Case Study: From $9M in AVGO Stock to a Diversified Legacy Plan
Jeff, a Senior Engineer at Broadcom, built substantial wealth through his ESPP and 401(k), accumulating $9 million in company stock and $3 million in retirement savings. But when market volatility caused his portfolio to swing by over $1.3 million, Jeff and his wife Lauren knew it was time for a change.
With Mercer Advisors, they found a team that could help them reduce risk, plan for the future, and align their wealth with their values.
Highlights:
- Diversified $6M from Broadcom stock, reducing exposure to <25%
- Donated $1M to a Donor Advised Fund for tax savings and philanthropy
- Implemented a 10b5-1 plan and explored exchange fund strategies
- Integrated estate planning to leverage sunsetting tax exemptions
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The challenge: Volatility and uncertainty
Unprecedented market volatility resulted in dramatic swings in Broadcom’s stock price, causing Jeff’s portfolio to fluctuate wildly. At one point, he lost over $1.3 million before rebounding to a peak of over $9 million.Residing in Fort Collins, Colo., with his wife Lauren and their two children, Jeff’s commitment to his career at Broadcom is balanced by his aspirations for a more relaxed future. The market’s rollercoaster ride and a desire for change led him to consider reducing his work pace, possibly shifting to consulting or philanthropy.Seeking a holistic solution
In response to these challenges, Jeff and Lauren turned to Mercer Advisors. They weren’t just looking for investment advice; they needed a comprehensive strategy. Mercer Advisors provided a dedicated team that included a wealth advisor, in-house CPA, and an estate strategist, all working together to manage every aspect of their financial life, including tax filings.Strategic moves: Diversification and tax planning
Mercer Advisors advised diversifying $6 million of Jeff’s $9 million concentrated Broadcom stock, reducing his exposure to under 25%. This move was a key part of the couple’s plan to achieve financial independence, allowing Jeff to work on his own terms.In addition, specific tax lot sales were implemented and a 10b5-1 plan was established to enable systematic and compliant future sales. An exchange fund was also considered to further diversify Jeff’s concentrated stock position without triggering immediate tax consequences.
Planning for the future and the next generation
The Mercer Advisors team helped Jeff and Lauren take advantage of the sunsetting federal estate tax exemption, maximizing the inheritance for their children.They also made significant charitable contribution, establishing a Donor Advised Fund (DAF) with a $1 million donation from their lowest-basis Broadcom shares, achieving both tax efficiency and philanthropic impact.
A confident path forward
Today, Jeff and Lauren’s diversified investment portfolio balances the remaining Broadcom stock with a robust, tax-efficient nest egg. With a clear plan for each asset and a strategy for growth and preservation, they are well-prepared for their financial future and the legacy they will leave for their family.Looking ahead to post-retirement when Jeff is no longer bound by Broadcom’s trading restrictions, they are exploring the use of derivatives and options strategies. This proactive planning is part of their ongoing strategy to grow and preserve their wealth, helping to ensure a secure and fulfilling future with Mercer Advisors as their family office partner.
The Mercer Advisors difference
With Mercer Advisors as their family office partner, Jeff and Lauren have transformed market volatility into a launchpad for long-term security, flexibility, and legacy planning.
This case study is hypothetical and intended for illustrative purposes only. It does not represent an actual client or an actual client’s experience but rather is meant to provide an example of the process and methodology at Mercer Advisors. This case study should not be construed by a client or prospective client as a guarantee that they will experience a certain level of results if Mercer Advisors is engaged, or continues to be engaged, to provide investment advisory services. An individual’s experience may vary based on a client’s individual circumstances. There can be no assurance that Mercer Advisors will be able to achieve similar results in comparable situations. No portion of this case study is to be interpreted as a testimonial or endorsement of Mercer Advisors’ investment advisory services, and there is no way for Mercer Advisors to ascertain whether the hypothetical client(s) would have been satisfied with their results. The information contained herein should not be construed as personal investment advice. All investment strategies have the potential for profit or loss. Changes in investment strategies, contributions or withdrawals may materially alter the performance and results of your portfolio. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will either be suitable or profitable for a client’s investment portfolio. Diversification and asset allocation do not ensure a profit or protect against a loss.
Mercer Advisors is neither a law firm, nor a certified public accounting firm, and no portion of its services should be construed as legal or accounting advice. All estate planning documentation preparation and other legal advice is provided through select third parties unrelated to Mercer Advisors. Tax preparation and tax filing are a separate fee from our investment management and planning services.
Is Your Wealth Strategy Built For What’s Next?
Whether you’re managing AVGO stock, planning for retirement, or building a legacy, Mercer Advisors brings together wealth advisors, CPAs, and estate planners all under one roof. Our integrated approach helps clients like Jeff turn complexity into opportunity.
Because your finances work better when they work together. And your future works better when it’s built around you.
Specialized Services for Broadcom Employees
- RSU vesting strategy tailored to Broadcom’s quarterly release and blackout periods
- ESPP tax planning using Broadcom’s 15% discount and lookback provision
- Diversification plans for AVGO stock concentrations post-vesting
- 10b5-1 plan design for Broadcom insiders with trading restrictions
- Charitable gifting using low-basis AVGO shares via Donor Advised Funds
- Mega backdoor Roth strategies using Broadcom’s Schwab 401(k) plan
- Cash flow modeling for Broadcom RSU refresh and bonus cycles
- Tax withholding analysis for under-covered RSU vesting events
Mercer Advisors is not a law firm and does not provide legal advice to clients. All estate planning document preparation and other legal advice is provided through select third parties unaffiliated with Mercer Advisors. Mercer Global Advisors has a related insurance agency. Mercer Advisors Insurance Services, LLC (MAIS) is a wholly owned subsidiary of Mercer Advisors Inc. There is no guarantee that SRI/ESG investment products or strategies will produce returns similar to traditional investments. SRI/ESG investment criteria exclude certain securities/products for non-financial reasons, and therefore investors may forego some market opportunities available to those who do not use such criteria.
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Frequently Asked Questions
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