I have a friend who was offered a promotion that would have meant a move to his insurance company's HQ. He knew that the offer meant his manager valued him. But after a long family discussion, he declined the promotion. His boss accepted the decision, and together they figured out how to best use his skills and abilities for the company in this area.
He stayed, ran the auditing office, and made it one of the best in the company. His retirement party was great, with people flying in from offices around the country. Obviously he touched everyone in the company.
Basically, you have an opportunity to show someone that you value them as an employee. At the same time, you allow them to make their own decisions. Above all, it's not your job as a manager to make assumptions about which way an employee will jump, regardless of their home situation.
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