This 50-year-old Seattle woman found out she owns $18M in a single stock, but has ‘no idea’ what to do with it — here’s why Dave Ramsey instructed her to seek ‘safety’ for her savings ASAP

The account had gone from barely worth anything to roughly $18 million at current market price, she told Dave Ramsey during a recent episode of The Ramsey Show. Although she didn’t reveal which company it was, some commenters speculated that it could be Nvidia, the tech giant that has surged tremendously over the past two years.

Regardless, this sudden multimillionaire says she has “no idea” what to do with her unexpected windfall. Ramsey offered some advice.

Diversify and withdraw in a tax-conscious way

Having much of your net worth tied up in a single stock is “scary and unwise,” says Ramsey. He recommends offloading some of the shares and investing her money elsewhere. However, given the magnitude of the fortune, selling even a fraction of the account would likely push Sarah into the top tax bracket.

He suggests speaking with an expert tax planner or investment adviser to minimize the tax bill. However, he insists on diversifying away from a single stock as soon as possible. “If I’m you, even if it costs me some money I would rather have the safety than I would the extra 20%,” Ramsey told her.

According to the Internal Revenue Service, the highest possible capital gains tax rate for someone in the highest tax bracket is 20%, making that the maximum (federal) tax bill Sarah would face. Depending on where you live, you may also face state taxes on your capital gains. For Sarah, in Washington State, that’s another 7%.

However, single stocks, particularly in the tech sector, are notoriously volatile. Etsy has lost 34% over the course of 2024, for example, while Facebook’s parent company Meta Platforms lost a whopping 70% of its value in 2022.

This is why financial experts recommend diversification, even if one stock has been a big winner.

Besides diversification, Sarah’s story offers another lesson for regular investors: the value of longer time horizons.