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Business and Personal Planning for Financial Success - Stephen Hammers
Stephen M. Hammers is a Senior Financial Consultant and Assistant Vice President with Merrill Lynch. Stephen has worked with Merrill Lynch for six years. He is a Certified Financial Manager and a Certified Investment Management Analyst - Final stages of completion through the Warton School of Business.

His specialities include:

1. High Net Worth Planning - Investment, Estate, Retirement, Survivor, Tax, Concentrated Stock Planning
2. Endowments and Foundations
3. Profit Sharing, Money Purchase and Defined Benefit Plans

Stephen obtained his BS and BA degree from Middle Tennesee State University.

Stephen M. Hammers
Certified Financial Manager
Senior Financial Consultant
Merrill Lynch
800-779-8518
615-373-6861
Stephen_Hammers@ML.com


Question 1 - Hello Stephen, Profit Sharing and Employee Stock Option Plans were quite the buzz words of the 90's. Do employee's generally value these options? Do organizations that involve employees in these plans have higher retention rates and satisfaction? And with each of these plans, in general, approximately how much of the total profit and equity goes to employees and how much is allocated to upper management? I have often wondered if there is a lot of disparity between upper management and the employees. by yvette on May 2, 2000

Answer 1 - Yvette, Profit Sharing Plans and Employee Stock Option Plans are a value tool for improving rentention and productivity of employees. The amount of profit given depends on the company. The maximum allocation of contributions by the employer that can be made to a participant's account is the lessor of 15% of compensation or $30,000 per year.

For upper management a company can establish a Supplemental Executive Retirement Plan (SERP), a Executive Compensation Deferral Plan, a Executive Retirement Income Plan (ERIP)

ESOP have been (traditionaly)used for upper mananagement as a form of additional compensation and rentention.

ESPP Employee Stock Purchase Plan is antoher valuable tool.
(Employees buy stock through payroll deduction at a 15% discount)

If I can help any further call me 800-779-8518

Stephen Hammers
Senior Financial Consultant
Merrill Lynch
by Stephen Hammers on May 2, 2000
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Question 2 - Stephen, As the founder of a business with essentially all assets invested in the business, what key decisions facilitate more rapid liquidity and diversification. Tim by tim on May 2, 2000

Answer 2 Tim, I believe you are asking how to liquidate a business faster than normal and how can you diversifiy the assets.

The key decision to liquidate a business and reinvestment the assets for better diversification.
1. Total after tax return. How much money can you make within your exsisting business versus diversifying the assets.
2. Risk of all of your assets in a single business versus a stock portfolio (example).
3. Time frame you need the asset to provide a lifestyle (or established goal).

Key: What are your options, your risk and your return.

Diversification.

1. Don't invest throught the rear view mirror
2. Avoid the heard mentality.
3. What is the value?
4. What is the risk?

Based on the question. I had to give a general answer, not knowing your current situations or your goals.

Stephen Hammers
Senior Financial Consultant
Merrill Lynch
800-779-8518
by Stephen Hammers on May 2, 2000

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