The former Middlesbrough man has become a regular in the Watford starting XI but coach Gianluca Vialli has been told to slash the wage bill and Okon could be one of the high-profile names to depart.
"With regards to Paul Okon it is really in the hands of the club at the moment and with the financial situation we really are waiting to see what he can and can't do in the summer," said general manager Terry Bryne.
"I am sure if the club can possibly keep him then they would like to."
Meanwhile, Watford have allowed David Noble to return to Arsenal after a season-long loan spell with The Hornets.
Financial restrictions are thought to have scuppered an extended loan spell and Noble will now return to Highbury to further his development.
