Career‑portfolio alignment risk

The Lilac Wealth thread linked to a Mar. 27, 2026 Lilac Wealth blog titled “When Your Career and Your Portfolio Move in the Same Direction,” which framed the issue as salary, equity and career human capital moving together. (lilac-wealth.com) Financial-advice firms commonly flag holding more than 10–20% of investable assets in a single employer stock as overconcentration, and many advisers treat exposure above ~25–30% of total net worth as a “red zone” that typically triggers an action plan. (schwab.com) Scenario‑modelling tools recommended by wealth managers include scenario analysis and stress testing (e.g., historical-stress replay or hypothetical shocks) and Monte Carlo simulations to measure outcomes from shocks such as a 30% sector equity drawdown or a rapid 300‑basis‑point rate rise. (riskpublishing.com) Concrete hedges advisers use after model outputs include options overlays (protective puts or collars) to cap downside, staged systematic sales or SEC Rule 10b5‑1 trading plans for insiders, and pooled exchange‑fund contributions that typically impose ~7‑year lockups to defer capital gains while diversifying. (envestnet.com) Canadian tax mechanics change the trade-offs: RSUs are treated as employment income at vesting with employer withholding reported on the T4, while stock‑option taxation and deductions are governed by CRA rules and the federal government announced on Mar. 21, 2025 that it would not proceed with previously proposed changes to the stock‑option deduction. (absfinances.com) Total‑portfolio planning frameworks from Morningstar and financial-planning practitioners recommend explicitly modelling human capital (future salary and equity grants) as part of net‑worth scenarios and then shifting sector exposure or glidepath assumptions if career income is concentrated in tech. (morningstar.com)