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119 - What Should I Do When I Have Large Unrealized Gains in a Concentrated Stock Holding?
Description
Scott and James discuss what you should do when you have large unrealized gains in a concentrated stock holding.
Listener Question
1. My wife and I have been blessed with good fortune through our ESPP and RSU programs across 4 different employers. Having always been a buy-and-hold investor, these companies now have significant unrealized capital gains and represent almost 50% of portfolio value and a strong dividend cash flow that could provide income during a job loss. We live in CA and are in top tax brackets and would like to effectively diversify without loosing over 50% to taxes.
2. I currently have around 4,500 shares of AAPL. This makes up about 54% of my total stocks. I have 2,200 shares in my investment (non-retirement) account which makes up 100% of this total. I want to reallocate some of the AAPL, but it will have serious tax implications especially with my investment account. What do you recommend?
Planning Points Discussed
- Retirement Planning
- Utilizing Time Efficiently
- Capital Appreciation
- Purchasing Power
- Other issues (IRAs, Inflation, Financial Goals, etc.)
Timestamps:
1:30 - Introduction
3:27 - First Listener Question
5:05 - Individual Stock Example
6:58 - Investing v. Gambling
9:05- Taxes
9:43 - Cost Basis
12:15 - Stock Option Tax Planning
14:22 - Peace of Mind & Tax Strategy
17:55 - Lowest Cost Basis v. Highest Cost Basis
19:00 - Charitable Giving Strategy
21:55 - Second Listener Question
23:00 - Retirement Account Tax Benefits
24:53 - Aligning Your Financial Goals
LET'S CONNECT!
James
Scott
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