For generations, investing followed a fairly predictable script: build wealth steadily over the course of a career, diversify along the way, retire somewhere around 65, and gradually begin drawing from the portfolio.
For many investors, that script still works. But over the years, we’ve watched a very different pattern emerge among many of the professionals, executives, and entrepreneurs we work with. Wealth can arrive quickly, remain highly concentrated, and coincide with a career that ends years earlier than expected. Nowhere is this shift more apparent than in the tech industry, but it’s hardly limited to tech. The shape of these portfolios and the timing of these careers simply don’t fit the traditional model. The result: their investment strategy has to look different, too.
When stock is overly concentrated.
Many of our clients arrive at wealth in a very different way, and tech professionals offer a prime example. Equity compensation, a benefit once largely reserved for senior leadership, became far more widespread with the rise of the tech industry and the dot-com era. Today, stock options, RSUs, and other forms of equity compensation can create significant wealth for employees across an organization—and sometimes at lightning speed.
From an investment perspective, that creates an immediate challenge. The same stock responsible for creating substantial wealth can also become its greatest source of risk. A single employer’s stock may represent the overwhelming majority of a household’s investable assets, leaving years of accumulated wealth far too dependent on the success of one company—and vulnerable to everything from a disappointing earnings call to a fundamental shift in the market.
Managing a concentrated position is, first and foremost, an investment management challenge. Creating true diversification requires a deliberate strategy around tax-aware selling, hedging when appropriate, and the timing of transactions around trading windows, all without allowing the tax consequences alone to dictate the investment decision.
For clients who are charitably inclined, this can also be an opportunity to think differently about giving. Donating appreciated stock—directly or through a donor-advised fund (DAF)—may help reduce a concentrated position while potentially avoiding capital gains taxes on the donated shares. More importantly, it allows clients to turn some of the wealth they’ve created into support for the people and causes that matter most to them. We’ve always believed that wealth is about more than what you accumulate. It’s also about what you’re able to do with it.
There’s often an emotional challenge as well. No matter the industry, company stock is often about much more than the investment itself. It also represents a career, a mission, and the source of the client’s income and overall wealth. Diversifying can feel like betting against the company that created it. We understand that reluctance. We’ve sat across the table from clients who know they own too much of one stock but still struggle with the decision to sell. They know the company. They believe in its future. In many cases, they helped build it. Our job is to help them separate their passion for the company from the question of how much of their financial future should depend on it.
When wealth comes in a windfall.
Other clients face a different type of challenge. A company sells. An acquisition closes. Previously illiquid equity suddenly becomes a significant pool of cash that needs a strategy. We’ve seen what that moment can feel like for clients. One day, the number on paper is theoretical. The next, the money is sitting in an account—and every decision suddenly feels heavy.
How much risk should the portfolio take? How should the capital be diversified? How quickly should it be put to work? For someone who has spent a career building a company, developing a product, or becoming an expert in their field—not managing a large investment portfolio—those decisions can feel like an entirely new job. This is where experience and process matter. Our goal is to give that capital a purpose, build the right portfolio around it, and put it to work for the long term.
When retirement comes early.
We’re also having more conversations with clients whose careers are ending differently—and often earlier—than they anticipated. We’re seeing this particularly in industries undergoing rapid change, where mergers, acquisitions, restructuring, and employee buyouts can quickly shift the trajectory of a career. Some are offered attractive exit packages. Others find their roles eliminated after an acquisition or restructuring. Still others (as highlighted in this recent Fortune article) reach a point where their industry has changed so dramatically that they’re no longer sure they want to keep changing with it.
Over and over again we hear different versions of the same question: “Can I afford to be done?”
Whatever brings someone to that question—a buyout too attractive to pass up, a change in the industry, or simply a lack of desire to reinvent a career for the fourth or fifth time—the investment consequence is the same: the portfolio may suddenly need to fund a longer retirement than originally modeled, with fewer working years available to recover from a poorly timed downturn.
Tackling new challenges with a time-tested philosophy.
After nearly 25 years of managing client portfolios, we’ve learned that new challenges don’t necessarily require abandoning the principles that have worked. They require applying those principles to a new set of circumstances.
At LCM, that comes back to a philosophy that has guided us since 2002: growth and protection. We want our clients’ wealth to continue working for them, often for decades, while protecting what they’ve worked so hard to build. When a family’s wealth has been created through one company, one stock, or one liquidity event, getting that balance right becomes even more important.
The answers are different for every client, but the conversations we’re having often come back to a few key questions:
How much of my company stock should I continue to own?
We build a disciplined path toward diversification using tax-aware selling strategies, hedging where appropriate, and implementing charitable strategies for clients who want to incorporate giving into the process.
What do I do with all this cash?
We build a diversified portfolio and establish a schedule for putting capital to work rather than allowing a single moment in the market to determine the portfolio’s starting point.
Can I retire earlier than I planned?
We stress-test the portfolio against the client’s actual circumstances and timeline—not a traditional retirement age that may no longer apply.
What happens if the market falls right after I retire?
We build reserves and withdrawal strategies into the portfolio, creating sources of liquidity that can help avoid selling long-term investments during a poorly timed downturn.
None of this requires predicting where AI is headed or what any single company’s stock will do next. It requires building a portfolio that doesn’t depend on getting those predictions right.
The terrain may be new. The principles aren’t.
If you’ve built significant wealth over the course of your career, there’s a good chance your financial life doesn’t look much like your parents’ did. Maybe most of your wealth is tied up in the company you helped build. Maybe you’ve just experienced a liquidity event. Or maybe your career could end sooner than you imagined, and you’re wondering whether your portfolio is ready for that.
These are complicated questions, but they’re exactly the kinds of conversations we have with our clients every day. The circumstances may be different, but our job remains the same: to understand what your wealth needs to do for you, then build and manage a portfolio designed to do it—with the right balance of growth and protection for whatever comes next.
