Avoid the $1M Mistake: The RSU Selling Plan Every Leader Needs in 2025

Episode TL;DR

If most of your net worth lives in your company’s stock, one market shock can quietly erase years of work. In this episode, Dan Pascone explains how a Rule 10b5-1 selling plan can help public-company leaders sell RSUs automatically, stay compliant during blackout windows, and avoid sending the wrong signal to the market.

You’ll learn how a disciplined, rules-based selling schedule may reduce concentration risk, support tax-efficient diversification, and give you a clear path to the liquidity you actually need instead of hoping the stock always goes up.

Key Takeaways

Concentrated RSU wealth is a hidden risk. When 50–70% of your net worth sits in one stock, a single 30–40% drop can cost you seven figures and delay your timeline for work-optional living.
Rule 10b5-1 plans create a written, pre-approved selling playbook. You design the rules during an open window, then trades execute automatically later—even during blackouts—within insider-trading guidelines.
Autopilot selling beats emotion and market-timing. A rules-based plan helps you avoid “just a little higher” thinking, missed windows, and panic selling that often follows bad headlines or earnings surprises.
Good plans are goal-based, not random. Dan walks through starting with liquidity and concentration targets, then designing when, how much, and at what prices to sell so your RSU sales match your overall plan.
Recent SEC rule changes make plan design and compliance more important. Cooling-off periods, no overlapping plans for the same stock, and certification requirements mean executives benefit from a robust, monitored process.

Key Moments

00:00 – The $1M mistake: Why concentrated RSUs and company stock can quietly put even brilliant leaders at risk of seven-figure losses.
00:21 – Blackouts and insider trading rules: How trading windows can close right when you most want to sell.
00:43 – Who this is for: Dan speaks directly to Google VPs, Amazon directors, and leaders at public companies with large RSU grants.
01:10 – The 70% concentration story: A real-world example of a leader whose net worth was heavily concentrated in their employer stock.
01:33 – What a Rule 10b5-1 plan is: A pre-approved game plan for selling stock that serves as an affirmative defense against insider trading accusations.
02:12 – Real plan structures: Examples of share- and dollar-based rules, plus how price thresholds can work.
02:40 – The emotional roller coaster: How holding out for “just a bit higher” can backfire when markets turn and windows close.
03:18 – How Dan builds plans with clients: Clarifying goals, setting selling rules, and using technology to automate execution.
04:02 – The 45% drawdown story: A leader who rode their stock up, refused to diversify, and watched millions disappear.
04:43 – Who can use 10b5-1 plans & new rules: Why they’re not just for the C-suite and what changed in 2023.
05:09 – Your action plan: Decide on liquidity and diversification targets now and automate a compliant selling strategy.

Episode Summary

In this episode, Dan Pascone tackles one of the most common blind spots for public-company leaders: over-concentrated wealth in their employer’s stock. He opens with stories of executives who watched millions evaporate in a single market swing because they didn’t have a disciplined selling strategy and found themselves locked out of trading during blackout windows. From there, Dan introduces Rule 10b5-1 trading plans as a way to pre-define your RSU and stock selling rules while you’re “clean,” so trades can run on autopilot later.

Dan explains that a 10b5-1 plan is essentially a written, pre-approved playbook filed with your brokerage firm. It might say “sell 5,000 shares on the 15th of every month above a certain price,” or “sell $250,000 of stock each quarter over multiple trading days.” Once in place, trades execute automatically—even during blackouts—according to your rules, which helps you steadily diversify and reduces the emotional temptation to time the market. He walks through a client case where a Google leader now sells on a monthly schedule and channels proceeds straight into a diversified portfolio, watching their concentration risk shrink over time.

The video closes with a candid comparison of those who used a plan versus those who didn’t: a senior leader who refused to diversify and saw their net worth fall from $8M to $5M when the stock dropped 45%. Dan emphasizes that these plans are not just for C-suite insiders; any public-company leader with RSUs can explore one, provided they follow updated SEC requirements around cooling-off periods, overlapping plans, and certifications. His final message: decide how much liquidity and diversification you need, build a rules-based 10b5-1 plan with your advisor, and let the system do the work—before the next market shock does it for you.

Full Episode Transcript

DAN: If most of your wealth is tied up in your company’s stock, then you’re carrying more risk than you might realize. I’ve seen brilliant executives, the kind that run billion-dollar divisions, lose millions overnight because they didn’t have a proper selling strategy. One market drop, one bad headline, and years of equity can vanish.

DAN: And to make matters worse, blackout windows and insider trading rules can leave you locked out and unable to sell when it matters most. In this video, I’ll show you how a Rule 10b5-1 plan can let you sell RSUs automatically, legally, and tax efficiently, so you can diversify, protect your wealth, and sleep at night without sending the wrong signal to the market.

DAN: And if you want even more strategies to protect and grow your equity, visit makingsenseofyourmoney.com. This is our free content hub with guides, videos, and tools for executives like you, from RSU strategies to tax-efficient retirement planning. If you’re a Google VP, an Amazon director, or a leader at any public company, you probably get a large chunk of your compensation paid to you in restricted stock units.

DAN: And when those RSUs vest, you’re sitting on real stock and, in many cases, large amounts of concentrated company shares. That can be a blessing, but also a major curse. I once met a public leader whose net worth was over 70% in his company’s stock. He loved the company and believed in the mission. But when the stock slid 30% during a tech selloff, he lost seven figures in value overnight.

DAN: He didn’t have a 10b5-1 plan in place, so he couldn’t sell during a blackout, and he had to sit and watch as he lost large portions of his hard-earned wealth.

DAN: So, what’s a 10b5-1 plan? A 10b5-1 plan is basically your pre-approved written game plan for selling company stock. You set it up during an open window when you have no material non-public information, and it tells your brokerage firm exactly how and when to sell in the future.

DAN: Once it’s locked in, the trades happen automatically, even if you’re in a blackout period or know something about the company that you can’t share. It’s your legal affirmative defense against insider trading accusations.

DAN: Here’s a few examples: sell 5,000 shares on the 15th of every month, but only if the stock price is above $120; or sell $250,000 of shares each quarter, spread over multiple trading days. This isn’t random selling. It’s a disciplined, rules-based system that keeps you compliant and consistent.

DAN: So, why does this matter? Without a 10b5-1 plan, you’re at the mercy of short open trading windows, which could be just a few weeks each quarter. Miss that window because you’re traveling, busy, or nervous about the market, and you could be stuck for months.

DAN: I’ve seen executives try to time their sales and hold out for just a little bit higher. Then the market turned or earnings disappointed and suddenly their RSUs were worth 30% less, and they couldn’t do anything until the next open window.

DAN: That emotional roller coaster is brutal. And if you sell too much stock at once, it can spook investors and make it seem like you’ve lost faith in your company. A 10b5-1 plan solves both problems. It keeps you selling on autopilot so you steadily diversify, and it smooths out sales to avoid market disruption or bad optics.

DAN: Here’s how we typically help a client set up a 10b5-1 plan. First, we need to clarify your goals. Do you need a million in liquidity over the next 12 months? Or are we trying to bring your company’s stock exposure down from 60% to 30% of your net worth?

DAN: Then we design the rules—how often to sell, how many shares or dollars to sell each time, any price thresholds, and how to help minimize taxes by selling the right stock lots at the right time.

DAN: And we use a platform that automates all of this, so trades happen without you lifting a finger. Filings get made and proceeds are wired to your preferred account for reinvestment.

DAN: For example, a client of ours from Google now sells a set number of shares each month and directs the cash straight into their diversified investment portfolio. They don’t even have to think about it. They just watch their concentration risk shrink and their overall portfolio balance grow.

DAN: I wish I could say everyone does this, but I’ve seen the opposite and it’s ugly. A senior leader at a major public company rode the stock up for years, never sold a share, and rejected every suggestion to diversify.

DAN: Then the stock plummeted 45% in six months, and their net worth went from eight million to five million, almost all from that one position. When I met this person and they told me their story, they said, “If I had had a 10b5-1 plan in place, I wouldn’t be starting over in my 50s.”

DAN: Here’s a few additional things to make note of regarding 10b5-1 plans. First off, these plans aren’t just for C-suite executives. Any public leader that receives restricted stock units has the ability to set up their own personalized 10b5-1 plan.

DAN: Also, the SEC tightened up some rules in 2023. There is a 90 to 120-day cooling-off period before trades can start. There are no overlapping plans for the same stock, and you must complete certification that you don’t have non-public information when you set it up.

DAN: Your plan has to meet these requirements to be valid and if it doesn’t, you lose legal protection. This is another reason to use a system that enforces compliance automatically.

DAN: So, here’s the takeaway. If you’re a public company leader with significant RSUs, decide how much liquidity and diversification you need. Work with your adviser to design a rules-based selling schedule and automate it through a compliant 10b5-1 plan so it runs on autopilot.

DAN: Don’t wait for the next market shock to remind you how fragile concentrated wealth can be. Make the decision once and let the system do the work.

DAN: Many executives I work with also have stock options, performance shares, or complex bonus structures, which can be just as risky if left unmanaged. That’s why in my next video, The Executive’s Guide to Mastering Equity Compensation, I explain how to bring all those pieces together into one coordinated, tax-efficient strategy. Click here and I’ll see you there.

Resources & Citations

SEC – Insider Trading Arrangements and Related Disclosures – Official overview of Rule 10b5-1 amendments, cooling-off periods, and disclosure requirements.
SEC Rule 10b5-1 Fact Sheet – Summary of the amended Rule 10b5-1 affirmative defense conditions, including cooling-off, certifications, and plan limits.
Charles Schwab – RSU Taxes and PSU Taxes – Explanation of how RSUs are typically taxed as ordinary income at vesting and then as capital gains or losses when sold.
TurboTax – How to Report RSUs or Stock Grants – Practical guidance on reporting RSU income and sales on your tax return.
Episode Page – Avoid the $1M Mistake (Tailored Wealth) – Canonical Tailored Wealth page and schedule link for a Wealth Clarity Consultation.
Making Sense of Your Money – Content Hub – Free guides, videos, and tools for executives managing equity compensation and broader planning.

Frequently Asked Questions

What exactly is a Rule 10b5-1 plan, and how does it help me as an executive?

A Rule 10b5-1 plan is a written, pre-approved trading plan that spells out how and when your company stock will be sold in the future. You set it up when you do not have material non-public information, and once it’s in place, trades execute automatically under those rules. When properly designed and implemented, the plan can provide an affirmative defense against insider trading accusations because the decisions about timing and amount were made in advance, not in reaction to new information.

Do I really need a 10b5-1 plan if I only have RSUs and no stock options?

If RSUs make up a large share of your net worth once they vest, you may still be taking on significant single-stock risk, even without options. A 10b5-1 plan can help you regularly convert RSU shares into diversified assets, especially when trading windows are short or unpredictable. The plan itself doesn’t guarantee results, but it can give you a consistent, rules-based way to turn concentrated equity into the liquidity your broader plan requires.

How are RSUs taxed, and does a 10b5-1 plan change the tax treatment?

In most cases, RSUs are taxed as ordinary income at vesting based on the fair market value of the shares, and subsequent gains or losses when you sell are treated as capital gains or losses. A 10b5-1 plan doesn’t change that basic tax character, but it can help coordinate the timing and size of your sales with your overall tax strategy. Because RSU and stock-sale taxes can be complex, it’s wise to coordinate your plan design with your tax advisor in addition to your financial planner.

What did the SEC change about 10b5-1 plans in 2023?

The SEC added several conditions to strengthen the 10b5-1 framework, including mandatory cooling-off periods (often 90–120 days) before certain insiders can start trading, limits on overlapping plans for the same stock, and new certification and disclosure requirements. These rules are meant to ensure that plans are genuinely pre-arranged and not used to trade opportunistically on inside information. Because the specifics can be technical and company policies may go further, executives should work with legal, compliance, and advisory teams to ensure their plans meet current standards.

Can I still change or cancel my 10b5-1 plan once it’s in place?

In many cases you may be able to modify or terminate your plan, but doing so can restart cooling-off periods and may raise additional disclosure or compliance considerations. Frequent changes can also undermine the perception that your selling is rules-based rather than opportunistic. That’s why it’s important to put thoughtful work into the initial design and to coordinate any later changes with your company’s legal and compliance teams.

How do I know how much company stock I should keep versus sell?

There is no one-size-fits-all percentage, but many executives find that allowing a single stock to dominate more than half of their net worth creates uncomfortable risk. A better approach is to define clear targets—such as reducing employer stock from 60% to 30% of your net worth over several years—then use your 10b5-1 plan and broader strategy to methodically work toward that goal. A qualified advisor can help you weigh your risk tolerance, career path, and long-term goals in deciding what concentration level feels both responsible and motivating.

Disclaimer

The information in this episode and on this page is for educational and informational purposes only and is not intended as, and should not be construed as, individualized tax, legal, or investment advice. Rule 10b5-1 plans and RSU strategies involve legal, tax, and market risks, and their suitability depends on your specific circumstances and eligibility under current laws and company policies.

Before implementing any 10b5-1 plan, selling company stock, or making other financial decisions, you should consult with your company’s legal and compliance teams as well as your own qualified tax professional and financial advisor.

Related Episodes & Resources

Next Steps

If this episode describes your situation—a large RSU position, tight trading windows, and growing concentration risk—your next move should be intentional, not reactive.

Clarify your equity plan with a pro: Visit Tailored Wealth to learn how a Life-Driven Plan can integrate your RSUs, options, and broader portfolio into one coordinated strategy.
Stay ahead of the next blackout: Subscribe to Making Sense of Your Money for ongoing guides and tools on equity compensation, taxes, and work-optional wealth.