October is National Financial Planning Month, and many of us are beginning to look ahead at our plans for 2023. Robert Pitti, Liquid Stock Founding Partner, shares a few insights to help you plan to achieve financial freedom in the year ahead.

In today’s current economic climate, it’s vital to reassess your financial assets and understand where changes may be needed in your portfolio. It’s possible that your financial goals have shifted over the past year, and financial freedom may seem further out of reach. However, if you have value locked up in private company shares, you may have more opportunities than you think. Here are a few goals to think about when planning your financial future, and some ideas on how to work towards them in 2023.

The Opportunity of Homeownership

Whether you own a home, or are planning to buy a home in 2023, home equity can be a valuable investment in a long-term portfolio. As some of the assets in your portfolio may decrease in value over time, the value of a home tends to increase over the years. This makes it a great hedge against inflation and a valuable piece of a diversified portfolio.

In the aftermath of the pandemic, the housing market has been struggling to stabilize, and buying a new home became increasingly expensive in 2022. It was a sellers’ market above all, as house prices rose by more than 15% in this record-breaking appreciation year. Homes were sold for way above asking price, while mortgage rates climbed to the highest they’ve been since the housing crisis in 2008.

However, the forecast for 2023 is shifting, as economists are predicting a continued housing price correction and an inevitable plunge in prices. Some economists claim that the housing market is already in a recession, and next year we could see as much as 20% drops in prices by summer 20231. Meanwhile, Goldman Sachs predicts home prices will fall in more than 39% of US cities next year. It’s too soon to tell for sure, but 2023 could be the opportunity you’ve been waiting for to buy your dream home. Homebuyers have been biding their time, waiting for the best opportunity to make their move.

As prices fall – yet mortgage rates remain high – it may be most prudent to tap into the value of your private shares to be able to make a competitive offer to secure the house of your dreams (and avoid overpaying on interest).

Supporting Your Dependents with Rising Costs

Whether you are a parent of one or multiple children, or the responsible caregiver of an elderly family member or dependent, a lot has changed in the past few years as the rates of education and senior care facilities have increased exceptionally. College tuition in the U.S. can cost upwards of $30k per child per semester (go ahead and multiply that by 2 and then 4 to see what it costs in total per child, without including room or board). If you are the primary caregiver for elderly dependents, on average, it can cost around $50k per year to care for an elderly dependent at home, and upwards of $100k per year in a nursing home or outside facility. With inflation, prices are only expected to continually rise.

It’s difficult to achieve “financial freedom” with these large annual expenses looming and on the rise. If you have more than one financial dependent, then you may want to consider quicker paths to liquidity using the value locked up in private shares in order to pay for expenses without dipping into your other long-term investments.

Preparing for Your Comfortable Retirement

Preparing for retirement is the ultimate goal on your path to financial freedom. If this is within reach for 2023, congratulations! If not, here are some things you should be thinking about.

As inflation continues to rise, spending power of your nest egg may steadily decrease in value. With higher costs of goods and services, you may be wondering if you’ll be able to afford and maintain your lifestyle without a continued source of income2. The most important part of a solid retirement plan is a diversified portfolio with multiple assets. In times of economic volatility, there are ways to structure your investments and protect your net worth from decreasing beyond your comfort levels.

Current access to liquidity is critical to be able to make the investment decisions that are right for you and your retirement. If you hold private company equity, our liquidity solutions can help get you through this market cycle and capitalize on attractive investment opportunities to help safeguard your retirement.

At Liquid Stock, we set out to build a liquidity solution that’s tailor-made to support entrepreneurs who hold options and shares in private companies as they plan their financial futures. We provide cash when you need it most, with a fair and transparent liquidity solution. Our solutions are structured as non-recourse transactions3, meaning that only the value of your private shares is used as collateral. You maintain ownership and upside potential in your shares, unlike a sale. So, when the opportunity is right, you can get the cash you need and still participate in your company’s future success.

Reach out today to get started and begin your path towards financial freedom in 2023.

About the Author:
Robert Pitti, Founding Partner at Liquid Stock, is an experienced wealth manager who has provided advisory services to many successful entrepreneurs and venture capitalists.



1https://markets.businessinsider.com/news/stocks/housing-market-recession-crash-home-prices-inflation-federal-reserve-pantheon-2022-9
2https://www.forbes.com/sites/chriscarosa/2022/07/18/determining-how-todays-inflation-impacts-your-retirement-ongoing-needs-tomorrow/?sh=2040a50540b5
3As used herein, “non-recourse” means that a transaction counterparty is not personally liable for the difference between the value of the advance made to the counterparty and the value of the collateral shares upon a liquidity event or upon such other time(s) as defined in the transaction agreement, if the value of the collateral shares is less than the advance or other amount owed. In Liquid Stock transactions, the Counterparty will be personally liable in certain enumerated “Events of Default” defined in the applicable transaction agreement. These events include but are not limited to, failure to pay amounts owed under the agreement when due, breach of representations and covenants, and transfer of collateral shares in violation of the transaction agreement. Following such an “Event of Default” a transaction counterparty may be personally liable for the entire amount due under the agreement, even if it exceeds the value of the collateral shares.

This blog post is intended for general informational and education purposes only.  Liquid Capital Management, LLC (together with its affiliates, “Liquid Stock”) makes no representations as to the accuracy of information in this post, and no representations or guarantees as to specific outcomes from relying on this post. No content in this post is intended or should be construed as tax, investment, legal or accounting advice by Liquid Stock, or as an offer to sell or solicitation of interest to purchase any securities offered by Liquid Stock. Liquid Stock does not provide tax or other financial, legal or regulatory advice to its transaction counterparties. While reasonable steps have been taken to ensure that the information herein is accurate and up to date, no liability can be accepted for any errors or omissions. All views and information contained herein are as of the date hereof and subject to change. Information contained in third-party links has not been independently verified by Liquid Stock and inclusion of such links should not be interpreted as an endorsement or confirmation of the content therein. Prospective investors considering an investment in a Liquid Stock fund should not consider this content as fund marketing material.