Off topic – stock options

[Daniel]

Sorry, I see Ray pretty much covered it all. Ray, you type damn fast 🙂

[Daniel]

Sorry, I see Ray pretty much covered it all. Ray, you type damn fast 🙂

[Raybyrnes]

I would say there is more to it than that. You probably need to find out if these are ISO (sometimes referred to as Statutory or Qualified Option) and NSO (Non Qualified Stock Options. There are a number of different strategies that you can use to maximise the value of a transactions. You can exercise and Hold, exercise and sell along with different combination of the 2.

With 2 working people and your wife moving up the corporate ladder I would pay attention to the ramifications of potentially being hit with AMT (alternative minimum tax)if you generate gains off the options. I would also evaluate the potential of the company and how much exposure you have to this sector.

WIth your wife moving up the best deal might be to find professional assistance. It is typically money well spent.

[Raybyrnes]

I would say there is more to it than that. You probably need to find out if these are ISO (sometimes referred to as Statutory or Qualified Option) and NSO (Non Qualified Stock Options. There are a number of different strategies that you can use to maximise the value of a transactions. You can exercise and Hold, exercise and sell along with different combination of the 2.

With 2 working people and your wife moving up the corporate ladder I would pay attention to the ramifications of potentially being hit with AMT (alternative minimum tax)if you generate gains off the options. I would also evaluate the potential of the company and how much exposure you have to this sector.

WIth your wife moving up the best deal might be to find professional assistance. It is typically money well spent.

[Raybyrnes]

I would say there is more to it than that. You probably need to find out if these are ISO (sometimes referred to as Statutory or Qualified Option) and NSO (Non Qualified Stock Options. There are a number of different strategies that you can use to maximise the value of a transactions. You can exercise and Hold, exercise and sell along with different combination of the 2.

With 2 working people and your wife moving up the corporate ladder I would pay attention to the ramifications of potentially being hit with AMT (alternative minimum tax)if you generate gains off the options. I would also evaluate the potential of the company and how much exposure you have to this sector.

WIth your wife moving up the best deal might be to find professional assistance. It is typically money well spent.

[Raybyrnes]

I would say there is more to it than that. You probably need to find out if these are ISO (sometimes referred to as Statutory or Qualified Option) and NSO (Non Qualified Stock Options. There are a number of different strategies that you can use to maximise the value of a transactions. You can exercise and Hold, exercise and sell along with different combination of the 2.

With 2 working people and your wife moving up the corporate ladder I would pay attention to the ramifications of potentially being hit with AMT (alternative minimum tax)if you generate gains off the options. I would also evaluate the potential of the company and how much exposure you have to this sector.

WIth your wife moving up the best deal might be to find professional assistance. It is typically money well spent.

[USMCBunny]

Folks,

Thanks so much for the great (and fast) response.

The Last para in the letter states…

“This stock option grant is subject to the terms and conditions set forth in the XXX inc Amended and Restated 2006 Long Term Incentive Stock Option Plan. You should recieve your grant documents for your acceptance via the E*trade system w/in 60 days.”

So – I suppose the vesting sched, and timelines will be in there, I will fire more questions as they come.

As for the professional advice…. I agree in principle. We hired some financial planners about 1.5 years ago. They accepted a check for 1,000.00 and produced a massive folder which basically assumed I had never heard of compound interest, and then tried to sell me overpriced life insurance.

I have the basics down. Long/Medium/Short term investment plans have been successful thus far. I am considering sitting down with Rich and his associates, or some other planning outfit that I feel I can trust. My issue, is that I want more than a vanilla graph of historic investment trends … USAA told me 6 months ago to get out of gold, that it was too volitile, and that it was due for a fall. I would have lost a nice chunk had I taken that advice.

I post very rarely, but read this blog (and a couple others) pretty religiously. Is a financial planner going to do more for me?

Thanks again for the info (this particular bit, and the last couple years)

[USMCBunny]

Folks,

Thanks so much for the great (and fast) response.

The Last para in the letter states…

“This stock option grant is subject to the terms and conditions set forth in the XXX inc Amended and Restated 2006 Long Term Incentive Stock Option Plan. You should recieve your grant documents for your acceptance via the E*trade system w/in 60 days.”

So – I suppose the vesting sched, and timelines will be in there, I will fire more questions as they come.

As for the professional advice…. I agree in principle. We hired some financial planners about 1.5 years ago. They accepted a check for 1,000.00 and produced a massive folder which basically assumed I had never heard of compound interest, and then tried to sell me overpriced life insurance.

I have the basics down. Long/Medium/Short term investment plans have been successful thus far. I am considering sitting down with Rich and his associates, or some other planning outfit that I feel I can trust. My issue, is that I want more than a vanilla graph of historic investment trends … USAA told me 6 months ago to get out of gold, that it was too volitile, and that it was due for a fall. I would have lost a nice chunk had I taken that advice.

I post very rarely, but read this blog (and a couple others) pretty religiously. Is a financial planner going to do more for me?

Thanks again for the info (this particular bit, and the last couple years)

[USMCBunny]

Folks,

Thanks so much for the great (and fast) response.

The Last para in the letter states…

“This stock option grant is subject to the terms and conditions set forth in the XXX inc Amended and Restated 2006 Long Term Incentive Stock Option Plan. You should recieve your grant documents for your acceptance via the E*trade system w/in 60 days.”

So – I suppose the vesting sched, and timelines will be in there, I will fire more questions as they come.

As for the professional advice…. I agree in principle. We hired some financial planners about 1.5 years ago. They accepted a check for 1,000.00 and produced a massive folder which basically assumed I had never heard of compound interest, and then tried to sell me overpriced life insurance.

I have the basics down. Long/Medium/Short term investment plans have been successful thus far. I am considering sitting down with Rich and his associates, or some other planning outfit that I feel I can trust. My issue, is that I want more than a vanilla graph of historic investment trends … USAA told me 6 months ago to get out of gold, that it was too volitile, and that it was due for a fall. I would have lost a nice chunk had I taken that advice.

I post very rarely, but read this blog (and a couple others) pretty religiously. Is a financial planner going to do more for me?

Thanks again for the info (this particular bit, and the last couple years)

[USMCBunny]

Folks,

Thanks so much for the great (and fast) response.

The Last para in the letter states…

“This stock option grant is subject to the terms and conditions set forth in the XXX inc Amended and Restated 2006 Long Term Incentive Stock Option Plan. You should recieve your grant documents for your acceptance via the E*trade system w/in 60 days.”

So – I suppose the vesting sched, and timelines will be in there, I will fire more questions as they come.

As for the professional advice…. I agree in principle. We hired some financial planners about 1.5 years ago. They accepted a check for 1,000.00 and produced a massive folder which basically assumed I had never heard of compound interest, and then tried to sell me overpriced life insurance.

I have the basics down. Long/Medium/Short term investment plans have been successful thus far. I am considering sitting down with Rich and his associates, or some other planning outfit that I feel I can trust. My issue, is that I want more than a vanilla graph of historic investment trends … USAA told me 6 months ago to get out of gold, that it was too volitile, and that it was due for a fall. I would have lost a nice chunk had I taken that advice.

I post very rarely, but read this blog (and a couple others) pretty religiously. Is a financial planner going to do more for me?

Thanks again for the info (this particular bit, and the last couple years)

[Coronita]

I have a lot of things to say about stock options from my own experience and colleagues. But I'm at work. If you wait I'll post about them later tonight. The thing you want to make sure is you want to find out whether they are either

1) ISO (Incentive stock options)

or  

2) NQ (Non-qualified stock options) 

There are different tax consequences when it comes to exercising the two different stock options and whether you decide to sell right away or hold on. You have to be careful that you don't fall into an AMT tax trap situation if they are ISO(#1). Basically, this is an weird situation when you end up owing more taxes than the value of the exercised stock options themselves. Yes, it's possible, although I doubt in the current market conditions would it occur… This was a phenoma of the dot.com  when you're issued a lot of stock options that are at the time of exercise worth a lot of money but then subsequently fall when you actually sell it.

[Coronita]

I have a lot of things to say about stock options from my own experience and colleagues. But I'm at work. If you wait I'll post about them later tonight. The thing you want to make sure is you want to find out whether they are either

1) ISO (Incentive stock options)

or  

2) NQ (Non-qualified stock options) 

There are different tax consequences when it comes to exercising the two different stock options and whether you decide to sell right away or hold on. You have to be careful that you don't fall into an AMT tax trap situation if they are ISO(#1). Basically, this is an weird situation when you end up owing more taxes than the value of the exercised stock options themselves. Yes, it's possible, although I doubt in the current market conditions would it occur… This was a phenoma of the dot.com  when you're issued a lot of stock options that are at the time of exercise worth a lot of money but then subsequently fall when you actually sell it.

[Coronita]

I have a lot of things to say about stock options from my own experience and colleagues. But I'm at work. If you wait I'll post about them later tonight. The thing you want to make sure is you want to find out whether they are either

1) ISO (Incentive stock options)

or  

2) NQ (Non-qualified stock options) 

There are different tax consequences when it comes to exercising the two different stock options and whether you decide to sell right away or hold on. You have to be careful that you don't fall into an AMT tax trap situation if they are ISO(#1). Basically, this is an weird situation when you end up owing more taxes than the value of the exercised stock options themselves. Yes, it's possible, although I doubt in the current market conditions would it occur… This was a phenoma of the dot.com  when you're issued a lot of stock options that are at the time of exercise worth a lot of money but then subsequently fall when you actually sell it.

[Coronita]

I have a lot of things to say about stock options from my own experience and colleagues. But I'm at work. If you wait I'll post about them later tonight. The thing you want to make sure is you want to find out whether they are either

1) ISO (Incentive stock options)

or  

2) NQ (Non-qualified stock options) 

There are different tax consequences when it comes to exercising the two different stock options and whether you decide to sell right away or hold on. You have to be careful that you don't fall into an AMT tax trap situation if they are ISO(#1). Basically, this is an weird situation when you end up owing more taxes than the value of the exercised stock options themselves. Yes, it's possible, although I doubt in the current market conditions would it occur… This was a phenoma of the dot.com  when you're issued a lot of stock options that are at the time of exercise worth a lot of money but then subsequently fall when you actually sell it.

[ucodegen]

@Raybyrnes

Here are some interesting links:

Employee Stock Options Fact Sheet
The Investment FAQ
How Stocks and the Stock Market Work
Stock Links

You’re links don’t seem to be working… what are the raw URLs?

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