interest?
How are you compensated, and are there any potential conflicts of interest?

· What is your experience helping clients transition from earning a salary to drawing from retirement accounts?

Asking these questions can help you identify an advisor who understands your unique benefits and can build a plan tailored to you.

Q: Is there anything that comes up frequently in your initial meeting with Providence employees that surprises you?

Noah: One of the biggest surprises I observe is the number of Providence employees who are unaware of the full range of retirement benefits available to them, especially the 457(b) plan and its potential to be used in conjunction with the 401(k). Many don’t realize the contribution limits for the 457(b) are separate from the 401(k), effectively doubling their ability to save on a tax-advantaged basis. Another common surprise is the extent of control they have over when and how they take withdrawals in retirement, which can open up opportunities for tax planning strategies, such as Roth conversions. Often, employees also underestimate the value of reviewing old retirement accounts from previous employers, which Fidelity may not manage.

Q: For highly compensated Providence employees and executives, are there any special benefits you believe it’s important to take into consideration when preparing their financial plan?

Noah: Yes. Highly compensated Providence employees and executives often have access to benefits that can significantly enhance their retirement and tax planning strategies. The Providence 457(b) Deferred Compensation Plan is a major opportunity, since contributions are not limited by the 401(k) cap and can be withdrawn without the early withdrawal penalty once you separate from service, regardless of age. It’s also important to understand the vesting schedule for employer contributions in the 401(k) and to coordinate contribution timing if you’re nearing a vesting milestone. For executives, there may be additional nonqualified deferred compensation arrangements or supplemental retirement benefits that require careful planning to optimize payouts and manage the tax impact. Integrating these benefits with outside investments can help ensure you’re minimizing taxes and securing long-term income.

Q: Is there a particularly memorable experience or a moment you recall with a client who worked at Providence when you realized they have unique opportunities and circumstances when it comes to their financial planning needs?

Noah: Yes. I remember meeting with a Providence employee who had both the 401(k) and 457(b) plans fully funded for several years before retirement. They were also receiving a generous pension, which, when combined with their savings, created more flexibility than they had realized. We designed a plan that allows them to retire earlier than expected, draw from their 457(b) account without penalty, and convert a portion of their 401(k) to a Roth IRA during lower-income years, thereby reducing future tax burdens. It was a great reminder that Providence employees, especially those who use their benefits to the fullest, often have unique planning opportunities that can significantly accelerate financial independence and improve long-term outcomes.

Get to Know Noah Schwab Financial Advisor for Providence Employees:

Stewardship Concepts Financial Services Noah Schwab, CFP®

Spokane, Washington

Serving Clients Nationwide

Helping retirees maximize $1M+ in a 401(k) with Roth conversions & tax planning.

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Ask an Advisor: What role should alternative investments play in the portfolio of a married couple in their thirties or forties looking to diversify and manage risk?

A smiling man in a blue suit stands in the foreground of a modern, brightly lit office with glass walls and blurred desks in the background. — Image Credit: Wealthtender.

First off, I want to commend you for thinking beyond the usual mix of stocks and bonds. Exploring alternative investments in your thirties or forties is a smart, forward-thinking way to diversify and manage risk while building wealth.

What Are Alternative Investments, and Why Now?

Alternative investments can make a considerable impact in a well-rounded portfolio, especially at this stage of life. You’re still in your prime growth years, with enough time before retirement to take advantage of longer-horizon opportunities.

Types of Alternatives That Can Support Your Long-Term Goals

Alternative investments span a wide range of investment types, including income-generating real estate, private credit, and more growth-focused opportunities like venture capital, private equity, and cryptocurrency. Depending on your portfolio size, they might also include diversified funds in venture, growth, or hedge strategies. What these investments often share is that they don’t move in sync with the public stock market. That’s a good thing. Including assets with different behavior patterns can help reduce overall volatility and create a steadier experience during market ups and downs.

Private market investments can offer access to innovative companies and growing businesses before they go public—or instead of going public at all. Once limited to institutions and endowments, these opportunities are now being used by today’s high-earning families and professionals to complement their public holdings and position themselves for long-term success.

Know the Tradeoffs: What to Consider Before You Invest

Of course, these investments come with critical considerations: longer lock-up periods, less liquidity, and a higher entry threshold. But as your portfolio grows, it may make sense to look at diversified strategies that offer attractive returns without daily market swings. And when done thoughtfully, a blend of private investments can support both growth and income goals, depending on your needs.

The key is making sure these investments are intentionally aligned with your life stage, comfort with risk, and long-term financial goals.

Aligning Your Portfolio with Purpose

Alternatives aren’t a one-size-fits-all solution, and not every advisor works with them. If you’re exploring your options, a knowledgeable partner can help you weigh the pros and cons in a way that fits your life and goals.

Exploring alternatives can be exciting, but it’s not about chasing the latest trend. It’s about building a thoughtful, purpose-driven plan that supports your long-term vision. That’s why we take a personalized approach to private market investing, helping high-income families integrate alternatives in ways that match their goals, timelines, and comfort with risk.

If you’re thinking about adding private investments to your portfolio, we’re here to help you explore what makes sense for your goals. Schedule a consultation to get started.

Sean Gerlin, CFP®, CPWA®, ChFC®, CLU®, is the Founder and Principal of Envision Wealth Planners, a fee-only financial advisory firm based in the greater Orlando area. Sean specializes in helping high-income families, business owners, and commercial real estate executives align their wealth with their values through a comprehensive Financial Life Planning approach. Learn more about them at envisionplanners.com.

This material has been edited with the assistance of artificial intelligence tools. The information presented is based on sources believed to be reliable and accurate at the time of publication. This material is for educational purposes only and does not necessarily reflect the views of the author, presenter, or affiliated organizations. It should not be construed as investment, tax, legal, or other professional advice. Always consult a qualified professional regarding your specific situation before making any decisions.

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This article was originally published on Wealthtender and is intended for informational purposes only and should not be considered financial advice. You should consult a financial professional before making any major financial decisions. Wealthtender earns money from financial professionals, which creates a conflict of interest when these professionals are featured in articles over others. Read the Wealthtender editorial policy and terms of service to learn more. Wealthtender is not a client of these financial services providers.

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I’m fast approaching retirement, or as I prefer to say, “work-optional status.” And my mortgage is nowhere near paid off.

This got me thinking – should we follow conventional wisdom and pay off our mortgage now, or keep paying it into retirement?

Retiring Mortgage-Free: The Conventional Mindset

If you’ve paid any attention to personal finance advice, this one should be very familiar: “Don’t enter retirement before you pay off your mortgage!”

And, honestly, it seems to make a lot of sense.

Paying off your mortgage can sharply reduce your monthly expenses and improve your cash flow.
Paying off the mortgage removes a large monthly payment, simplifying your budgeting. This is especially important because research shows that you can increase your so-called safe withdrawal rate – the percentage of your portfolio you can draw each year with minimal risk of running out of money before you die – if more of your budget is discretionary. And clearly, removing a multi-thousand-dollar non-discretionary monthly expense will move the needle significantly toward a lower fixed-expense fraction.
As they say, none of us is promised tomorrow – and if you own your home free and clear, your heirs have more options once they inherit – there’s no debt they must pay off, so they can keep the home and do with it as they prefer. Whether that’s moving into it, renting it out, using it as a vacation home, etc.
Owning your home outright means you have a lower debt-to-income ratio (even if the income is investment income rather than a monthly paycheck). This makes it easier to borrow when you want or need to. You can also access your equity without selling, through a Home Equity Line of Credit, or HELOC.
There’s a special peace of mind that comes from knowing your home can’t be taken from you. As many have said, if you have a mortgage, your home is really the bank’s. If you doubt that, consider what would happen if you stopped making your mortgage payments. That’s right – you’d be out on the street in short order.

Michelle Petrowski CFP, CDFA, Founder of Being in Abundance gives great weight to that last point and adds another consideration, “Paying off a mortgage before retirement can create peace of mind. Many retirees sleep better knowing they own their home outright, especially if they’ve weathered job loss, market downturns, or other instability. Having fewer fixed expenses also means less pressure to sell investments in a down market early in retirement, which helps reduce sequence of returns risks.”

Russ Thornton, Founder of Wealthcare for Women agrees, “I always encourage near-retirees to pay down or pay off their mortgage if they can afford to do so without jeopardizing their cash flow or their retirement plan. The psychological benefit is significant based on feedback from many clients, and not having a mortgage will give them additional cash flow flexibility in retirement. If they can’t afford to pay it off before retirement, we’ll often look at taking a big bite out of their mortgage principal via a recast so they can lower their remaining payment amount.”

With all these clear advantages, who wouldn’t want to enter retirement mortgage-free?

Here’s where things stop being so simple…

Why Paying Off Your Mortgage Early Can Gut Your Retirement Finances

If only somebody would swoop in and gift you the hundreds of thousands of dollars needed to pay off your mortgage, but only if you used the money for that purpose…

Nice fantasy.

Reality, however, follows that well-known principle of finances – TANSTAAFL – “There Ain’t No Such Thing As A Free Lunch.”

In our case here, if you pay off your mortgage before retiring, that money must come from somewhere else in your personal finances picture, usually from your portfolio.

Therein lies the rub, paraphrasing Shakespeare’s Hamlet.

The First Trap – Opportunity Cost Reduces Your Income

If you withdraw money to pay off your mortgage, you reduce your monthly expenses, sure. But you also reduce the size of your portfolio. This is especially problematic if, like us, you’re sitting pretty with a 3-percent mortgage interest rate.

Almost any plausible investment should bring in more than a 3-percent return.

Even a high-yield savings account, per Nerdwallet, should bring in between 4 and 5 percent annual interest. And that’s a near-zero-risk asset, federally insured through the Federal Deposit Insurance Corporation (FDIC),

Depending on their maturity, these days, US Treasury bonds can bring in over 4 percent annual return.

In short, by paying off your mortgage early, you’d be leaving safe money on the table, reducing your portfolio income.

The Second Trap – Paying with Expensive Dollars

As long as you stay current on your mortgage, and assuming it’s a 30-year fixed loan like most mortgages, the lender will accept the same number of dollars monthly years down the road as they do now.

The thing is that the dollar keeps losing value each year.

Some years it’s just 2 percent a year, others it can be 10 percent or even more!

If you pay off your mortgage now, you’d be paying off that debt with the most expensive dollars you’ll ever own – today’s dollars, rather than paying with increasingly less valuable dollars each year. And the higher inflation burns, the less your mortgage payments are worth to the bank, and the less they cost you in purchasing power.

The Third Trap – Giving Up a Valuable Tax Deduction

One nice thing about mortgage payments is that (up to $750,000 balance), every dollar you pay in interest brings with it a tax benefit – you get to deduct 100 percent of your mortgage interest each year.

You could argue that in retirement, you’ll be in a lower tax bracket, so you may not even itemize. If so, the mortgage interest tax benefit disappears. However, as the years go by, you’ll be hit with the dreaded Required Minimum Distribution, or RMD. These mandated withdrawals start relatively small, but over the years, they increase dramatically, likely pushing you into ever higher tax brackets.

It’s then that having an interest deduction could matter again.

The Fourth Trap – Lost Liquidity

This one is a bit tricky.

When you pay off your mortgage, you’re pouring potentially hundreds of months’ worth of mortgage payments from a (at least mostly) liquid source in your portfolio into your home equity. That’s money that won’t be there for you if you have an emergency or an investment opportunity that’s too good to miss.

Sure, as mentioned above, a paid-off house can make borrowing easier. However, borrowing money to pay for an emergency is far more expensive than simply using savings.

The Fifth Trap – Giving Up Cheaply Leveraged Appreciation

According to data from Yale economist Robert Schiller, US residential property appreciates somewhere north of 5 percent, on average over the long term.

Imagine you currently owe several hundred thousand dollars on your mortgage, having paid in, say, 20 percent with your initial down payment plus another 10 percent gradually through your monthly payments to date.

If your house value increases by 5 percent, the entire 5 percent gain is yours. However, since you still owe more than twice as much as your equity, your return on investment, so to speak, is nearly 17 percent!

Even accounting for a 3 percent loan interest rate leaves you with an average annual return of more than 13 percent – higher even than the stock market’s long-term average annual return of about 10 percent.

The Sixth Trap – Portfolio Concentration

If you know what you’re doing (or have an investment manager who does), your portfolio is widely diversified such that you aren’t devastated by any single asset crashing.

Liquidate several hundred thousand dollars of that portfolio to pay off your mortgage, however, and you’ve essentially concentrated a large fraction of your net worth in a highly illiquid asset whose value should increase gradually over time but could lose a huge fraction of its value at any given specific time.

Just ask the good people of Nevada about the impact of the 2008 crash on their housing market. Homes there lost over 60 percent of their value!

Now imagine you have a sudden financial crunch, just when the stock market is down and your local housing market is depressed, so selling either financial assets or your home locks in huge losses.

The Seventh Trap – A False Sense of Security Leading You to Overspend

Let’s say you’ve done well and managed to completely pay off your mortgage before retiring.

That’s a huge win, right?

The sense of freedom and emotional peace you experience could make you more subject to financial temptations. After all, you may think you’re not going to lose your home, so why not treat yourself to uber-luxurious annual vacations?

Spend freely enough, and your financial plan can come all undone. Just ask your financial advisor. I’m sure he or she can share more than one story of a retiree feeling flush, overspending until they run out of money with many years of life remaining.

Who Should Pay Off Their Mortgages Before Retiring Despite All That?

No matter what a spreadsheet or personal finance app says, if you can’t stick with a plan because it feels too risky, you won’t.

And then things will start going badly.

So, if one or more of the following apply to you, consider paying off your mortgage as early as you can. Just keep those seven traps in mind and try to avoid them.

You hate being in any debt, no matter how strategically beneficial it might be, so the peace of mind from owning your home free and clear overrides any monetary benefits you may gain by keeping the mortgage going.
Having a monthly mortgage payment, even one that’s easily manageable with your investment income, makes you shy away from spending money you can afford to spend so that keeping your mortgage will cheat you out of a better retirement experience.
Your mortgage balance is relatively small, so you don’t need to cash in too many chips to pay it off.
Paying off the mortgage will still make a big difference in your monthly cash flow.
You value financial simplicity above almost all else.
Your retirement portfolio is somewhat limited, and living on 4 percent of it a year would be difficult. This is because research shows that your safe withdrawal rate increases when your fixed expenses decrease, even if your total spending remains the same, and even more so if it decreases. Thus, you’d have more wiggle room to reduce spending as needed when the market crashes.
The tax-deferred portion of your nest egg is relatively small, so you don’t expect RMDs to cause your taxes to increase significantly.
You don’t expect tax rates to increase significantly, expect them to drop, and/or expect the standard deduction to grow to the point that you won’t itemize deductions, making the mortgage interest tax deduction less valuable.
You expect inflation to be relatively flat (or even negative, i.e., deflation), so you expect the value of current dollars to be not much higher (or even lower) than the value of future dollars.

Kevin Newbert, CFP®, Private Wealth Advisor of Ausperity Private Wealth agrees with the financial benefits of keeping a low-interest mortgage, but recognizes the importance of the emotional aspects, “For clients who locked in historically low mortgage rates in 2020 or 2021, typically in the 2-3 percent range, the math often favors keeping the loan and investing excess capital instead, as the opportunity cost of prepaying can be significant.

“But numbers aren’t the whole story. For some risk-averse individuals, the peace of mind and simplicity that come with eliminating a monthly payment in retirement outweigh the potential gains from trying to outperform their mortgage rate in the markets.”

Like some of his colleagues, Brennan Decima, Owner, Decima Wealth Consulting also emphasizes the emotional benefits of paying off the loan, but adds a nuanced test regarding its feasibility, “A successful retirement is as much about peace of mind and certainty as it is about maximum return. We could all work until the day we die and know that we have zero chance of running out of money, but that doesn’t mean that’s what is best for us.

“For many of our clients, the confidence and joy they get from being mortgage-free outweighs the loss of potential growth of their nest egg from investing their money elsewhere. Sure, you might be able to make more elsewhere, but it’s not a guarantee. Getting out of a lingering outlay is a sure thing.

“As much as having no mortgage in retirement can create peace of mind, that peace of mind should not come at the expense of a successful retirement plan. Many of our clients ask if they should drain their IRA or 401(k) accounts to get rid of their mortgage. We tell them that if doing so would push them into a significantly higher tax bracket, they should avoid paying off the mortgage. This is why we suggest using after-tax dollars, and only if the remaining mortgage balance is less than 1/3 of those dollars. If paying off the loan forces you to give up too much flexibility, it may haunt you down the road.”

Who Should Think Twice (or Three Times) Before Paying Off Their Mortgages?

Personally, I think this group should include most people, and certainly most people whose situation is similar to mine. To make things more specific, let’s flip the previous list on its head. You should seriously reconsider paying off your mortgage early if several of the following are true for you.

You value financial flexibility and optimization over simplicity.
You’re comfortable with carrying debt if the interest is low enough to make it financially beneficial.
If you know your expenses, including the mortgage payment, are easily covered by your investment income, you’d be comfortable spending appropriately to your wealth level.
Your mortgage balance is relatively high, so paying it off at once would have a significant impact on the size of your nest egg, or, on the flip side, your nest egg is large enough that you can easily cover your expenses, including mortgage payments, while drawing much less than 4 percent annually.
The mortgage payments are not a significant part of your monthly cash flow.
You expect tax rates to increase significantly in the future, increasing the value of the mortgage interest tax deduction. You also don’t expect the standard deduction to be high enough in the future to the point that you’d no longer itemize deductions.
You expect inflation to run relatively hot during the remaining life of your mortgage, so the impact of those fixed monthly payments will decrease significantly.
The tax-deferred portion of your nest egg is large, so once they arrive, RMDs would increase your income taxes significantly and possibly increase your taxable income enough to push you into Medicare’s Income-Related Monthly Adjustment Amount (IRMAA) territory.
Also related to the fraction of your nest egg held in tax-deferred accounts, drawing hundreds of thousands of dollars from such accounts at once so you can pay off your mortgage will cause your taxable income in that year to spike, pushing you into the highest tax brackets.

Zack Gutches, Founder & Lead Financial Planner at True Riches Financial Planning agrees with the first point above, but emphasizes the importance of that last one, “While many pre-retirees want to enter retirement debt-free, it’s important to maintain adequate liquidity in your finances heading into retirement. Not having liquidity can reduce lifestyle flexibility in retirement, as well could accelerate withdrawals from tax-deferred retirement accounts, which often come with a 20-plus-percent hurdle via ordinary income taxes. Keeping even a 6-percent-interest mortgage begins to look very attractive when the alternative is accelerating 20-plus-percent taxes on the withdrawals required to retire the debt.”

What I Plan to Do with Our Mortgage

Now that we’ve walked through all the traps, costs, and benefits of the different options, I won’t keep you in suspense any longer.

My personal decision is to keep our 3-percent mortgage for as long as we can, most likely until we move to a smaller house. And if the real estate market is kind to us at that point, we may well be able to sell the house, pay off the mortgage, and have enough left over to buy our next place mortgage-free.

This way, we’d dramatically reduce our monthly expenses without draining any of our financial assets. The best of both worlds.

The Bottom Line

Contrary to conventional wisdom, not everyone should (strive to) pay off their mortgage before retiring.

Your decision needs to balance your nest egg size, its tax-related composition, cash flow, risk tolerance, thoughts on how tax rates and standard deduction size will change over time, inflation expectations, emotional comfort with (strategic, low-interest) debt, and more.

If mortgage payments squeeze your retirement income goals, paying off the mortgage might be right. But if you’re comfortable managing low-cost debt and want your money to work harder, keeping your mortgage will likely grow your nest egg more.

As Ryan Nelson, Founder of Alchemy Wealth Management, says, “Carrying a mortgage into retirement means committing to that fixed payment, which can feel restrictive, especially in years when investment returns are lower or even negative. If your mortgage has an adjustable interest rate, keeping it exposes you to interest rate risk. Another consideration is that changes in tax law could make the loan less advantageous over time.

“If a mortgage payment significantly strains your retirement cash flow, eliminating it can free up resources for living expenses and reduce financial stress. The peace of mind that comes from owning your home outright is hard to quantify, and for some retirees, that emotional benefit outweighs any potential investment gains from keeping the loan.

“However, keeping a mortgage, especially one with a low interest rate, preserves liquidity, which provides more flexibility for unexpected expenses or opportunities. You can also retain more investable assets and greater diversification, potentially earning returns above the loan’s cost (especially after-tax cost), allowing your portfolio to grow. allows you to. Finally, it lets you pay the debt down with future, less valuable dollars, especially if inflation runs high.

“Whether to pay off your mortgage before retirement isn’t purely a math problem. It’s a balance between financial efficiency and emotional comfort. The best plan is the one you can stick to through all market conditions.”

Next, remember that mortgage payments aren’t your only large home-related expense. Other major costs include:

Property taxes, especially in states like New Jersey, with its notoriously high tax rate.
Homeowners insurance, which can be especially expensive in jurisdictions with high risk of flooding and/or hurricane damage – in some places it’s become increasingly difficult to find affordable homeowners’ coverage, and you may be forced to get insurance from your state’s insurance of last resort – an expensive solution with sub-optimal coverage.
Maintenance and repairs, especially if you own an older home and/or one where big-ticket items loom large – think roof replacement, replacing your HVAC system, replacing major appliances, significant landscaping work, etc.

When considering all this, depending on your outlook, you might feel that keeping the mortgage payments is too much to handle or, conversely, that you may as well keep that mortgage.

Your mortgage is a tool, and like any tool, using it correctly makes life easier, while misusing it can cause you serious harm. If you’re comfortable using this tool and are confident you’d use it wisely, keeping your mortgage is likely the savvier way to go.

Finally, keep in mind that the best plan isn’t necessarily the one that offers you the best financial outcome. Rather, it’s the one you can stick with, not just financially, but also emotionally. Otherwise, you’ll never see the plan’s expected benefits but may well be stuck with its drawbacks.

Disclaimer: This article is intended for informational purposes only, and should not be considered financial advice. You should consult a financial professional before making any major financial decisions.

About the Author

Opher Ganel, Ph.D.

My career has had many unpredictable twists and turns. A MSc in theoretical physics, PhD in experimental high-energy physics, postdoc in particle detector R&D, research position in experimental cosmic-ray physics (including a couple of visits to Antarctica), a brief stint at a small engineering services company supporting NASA, followed by starting my own small consulting practice supporting NASA projects and programs. Along the way, I started other micro businesses and helped my wife start and grow her own Marriage and Family Therapy practice. Now, I use all these experiences to also offer financial strategy services to help independent professionals achieve their personal and business finance goals. Connect with me on my own site: OpherGanel.com and/or follow my Medium publication: medium.com/financial-strategy/.

Learn More About Opher

When searching for a financial advisor, you’ll likely encounter professionals who proudly display various awards, designations, and recognitions. While these accolades can provide valuable insights into an advisor’s expertise and standing within the industry, it’s important to understand what each award actually means and how much weight to give them in your decision-making process.

The Role of Awards When Evaluating Financial Advisors

Financial advisor awards can serve as useful screening tools, helping you identify professionals who have demonstrated expertise, gained recognition for their high ethical standards, or delivered exceptional service. However, not all awards are created equal, and it’s useful to understand what different recognition programs actually measure.

The criteria for many traditional award programs focus heavily on assets under management (AUM) and revenue generation, implying that a firm’s size or rapid growth warrants recognition, rather than celebrating advisors whose clients routinely express their gratitude for a job well done. While managing large assets can indicate experience, it doesn’t necessarily translate to better communication, more personalized service, or superior outcomes.

Think of awards as one piece of the puzzle rather than the complete picture in your search for an advisor, and consider giving greater weight to award programs that emphasize verified client feedback and service quality over pure asset size. These client-focused awards provide more relevant insights into what your actual experience with an advisor might be like.

Top Financial Advisor Award Programs

Before diving into specific awards, it’s important to distinguish between professional designations and recognition awards. Professional designations like CFP (Certified Financial Planner) or CFA (Chartered Financial Analyst) require extensive education, testing, and ongoing continuing education. Recognition awards, on the other hand, are typically earned based on performance metrics, peer nominations, client feedback, or industry achievements.

Forbes Best-In-State Wealth Advisors

This annual list published by Forbes recognizes top-performing advisors in each state based on assets under management, revenue generated for their firms, and regulatory records. Forbes partners with SHOOK Research to compile these lists using quantitative and qualitative measures.

Barron’s Top Advisor Rankings

Barron’s publishes several advisor rankings, including their “Top 1,200 Financial Advisors” and state-specific lists. Their methodology focuses heavily on assets under management, revenue production, and quality of the advisor’s practice, with additional consideration for regulatory records and client retention.

Wealthtender Voice of the Client Awards

The Wealthtender Voice of the Client Awards focus specifically on client experience and satisfaction, recognizing financial advisors who demonstrate exceptional client service, communication, and relationship management. Award recipients are selected based on verified client feedback, testimonials, and demonstrated commitment to putting clients first.

Investopedia 100 Top Financial Advisors

This annual list published by Investopedia recognizes financial advisors based on a combination of factors including assets under management, years of experience, regulatory records, and client feedback. Investopedia’s methodology aims to identify advisors who serve clients across various wealth levels.

USA Today Top Financial Advisory Firms

These rankings published by USA Today recognize both individual advisors and advisory firms based on comprehensive evaluation criteria including client service, fee transparency, regulatory compliance, and overall client outcomes rather than just asset size.

Comparing Financial Advisor Awards

Award Program	Primary Criteria	Frequency	Geographic Scope	Key Strengths	Limitations	More Info
Forbes Best-In-State	AUM, revenue, regulatory record	Annual	State-by-State	Rigorous vetting process, considers regulatory history	Heavily weighted toward large practices, may not reflect client service quality	Forbes Advisor Rankings
Barron’s Top Advisors	AUM, revenue, practice quality	Annual	National & State	Comprehensive methodology, industry respect	Favors high-asset advisors, limited client experience focus	Barron’s Rankings
Wealthtender Voice of the Client	Verified client reviews, satisfaction, communication	Annual	National	Client-centric focus, verified feedback, relationship quality emphasis	Advisors must collect client reviews and provide transparent disclosures to qualify	Wealthtender Voice of the Client Awards™
Investopedia Top 100	AUM, experience, compliance, client feedback	Annual	National	Balanced approach across wealth levels, includes client input	Still emphasizes asset size as primary factor	Investopedia Rankings
USA Today Top Firms	Client service, fee transparency, compliance, outcomes	Annual	National	Emphasizes client service and transparency over asset size	Firm-focused rather than individual advisor recognition	USA Today Rankings

What Each Award Really Tells You

Asset-Based Rankings (Forbes, Barron’s): These awards heavily favor advisors who work with high-net-worth clients and manage substantial assets. While large asset bases can indicate experience and success, they don’t necessarily correlate with better client service, communication skills, or outcomes for average investors. An advisor managing $500 million for wealthy clients may not be better suited for a middle-class family than an advisor managing $50 million across diverse client types. These rankings essentially measure business size rather than client satisfaction or service quality.

Client-Focused Awards (Wealthtender, USA Today): Programs that emphasize verified client reviews, satisfaction scores, and service quality provide more relevant insights for most consumers. The Wealthtender Voice of the Client Awards, in particular, base their recognition on actual client feedback and verified reviews, giving you a clearer picture of what it’s actually like to work with these advisors. These awards focus on the factors that matter most to your experience: communication, responsiveness, and results.

Balanced Approaches (Investopedia): Some programs attempt to balance asset size with other factors like client feedback and regulatory records. While these can provide a more comprehensive view, it’s important to understand what weight is given to each factor in their methodology.

Red Flags to Consider

While legitimate awards can be helpful in your evaluation of a financial advisor, be cautious of:

Pay-to-play awards where advisors pay fees to be considered or featured
Vague criteria or awards that don’t clearly explain their selection methodology
Self-proclaimed titles like “Top Advisor in [City]” without third-party verification
Outdated recognition where advisors prominently display awards from many years ago
Excessive award claims where an advisor lists dozens of awards, some of which may be questionable

How to Use Award Information Effectively

Prioritize Client-Focused Recognition: We might be biased, but when evaluating awards, we encourage you to give greater weight to programs like the Wealthtender Voice of the Client Awards that base recognition on verified client reviews and actual service experiences. These provide more relevant insights into communication quality, responsiveness, and client satisfaction than asset-based rankings.

During Your Search: Look for advisors who have received recognition from programs with transparent, client-centric methodologies rather than just asset-based metrics.

During Interviews: Ask advisors to explain the awards they’ve received and what criteria were used. Pay particular attention to any recognition based on client feedback or service quality. A confident, client-focused advisor should be able to clearly explain how they measure and maintain client satisfaction.

Verification: Don’t just take an advisor’s word for their awards. Verify recognition through the awarding organization’s website or published lists. For client-focused awards, ask to see examples of client testimonials or reviews (while respecting privacy).

Questions to Ask About Awards

When meeting with potential advisors, consider asking:

Can you explain what this award recognizes and how recipients are selected?
What year did you receive this recognition?
How does this award relate to the services I’m seeking?
What other qualifications and experience do you have beyond this recognition?

Should Financial Advisor Awards Factor Into Your Hiring Decision?

Awards and recognition can be valuable tools in your financial advisor selection process, but prioritize programs that emphasize verified client feedback and service quality over those that primarily measure asset size or revenue generation. Client-focused recognition like Wealthtender’s Voice of the Client Awards provide more relevant insights into what your actual experience with an advisor will be like.

The most important factors in choosing a financial advisor remain their qualifications, experience, client reviews, communication style, fee structure, and how well they understand your specific financial needs and goals. A great financial advisor for you might not appear on asset-based rankings but could be highly rated by actual clients for their communication, responsiveness, and results. Focus on finding someone who demonstrates expertise, maintains high ethical standards, communicates clearly, and whose recognition comes from satisfied clients rather than just metrics based on the size of their firm.

Remember that your relationship with a financial advisor is deeply personal and has the potential to last decades. While client-focused awards can help you identify candidates who prioritize service quality, the right advisor for you is ultimately the one who earns your trust, communicates in a way that makes sense to you, and helps you achieve your financial goals regardless of how much assets they manage for other clients.

About the Author

Brian Thorp

Brian is CEO and founder of Wealthtender and Editor-in-Chief. He and his wife live in Austin, Texas. With over 25 years in the financial services industry, Brian is applying his experience and passion at Wealthtender to help more people enjoy life with less money stress. Learn More about Brian

A man with a shaved head in a blue suit, white shirt, and patterned red tie, smiling at the camera. The background is softly blurred with neutral tones and a window. — Dan Sondhelm CEO of Sondhelm Partners | Image Credit: Institute for Innovation Development

[Client expectations for financial services are rapidly evolving and forcing advisors to rethink their traditional business models and become more strategic in their outreach and messaging. Multiple studies and surveys, like these from BNY Pershing and WealthManagement IQ, have uncovered how High-Net-Worth clients are looking for more personalization, comprehensive and integrated financial planning, tailored multi-generational advice, and help in solving their specific family and business wealth challenges. This is manifesting as a huge disconnect, causing friction, and a lack of advisor marketing effectiveness that continues to overestimate wealthy client interest in their core investment management services.

To explore this advisor engagement and growth challenge, I sat down with financial services marketing expert Dan Sondhelm CEO of Sondhelm Partners to discuss why many RIAs and financial advisors struggle to grow despite having strong investment performance and sophisticated technology. Dan shares his extensive industry experience and discussions with a wide cross-section of asset managers and wealth managers on their challenges in connecting to wealthy clients through their current marketing and messaging efforts. He also offers insightful observations and strategic suggestions that can refocus their efforts for greater success.]

Hortz: Dan, everyone talks about financial advisors needing better digital tools to compete. Do you think that is missing the point?

Sondhelm: It is not that digital does not matter, but it should come second. I see RIAs spending huge amounts of money on new platforms, apps, email marketing systems, and social media campaigns while their core positioning is completely misaligned with what their prospects actually need. You can have the slickest website in the world, but if you are positioning yourself as a stock picker to HNW prospects who need comprehensive wealth solutions, you are solving the wrong problem.

The issue is that many RIAs position themselves around their investment strategy when they are trying to attract high-net-worth clients. They will say something like “We specialize in mid-cap value investing” or “We run a concentrated growth portfolio.” But wealthy prospects do not wake up thinking they need a portfolio manager. They wake up worried about estate planning, tax optimization when they sell their business, or how to transition wealth to the next generation.

I see this constantly. I will look at a RIA’s website and it says, “We help successful individuals achieve their financial goals through disciplined investment management and rigorous security selection.” That could be any investment manager. But if you are trying to attract business owners or executives with complex wealth situations, they need to know you understand their world beyond stock picking.

Digital tools should amplify whatever positioning you have. If your positioning is misaligned, better technology just helps you communicate that misaligned message more efficiently. But when your positioning matches what prospects actually need, digital tools help you reach more of them and build credibility before you ever meet.

Hortz: Can you give me a concrete example of this misalignment?

Sondhelm: Sure. I worked with an RIA that kept talking about their “disciplined value approach with a focus on quality companies trading below intrinsic value.” They had the investment chops, good performance, but they were getting nowhere with HNW prospects. These prospects had businesses to sell, estate planning concerns, tax issues. The RIA was solving investment problems, but the prospects had wealth problems.

We repositioned them from “We help successful investors build wealth through disciplined value investing” to “We help business owners who’ve built their wealth in one company spread their risk and plan for what comes next.” Same investment capabilities, but now they are addressing the real concerns keeping these prospects up at night.

The positioning confusion is getting worse across the industry. I see RIAs with CFPs on staff still positioning themselves purely as investment managers. Their homepage talks about “portfolio optimization” and “security selection” when they should be talking about “protecting your family’s future” and “navigating complex wealth transitions.” They have the capability to be holistic, but they are not positioning themselves that way.

Then I see other RIAs who recognize this gap and start hiring CFPs or partnering with estate attorneys so they can legitimately position themselves as comprehensive wealth managers. That is smart positioning for the HNW market, but they do not always change their story to match their new capabilities.

Hortz: When does investment-focused positioning actually make sense?

Sondhelm: If you are purely an investment manager, lead with your investment approach. Some RIAs only do stock picking and portfolio management. For them, “We run a concentrated mid-cap value strategy” makes perfect sense. They are not trying to do estate planning or tax work. They know their lane and they stay in it.

The positioning gets more complex when you serve multiple audiences. If you work with both institutional clients and HNW individuals, you need different positioning for different situations. Lead with your investment strategy when talking to institutional clients, pension consultants, or other advisors looking for sub-advisory relationships. They are shopping for exactly that investment expertise.

But when you are talking to HNW prospects, lead with comprehensive wealth solutions. Even if they eventually want to discuss your stock-picking approach, let that come up naturally in the conversation after you have established that you understand their broader wealth challenges. Do not assume they care about your investment methodology upfront.

Here is where it gets tricky. Many RIAs think they are investment managers when they are actually competing for comprehensive wealth management relationships. If you are trying to attract business owners or executives with $2 million plus, you are not competing against other stock pickers. You are competing against full-service wealth managers who can handle their entire financial life.

I had a client who would start every HNW prospect meeting by pulling out performance charts going back ten years. He would spend twenty minutes walking through his investment methodology. Meanwhile, the executive across the table is thinking about equity compensation timing, succession planning, and protecting family wealth. The advisor never addressed any of that because he was too busy proving his analytical skills.

The prospects would say things like “This is interesting, but I think I need someone who can help with more than just investments.” They were right. He was positioning himself as a solution to a problem they did not have while ignoring the problems they actually did have.

Hortz: What is the role of specialization in fixing this positioning problem?

Sondhelm: Having a clear specialty is essential, but the key is picking one based on actual client patterns rather than what you think sounds good. I tell RIAs to look at their best clients and find the common threads. What industries do they work in? What life transitions have they gone through? What problems do you solve best?

One client told me he realized his niche when he noticed four of his best relationships were all business owners who had gone through acquisitions. That was not an accident. He understood their world because he had lived through it with them. Another advisor discovered she had a natural affinity for working with women going through divorce. She understood the financial complexity and emotional aspects in ways that resonated.

The mistake most RIAs make is picking a niche based on demographics rather than problems. “We work with high-net-worth individuals” is not a niche. “We help tech executives navigate pre-IPO equity decisions” is a niche. One focuses on who has money, the other focuses on who has specific challenges you can solve.

Your niche has to be authentic though. If you have never worked with business owners and do not understand their wealth challenges, do not suddenly claim that is your specialty. But if you have three clients who have gone through similar transitions and you have helped them succeed, lean into that expertise.

Hortz: Once an RIA figures out their positioning, how do they communicate it effectively?

Sondhelm: You need to get your positioning into the market through multiple channels, and it needs to be consistent everywhere. Most RIAs either have unclear positioning, or they only communicate it in face-to-face meetings. That limits their growth to however many people they can personally meet.

Content marketing, speaking opportunities, getting quoted in the media, website content, email campaigns, social media. If your positioning is about helping business owners navigate wealth transitions, that theme should run through everything you publish. Your investment expertise might be part of your toolkit, but it should not be your headline.

For example, instead of writing an article called “Mid-Cap Value Opportunities in the Current Market,” write “How to Time Your RSU Sales to Minimize Tax Impact.” A tech executive who reads that article immediately understands you get his world beyond just investment management.

I see RIAs write LinkedIn posts about interest rate movement when they should be writing about succession planning or liquidity strategies. They will speak at conferences about portfolio construction when their target clients want to hear about comprehensive wealth transitions. The content has to reinforce your positioning, not just showcase your investment knowledge.

The biggest obstacle when RIAs try to change their positioning is getting everyone at the firm aligned. You will have the senior advisor talking about comprehensive wealth planning while junior staff are still asking prospects about risk tolerance and investment objectives. I worked with an RIA where the lead advisor repositioned around business owner wealth transitions, but when prospects called, the first question from staff was “What’s your current asset allocation?” Mixed messages kill conversions.

Hortz: How do you know if your positioning is actually working?

Sondhelm: The quality of your conversations changes first, then the quality of your prospects. You will notice people asking different questions. Instead of price shopping, they are asking about your experience with their specific situation. “Have you worked with other executives going through acquisitions?” rather than “What’s your management fee?”

Referrals become more targeted too. When existing clients can clearly explain who you work with and what problems you solve, they make better referrals. Instead of referring you as “a good financial advisor,” they refer you as “the advisor who helps business owners with liquidity events.” That is a warm introduction to exactly the right prospect.

The timeline varies, but expect six to twelve months for real momentum if you are making significant changes. You are not just updating marketing materials; you are changing market perception. That takes consistent messaging across multiple touchpoints over time.

One metric I track with clients is what I call “qualification rate” – how many initial prospect conversations turn into second meetings. When your positioning is clear and matches what prospects need, more people want to continue the conversation. If you are getting lots of first meetings but few second ones, your positioning probably is not connecting with their real needs. There could be other things too, like lousy meeting skills, but that is another article.

HNW prospects are also increasingly skeptical of generic pitches. Your positioning has to feel authentic. They can tell when you are just saying what you think they want to hear versus when you actually understand their situation from experience.

Hortz: What is the biggest shift you think RIAs need to make?

Sondhelm: They need to understand what business they are really in. Many RIAs think they are investment managers when they are actually in the business of solving complex wealth problems for successful people. That requires completely different skills, different conversations, and different value propositions.

The most successful RIAs I know spend more time understanding their clients’ business, family situations, and life goals than they do analyzing securities. They are asking questions like “What happens to your employees when you sell?” and “How do you want your kids to think about money?” rather than “What’s your risk tolerance?”

This shift affects everything – who you hire, what you talk about in meetings, how you price your services, even your office setup. One client realized he needed to hire a CFP and an estate attorney rather than another research analyst. Another started holding client meetings in conference rooms instead of in front of Bloomberg screens.

The industry is moving toward more comprehensive relationships anyway. Clients have access to low-cost investment options everywhere. What they cannot get everywhere is someone who understands their complete financial life and can coordinate all the moving pieces. That is where the value is, and that is where the growth opportunities are.

RIAs who make this shift successfully often find they can charge higher fees because they are delivering more comprehensive value. You are not competing on investment performance anymore. You are competing on your ability to solve complex problems most other advisors cannot handle.

Hortz: Any final thoughts for RIAs struggling to grow?

Sondhelm: The RIAs that grow consistently are not necessarily the ones with the best investment performance. They are the ones whose positioning matches what their target market actually needs. When a prospect meets with you and thinks “This person understands the wealth challenges I’m facing,” you have already won.

Focus on becoming the advisor who solves the right problems for the right people. Investment capabilities, digital tools, all of that should support your positioning, not define it. And remember, your positioning is not about what you are good at. It is about what your target clients actually need.

I will leave you with this. The best RIAs I know can explain who they serve and what problems they solve in one sentence that makes perfect sense to their target client. “I help tech executives turn their equity compensation into diversified wealth.” “I help business owners navigate the financial complexity of selling their companies.” “I help physicians build and protect wealth while managing practice liability.” If you cannot do that, your positioning is not clear yet. But once you can, everything else gets easier.

This article was originally published here and is republished on Wealthtender with permission.

About the Author

Bill Hortz

Founder Institute for Innovation Development

Bill Hortz is an independent business consultant and Founder/Dean of the Institute for Innovation Development- a financial services business innovation platform and network. With over 30 years of experience in the financial services industry including expertise in sales/marketing/branding of asset management firms, as well as, creatively restructuring and developing internal/external sales and strategic account departments for 5 major financial firms, including OppenheimerFunds, Neuberger&Berman and Templeton Funds Distributors. His wide ranging experiences have led Bill to a strong belief, passion and advocation for strategic thinking, innovation creation and strategic account management as the nexus of business skills needed to address a business environment challenged by an accelerating rate of change.

Find financial advisors in Eugene, Oregon ready to help with your financial planning needs so you can enjoy life more with less money stress.

Whether you have lived in Eugene for years or recently moved to town, you may need help finding the right financial advisor in the community best suited for your individual needs.

It’s important to first consider your own financial planning priorities before choosing an advisor. Here are a few quick tips to help you get started along with financial advisors in Eugene featured on Wealthtender you may want to add to your shortlist.

Featured Eugene Financial Advisors

As you prepare to interview financial advisors in Eugene who may be right for you, get to know local financial advisors featured on Wealthtender.

📍 Map: Financial Advisors with their Primary Office Location in Eugene

Double-click (or pinch the map on mobile devices) to zoom in and expand the details for financial advisors whose primary office location is in Eugene.

📍Double-click or pinch pins to view more.

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Looking for a Financial Advisor in Eugene, Oregon?

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The Benefits of Hiring a Financial Advisor in Eugene

Hiring a financial advisor can be a great move to help you build a long-term investing strategy. Advisors can help you build an investment portfolio to meet your financial goals and help you plan appropriately for retirement.

As a resident living in Eugene, hiring a financial advisor who lives nearby and understands the local economy, cost of living, and regional employers can be quite valuable, especially if your individual circumstances are deeply tied to such factors.

Do you work for one of the largest employers in Eugene? If so, there’s a good chance the local financial advisor you hire will also have other clients who work there. This knowledge could prove valuable if they are already familiar with your employee benefits, such as a 401(k) plan, Health Savings Accounts, and other components of your total compensation package.

When you reach out to financial advisors you’re considering hiring, let them know where you work and ask if they are familiar with your employer’s unique benefits and compensation structure.

Quick Tips For Hiring an Eugene Financial Advisor

Before hiring a financial advisor in Eugene, here are a few quick tips to help you find the best advisor for you.

1. Decide Which Services You Need

Before hiring an advisor, determine what services you need from them. Whether it’s full-service investment management or a plan focused on a specific area of your finances, put together a list of what you’d like help with before contacting an advisor.

Though most people use a financial planner simply to invest for retirement, this is only a small part of what many advisors offer. Here’s a quick rundown of potential services a financial advisor may offer you:

Budgeting and money management
Debt management
Insurance planning
Retirement planning
Other investment planning
Inheritance planning
Estate planning
Tax planning

As you can see, financial advisors can help you with your entire financial picture, not just investing. As you start to plan for life’s bigger milestones, you should consider finding a financial advisor that specializes in those areas.

Finding the right advisor can help you minimize risk, maximize gains and take advantage of tax breaks while investing for your future. They can also help you protect your assets with the right kinds of insurance and help you pass on your financial legacy with a proper estate plan.

2. Consider Your Budget and Payment Preferences

Once you have a list of services you would like, review the fee structures financial advisors offer. Finding a balance between the services you need and the cost of those services will help narrow down the field of advisors you may want to work with.

If you are looking for a full-service advisor to manage all of your investments, consider searching among fee-based financial advisors. If you want to manage your money yourself, consider the flat fee and monthly subscription advisors for ongoing support.

3. Interview Multiple Financial Advisors

Once you have chosen the services and fee structure you prefer, it’s time to contact a few advisors and interview them. Here are questions to ask financial advisors:

What services do you provide?
What are all the ways you get paid? (fee transparency)
What is your investment strategy?
How do you measure investment performance?
How do we communicate about my plan?

Interview multiple advisors to get a feel for who you want to work with. A combination of fees, services, and customer service will help you determine the best fit for your financial advice.

4. Review Financial Advisor Credentials

Once you find an advisor (or two) you feel comfortable with, it’s always a good practice to check their credentials and the firm’s details. You can do this at the Investment Adviser Public Disclosure (IAPD) website.

You can check both the individual and the firm to view their background and experience details, as well as any disciplinary action taken against them or their firm.

As licensed financial professionals, there is oversight into how financial advisors conduct business, so running a quick (free) check on them is recommended.

For additional information about advisor credentials, read our article to learn the most popular designations held by financial advisors, as well as specialized credentials which may be important to consider if you have unique financial planning needs.

Frequently Asked Questions & Additional Resources

How do I know if I’m ready to hire a financial advisor?

You should strongly consider hiring a financial advisor if you have a significant amount of money available for saving or investing. This could occur after years of making annual contributions to a retirement plan like a 401(k) through your employer or suddenly if you receive a large inheritance or sell your house for a large profit.

But even if you don’t have a lot of money saved, many financial advisors and planners provide reasonable pricing options and valuable services you should consider, especially if you’re facing a significant life event. For example, if you’re starting a new job, getting married, starting a family, getting divorced, lost your job, starting or selling a business, or approaching retirement age, working with a trusted financial advisor or planner may prove worthwhile.

Before I hire a new financial advisor, should I fire my current advisor?

You don’t need to fire your current advisor before beginning your search for a new financial advisor. In fact, your new advisor can help coordinate the transition of your assets from your previous financial advisor.

Where can I read reviews about financial advisors written by their clients to help me decide if I should hire them?

After 60 years of regulatory prohibition of financial advisor reviews in the US, a rule issued by the Securities and Exchange Commission (SEC) became effective on May 4, 2021 that means both financial advisors and directory websites that help consumers search for a financial advisor can collect and display financial advisor reviews, an important factor worth considering when choosing who you’ll hire to manage your investments and life savings.

Wealthtender is the first independent advisor review platform designed to be fully compliant with the new SEC rule, and we look forward to helping you evaluate financial advisors based on reviews written by their clients.

I’m a local financial advisor interested in being featured in this guide. How do I get started?

Thanks for your interest. We look forward to learning more about your practice and helping you attract your ideal clients where you may be a good fit based on their individual needs and circumstances. Please click here to learn how you can join local financial advisors featured on Wealthtender.

How Much Does a Financial Advisor Cost?

➡️ How Much Does a Financial Advisor Cost? Read the Article

About the Author

Brian Thorp

Brian is CEO and founder of Wealthtender and Editor-in-Chief. He and his wife live in Austin, Texas. With over 25 years in the financial services industry, Brian is applying his experience and passion at Wealthtender to help more people enjoy life with less money stress. Learn More about Brian

Financial Professionals

Individuals

Step 1: Understand the Categories of Tax Forms

1. General Reporting Forms

2. Stock Compensation Tax Reporting Forms

3. Tax Return Filing Forms

Step 2: Gather the Necessary Forms

From Your Employer

From Your Broker

From Plan Administrators

Step 3: Step-by-Step Reporting

1. Reporting Wages and Compensation (Form W-2)

2. Reporting Stock Sales (Forms 1099-B, 3921, and 3922)

3. Completing Capital Gains and Losses (Schedule D and Form 8949)

4. Checking for Alternative Minimum Tax (Form 6251)

Step 4: Tips for Avoiding Common Mistakes

Double-Check Cost Basis Details

Track Your Holding Periods

Don’t Neglect Alternative Minimum Tax Calculations

Step 5: Consult a Professional

Final Thoughts on Tax Reporting for Stock Compensation

Resources for Tax Reporting for Stock Compensation

About the Author

What Would a Financial Advisor Help With?

Finding a Financial Advisor Will Keep Getting Harder

What Are the Main Causes of the Shortage?

Why You Should Care (or at Least Why I Care)

What You Can Do Now (It’s What I’m Doing)

The Bottom Line

About the Author

Get the Most Value from Your AT&T Benefits and Compensation Package

💸 Smart Money Insights for AT&T Employees & Executives

Q&A: Financial Planning Tips for AT&T Employees & Executives

Answers to AT&T Employee Questions with Ryan Nelson

Get to Know Ryan Nelson, Financial Advisor for AT&T Employees:

🙋‍♀️ Have Questions About Your AT&T Benefits or Career?

📰 Browse Related Articles

Are you ready to enjoy life more with less money stress?

Brian Thorp

Get the Most Value from Your Providence Benefits and Compensation Package

💸 Smart Money Insights for Providence Employees & Executives

Q&A: Financial Planning Tips for Providence Employees & Executives

Answers to Providence Employee Questions with Noah Schwab, CFP®

Get to Know Noah Schwab Financial Advisor for Providence Employees:

🙋‍♀️ Have Questions About Your Providence Benefits or Career?

📰 Browse Related Articles

Are you ready to enjoy life more with less money stress?

Brian Thorp

What Are Alternative Investments, and Why Now?

Types of Alternatives That Can Support Your Long-Term Goals

Know the Tradeoffs: What to Consider Before You Invest

Aligning Your Portfolio with Purpose

Have a Question to Ask a Financial Advisor?

About the Author

Retiring Mortgage-Free: The Conventional Mindset

Why Paying Off Your Mortgage Early Can Gut Your Retirement Finances

The First Trap – Opportunity Cost Reduces Your Income

The Second Trap – Paying with Expensive Dollars

The Third Trap – Giving Up a Valuable Tax Deduction

The Fourth Trap – Lost Liquidity

The Fifth Trap – Giving Up Cheaply Leveraged Appreciation

The Sixth Trap – Portfolio Concentration

The Seventh Trap – A False Sense of Security Leading You to Overspend

Who Should Pay Off Their Mortgages Before Retiring Despite All That?

Who Should Think Twice (or Three Times) Before Paying Off Their Mortgages?

What I Plan to Do with Our Mortgage

The Bottom Line

About the Author

The Role of Awards When Evaluating Financial Advisors

Top Financial Advisor Award Programs

Forbes Best-In-State Wealth Advisors

Barron’s Top Advisor Rankings

Wealthtender Voice of the Client Awards

Investopedia 100 Top Financial Advisors

USA Today Top Financial Advisory Firms

Comparing Financial Advisor Awards

What Each Award Really Tells You

Red Flags to Consider

How to Use Award Information Effectively

Questions to Ask About Awards