Case Study: Corporate Executive


As a devoted professional engineer, John Smith spent thirty years of his working career with a publicly traded global oil and gas exploration and production company and served in numerous leadership and management positions within the organization over the years.

Prior to his retirement five years ago, approximately seventy percent of the family’s financial wealth was heavily concentrated in the company stock, including stock options, restricted stock grants and outright shares. John also had significant assets in qualified and non-qualified retirement plans.

To help them prepare for retirement, Kanaly Trust developed a comprehensive financial counseling program to help them identify and develop their financial goals, evaluate and inform them of the available alternatives and, most importantly, implement financial action steps. We continue to monitor, evaluate and revise the financial plan as their needs and current law make it necessary.

The Plan

We developed a plan and continue to monitor each stock option grant against specific economic models to make recommendations on when to exercise the options and via which strategy (stock-for-stock or cashless exchange). We developed a program to gradually diversify John’s holdings at specified price targets, ever mindful of his insider position and filing requirements. We also evaluated the appropriateness of making special tax elections regarding restricted stock grants for maximizing the long-term after-tax benefits.

We were able to listen to their goals of charitable gifting and maximize the benefit through outright gifts of highly appreciated company stock and through other charitable strategies that can continue the philanthropic traditions of the family.

We performed a retirement plan distribution analysis in conjunction with a cash flow analysis for illustrating possible economic impacts of the distribution election prior to his retirement.

The Result

As part of the wealth management services, we met with John and his wife to discuss specific estate planning ideas regarding their wills, trusts and ancillary planning documents. We worked with their estate planning attorney to formulate a plan to protect their estate from taxation and eventually achieve their goals in transferring family wealth to the next generations. The wealth management services provided to John and Mary allowed Kanaly Trust to serve as the financial quarterback of the family throughout the planning process in addressing their needs in investment, insurance, tax, retirement and estate planning.



Name: John (65) and Mary (64)

Occupation: Retired Engineer

Net Worth: $8 million

Children: Adam (28) and Susan (34)