PwC Partners have earned valuable benefits, and getting the most out of these benefits depends on managing some unique financial planning considerations. In this Insight, we review two of the most important: managing compliant investments and planning for optimal post-retirement cash flow.
PwC maintains robust personal independence policies to mitigate conflicts of interest, and these rules introduce unique complexity for how partners can best invest and manage their financial assets. For example, compliance policies limit investment in certain companies, and even approved investments today may not be approved in the future—forcing potential liquidation. This uncertainty can be a crucial roadblock in building out a tax-efficient equity portfolio to maximize future wealth, and in many cases, compliance requirements risk causing Partners to shy away from investing.
We are plugged directly into PwC’s system to pre-approve investments so we can help partners and employees evaluate whether their investments align with the firm’s independence requirements. However, navigating these policies can become increasingly complex, especially as you are building wealth, or retirement approaches and portfolio diversification becomes a greater priority.
Invariably the moment will come when a partner is forced to sell an investment within a matter of days that was previously approved. One option might be to donate the position to charity or a Donor Advised Fund, thereby avoiding a capital gain and getting a current tax deduction. By working with Wealthstream, these urgent items can be handled efficiently.
Another typical challenge we see with PwC Partners is a large portion of annual income arriving when the firm makes fiscal year-end distributions. Investing this income all at once risks excessive exposure to short-term market swings.
Based on our experience over the last decade of working with Partners, systematically investing on a monthly basis has proved to be beneficial. A monthly savings plan works because it is almost impossible to have perfect timing investing. With this method, you are constantly adding to your portfolio and will ultimately have more money working for you longer—the true driver of wealth.
Additionally, a laddering strategy can help PwC Partners optimize liquidity and maximize yield by staggering income streams or investment maturities to align with cash flow needs and market conditions. This approach ensures consistent access to funds while preserving opportunities for long-term growth and minimizing unnecessary tax impacts.
At Wealthstream Advisors, we take a hands-on approach to working with PwC Partners to maintain a custom, fully compliant portfolio that is tax-efficient, low-cost, diversified, and carefully targeted to achieve personal financial goals.
Our experience working with PwC Partners proves invaluable in anticipating and proactively avoiding potential compliance issues, and our team actively liaises with the PwC compliance team to ensure all accounts and investments are approved. By simplifying the complexity that comes with compliance management, we help Partners focus on tailored investment strategies that match personal retirement objectives, ensuring financial plans are ready to deliver the retirement they envision.
For many PwC partners, post-retirement income comes from multiple streams, including the Partner Retirement Plan and deferred income plans. These multiple income sources add to the complexity of cash flow and management in retirement — and, by generating an unusually high retirement income, can complicate tax strategy.
At Wealthstream Advisors, we work with Partners to understand how diverse cash flows can best contribute to both retirement goals and complex longer-term issues like estate and legacy planning. This practice is particularly important for Partners with sufficient income from pensions, Social Security, and other inflows to cover living expenses.
In many cases, the right path forward will depend on personal financial context and career timeline. For example, the most common situation we come across is a Partner who wants to make a large purchase such as a home, and realizes that most of their assets are in retirement accounts and cannot be accessed without penalty. To avoid this situation, building up assets outside of retirement accounts can be invaluable.
Partnering with a financial advisor can help create a tailored plan that addresses these distinct factors while aligning with your long-term financial objectives. We invite you to schedule a complimentary 30-minute consultation with a Wealthstream Advisor today.