Addressing Financial Friction and the External Pressures and Expectations of Your Managers.


One of my favorite niches to work in is the transportation industry. Due to my many years of experience as an executive for UPS, I have in-depth knowledge of the struggles high-level employees in this field experience. Not only do high-level executives suffer from a lack of time, but they also experience a lot of pressure and often find their financial lives are a confusing mess. Here are some tips to help busy executives get their finances (and lives) structured and working for them.


Addressing Financial Friction

Many high-level executives—even if they’ve worked for the same company for the majority of their working lives, often have stuff everywhere and aren’t sure what to do with it. They may have even lost track of where some of their assets are located. This is the result of putting different financial and insurance plans into place and having numerous piles of money or assets that aren’t properly managed. Some of the execs I’ve worked with have two, three, or more financial professionals helping them (or who have helped them in the past), none of whom are working together or are even aware the others exist.

When execs have financial friction, they not only experience a lot of stress, but they also run the risk of incurring excess costs, paying extra taxes, and putting their portfolio at risk. This is a confusing financial position to be in and not conducive to their financial future.

The best thing to do in this situation is to settle on a single financial professional who can get everything into order. The right professional will get all your stuff in one place, help you fire any other planners or other professionals you no longer need and give you peace of mind.


Coping with External Pressures and Expectations

Every high-level executive has heard the term “golden handcuffs”. These are plans meant to incentivize execs to stay with the company by giving them compensation plans such as stock options, insurance policies, supplemental executive retirement plans, and deferred compensation plans. While these plans can be lucrative, they can also put a lot of pressure on the executives and cause them to make poor financial decisions.

The first issue with these types of situations is that they often lead to a concentration in risk. If the bulk of an executive’s financial future is based on stock options or other plans that are tied to the success and stability of the company they work for, they could easily lose it all should the company get in trouble or go under. They will also start to believe they have no other option but to stay with the company for the rest of their working lives, even if they are miserable.

As with the financial friction issue, the best solution in a situation like this is to work with an experienced and professional financial professional. Your financial planner can give you an outsider’s take on the situation, look at your plans and projections for the future, and help you make smart decisions. He or she can also help you unwind your financial future from that of the company’s—whether that means staying with the company until you retire or starting to look for other employment opportunities without the fear of losing your entire retirement.

As I said at the beginning of this article, I’ve been in the position of a top-level exec and I know some of these topics are very emotionally charged. However, sticking your head in the sand and hoping everything will turn out okay is simply not a viable plan of action if you want to ensure your financial future.

Are you ready to work with a financial planner who’s been in your shoes and knows what it takes to help you make the right decisions? Reach out. I’d love to talk more.