Executive Compensation Planning for Retirement
How to make better decisions with bonuses, equity, and deferred compensation
If you’re in a leadership role—or recently stepped out of one—you likely have more than just a salary.
You have multiple forms of compensation, each with its own timing, rules, and tax impact.
You may be looking at:
- Annual bonuses tied to performance
- Equity compensation like RSUs or performance shares
- Deferred compensation
- Company stock built up over time
And now you’re trying to answer a different kind of question:
How does all of this actually work together as I approach retirement?
Not just what you have.
But when it pays… how it’s taxed… and how it fits into your plan.
No pressure. Just a conversation to see if we can help.
The real challenge isn’t the pieces—it’s the timing
Most people we talk with aren’t confused about what they have.
They understand their compensation.
What’s less clear is how it all plays out—especially near retirement.
Because this is when things start to overlap:
- Final bonuses are paid
- Equity vests or pays out
- Deferred compensation starts paying out
- Your earned income may drop—or stop
And suddenly, multiple decisions show up all at once.
That’s where planning matters.
A simple way to think about it
If you want a starting point, here’s a simple framework:
- Bonuses → understand when they’re paid and how they affect your taxes
- Equity → plan vesting and sale decisions across multiple years
- Deferred compensation → know when it pays and how it stacks with other income
- Retirement timing → coordinate all of the above before making a final decision
The goal isn’t to optimize one piece.
It’s to coordinate all of them.
Why this becomes more important near retirement
Earlier in your career, compensation is about growth.
At this stage, it’s about transition.
Because the same decisions that used to feel routine now have long-term consequences.
You may only have one opportunity to:
- Decide when to retire
- Control when certain income hits
- Manage how your taxes play out over time
And those decisions are connected.
Where we see planning matter most
Executive compensation isn’t complicated because of the individual pieces.
It’s complicated because of how they show up together.
In a single year, you might have:
- A final bonus
- RSUs vesting
- Performance shares paying out
- Deferred compensation beginning
- Possibly severance
Each one makes sense on its own.
But together, they can push income higher than expected.
That’s where coordination becomes valuable.
What many advisors miss
Many advisors focus on investments.
Some focus on retirement saving to get to retirement.
But the transition into retirement is where many of the most important decisions happen.
You don’t need separate answers.
You need a plan that connects:
- When each piece of compensation pays
- How it affects your taxes over time
- How it aligns with your retirement date
- What decisions need to be made before you leave your employer
That’s a different kind of planning.
Understanding the key pieces of your compensation
1. Annual bonus
Typically tied to company and individual performance
Usually paid in cash
What matters most:
- When it will be paid
- How it impacts your tax year—especially if you retire mid-year
2. Equity compensation
Often includes:
- RSUs
- Performance shares
- Stock options
What matters most:
- When awards vest
- How performance affects payouts
- When and how to sell shares
3. Deferred compensation (nonqualified plans)
Designed to delay income today and receive it later.
Common features:
- Elections made in advance
- Distribution at retirement and/or over time
- Limited flexibility once set
What matters most:
- When distributions begin
- How they overlap with other income
- How they affect taxes across multiple years
4. Retirement plans
May include:
- 401(k)
- Pension or cash balance plan
- Supplemental executive retirement plans
These often interact with your compensation decisions more than people expect.
How this fits into your retirement plan
We don’t start with compensation.
We start with your overall retirement plan—and then align your compensation with it.
That typically means:
Step 1: Map your timeline
- Bonuses
- Equity vesting
- Deferred compensation payouts
Step 2: Identify key decision years
- Higher-income years
- Lower-income opportunities
- Transition years around retirement
Step 3: Coordinate decisions
- When to retire
- When income is recognized
- When to reduce concentration in company stock
Step 4: Adjust over time
Because these decisions don’t happen all at once—they unfold over several years.
Common questions we hear
The bottom line
You’ve built a successful career.
Now the focus shifts to how that success is paid out—and how it fits into your retirement.
Executive compensation doesn’t need to feel overwhelming.
But it does need to be coordinated.
Let’s make sure you get this right
Most people who reach out to us are getting close to retirement and want to make thoughtful, informed decisions.
If that’s where you are, we can help you think through your next steps.
Important Disclosure
Keil Financial Partners is not affiliated with or endorsed by any employer mentioned. These companies have not reviewed or approved this content.
This information is general in nature and may not reflect your specific compensation plans. Please review your plan documents and confirm details with your employer or plan administrator.