Financial advice for founders with shares or options
When most personal wealth is tied to one company, financial planning needs to look at concentration, liquidity and the life you want the equity to fund.
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Company wealth is concentrated wealth
Founders can have substantial paper wealth while remaining exposed to one business. The personal plan should recognise that concentration rather than pretending the equity is already a diversified investment portfolio.
Liquidity changes the decisions
A secondary sale, dividend or full exit can create cash that needs a different plan from illiquid founder equity. Timing, tax and legal questions may require other professional advisers as well.
Look for genuine founder experience
Do not confuse financial planning with transaction advice
The financial adviser's role is your personal financial plan. Corporate finance, tax structuring and legal execution may require separate specialists.
Identify what you own and when it becomes usable
Shares, options and conditional awards are different assets. Gather the grant or purchase documents, vesting terms, exercise price, restrictions and any expected transaction timetable. A valuation on paper is not necessarily money you can use for personal spending.
Ask the company's relevant team and your tax adviser to confirm the facts and tax treatment. Exercise, vesting and sale can be different events, and the applicable scheme rules matter. Do not assume every option award receives the same treatment or that tax arises only after cash is received.
The financial adviser should build the personal plan around confirmed rights and realistic scenarios, distinguishing existing accessible wealth from a possible future exit.
Model uncertainty in proceeds and concentration
A founder may rely on the same company for income and a large portion of potential wealth. Ask how the plan responds if a sale is delayed, the value falls or only some shares can be sold. Diversification decisions require attention to restrictions, tax and personal needs; they cannot be reduced to a single standard percentage.
For illustration, an expected £1m gross share value could differ from the cash eventually available because of exercise costs, tax, deal adjustments and deferred consideration. The planning input should identify each deduction and uncertainty rather than use the headline value as a spending budget.
Avoid making irreversible personal commitments solely against an anticipated liquidity event. A scenario can help show the consequences without claiming that the event will occur.
Coordinate the professionals before the transaction
Ask who checks the share documents, legal restrictions, tax calculations and personal investment recommendation. Ensure that all use the same transaction assumptions and know when those assumptions change.
Find out whether the financial adviser can provide planning before assets become available and how that work is charged. A service focused only on investing sale proceeds may begin too late to address some earlier questions.
After a transaction, reconcile actual proceeds and liabilities before implementing the longer-term plan. Retain the acquisition, award, exercise and sale records needed for future tax and planning work.
Sources and further reading
MoneyHelper - Choosing a financial adviser ↗
GOV.UK: tax and employee share schemes ↗
