I have been in the US for the last week attending a conference for my company. I spoke to a lot of people and networked with quite a few and understood that the way that they generate wealth is very different from the way we as indians think about wealth.
So i thought that since there are a lot of people who work in MNCs here in India, it may just make some sense for me to write a little on this
One of the biggest ways that people generate wealth in the US is from Employee Stock Options. I know that with the changes in the tax structure here in India, that has really lost some sheen and are not widely used at all.
However in the US for senior people they actually dont have a trigger price - but give out stock for performance. So if the stock falls then what you get in your pocket is lesser, but there is no risk that the market price will fall below the trigger price ( I remember a lot of people who had GE stocks who were left high and dry because of the trigger price was higher than the existing stock in the market)
So what does this mean for people .
When you are looking to move into a company- evaluate if you can have stocks as part of the negotiation process. Companies are willing to put in money in this situation if the person they are hiring is good.
This is THE way that a lot of senior people in the US make a LOT of money.
So think about this-- this does make sense.
Earlier posts on a similar subject
http://simplefinancialsense.blogspot.com/2010/10/secret-of-20-risk-free-returns.html
Happy Investing.
( Dont forget to subscribe using the links on the right or become a follower of the blog)
So i thought that since there are a lot of people who work in MNCs here in India, it may just make some sense for me to write a little on this
One of the biggest ways that people generate wealth in the US is from Employee Stock Options. I know that with the changes in the tax structure here in India, that has really lost some sheen and are not widely used at all.
However in the US for senior people they actually dont have a trigger price - but give out stock for performance. So if the stock falls then what you get in your pocket is lesser, but there is no risk that the market price will fall below the trigger price ( I remember a lot of people who had GE stocks who were left high and dry because of the trigger price was higher than the existing stock in the market)
So what does this mean for people .
When you are looking to move into a company- evaluate if you can have stocks as part of the negotiation process. Companies are willing to put in money in this situation if the person they are hiring is good.
This is THE way that a lot of senior people in the US make a LOT of money.
So think about this-- this does make sense.
Earlier posts on a similar subject
http://simplefinancialsense.blogspot.com/2010/10/secret-of-20-risk-free-returns.html
Happy Investing.
( Dont forget to subscribe using the links on the right or become a follower of the blog)
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