Maximize Your Cardinal Bonus and LTI: Smart Moves for Your Variable Compensation

Summer brings about more than just the heat. For many Cardinal Health employees, it also brings your annual bonus and long-term incentives. These dollars are more than compensation. They are one of the few moments each year when you can make a meaningful shift in your long-term financial direction.

During my years at Cardinal, I learned this firsthand. Variable compensation was always appreciated, but it was even more valuable when I used it with intention. Without a plan, it disappeared into everyday spending. With a plan, it helped moved my financial life forward.

That is the opportunity in front of you.

Start with clarity on taxes

Bonuses are typically subject to supplemental withholding. CAH Stock awards may create additional tax obligations depending on how and when they are sold. Before you make any decisions, take a moment to understand the tax impact. It is the simplest way to avoid surprises and make sure the dollars you receive are truly yours.

Understand how your LTI works

Your long-term incentives deserve a closer look. Should you sell shares once they vest or continue to hold them. The right answer depends on your broader financial picture and how much exposure you already have to Cardinal stock.

For employees with RSUs, one point often gets missed. The tax bill is largely created at vesting, not at the sale. The value of the shares at vesting is treated as ordinary income automatically. Selling later may create capital gains, but for most employees those gains are smaller than the taxes owed at vesting.

Once you understand the tax side and your exposure to Cardinal stock, you will have a clearer picture of your real take home variable compensation.

Practical Moves for Your Bonus and LTI

Here are the most common ways we’ve seen Cardinal professionals use their variable compensation to strengthen their financial lives.

Pay down high interest debt - Eliminating double digit interest debt often creates a better return than traditional investments.

Top off emergency savings - Three to six months of expenses in a high yield savings account creates stability and flexibility.

Increase retirement contributions - If you are not on track to max out your retirement accounts, your bonus can help you close the gap. Some employees increase their deferral rate for the rest of the year and use bonus dollars to offset the change in take home pay.

Add to your HSA - If you are enrolled in the high-deductible health plan, HSAs offer deductible contributions, tax free growth, and tax free withdrawals for qualified medical expenses.

Contribute to a 529 plan - 529 plans offer tax deferred growth and may provide state tax benefits. Recent legislation also allows unused funds to be eligible for Roth IRA conversion, creating long term flexibility for your family.

Invest in a taxable brokerage account - If your retirement savings are on track, a diversified taxable account can help you build long term wealth with fewer restrictions.

Prepare for upcoming expenses - Setting aside dollars for known short term goals reduces the need for credit later.

Support charitable giving - If giving is part of your values, you can use bonus dollars to fund a donor advised fund or make direct charitable gifts.

Create meaningful experiences - If your financial plan is on track, consider using part of your bonus for experiences that matter. Research consistently shows that experiences create more lasting happiness than material purchases.

None of us use every dollar perfectly. But when you approach your bonus and LTI with clarity and intention, you give these dollars a job. And that simple shift can change the trajectory of your financial life.

If you ever want to talk through your Cardinal benefits or your own situation, you’re welcome to schedule a relaxed Q&A. No cost, no pressure, and no expectation to meet again — just a chance to talk things through. CLICK HERE TO SCHEDULE 

Take care and, as always, stay the course.