I get a 10% discount on my company’s stock. I’m currently investing 2% in the stock program and 6% in my 401k (with a 5% match). I’m also contributing $21 a week to my Roth IRA. It was higher, but I’m trying to save more cash for renting out my investment property. I’d appreciate feedback on whether I should increase my contribution to the stock program, maintain it, or adjust my overall investment strategy.
If it’s an ESPP and you can sell immediately, max it out if you can afford it. A guaranteed 10% return is hard to beat.
My ESPP allows me to sell immediately, and I make sure to max it out. It’s basically free money. If there’s a holding period, though, you might want to be more cautious.
I checked the rules and found there’s a 21-month transfer restriction. I can sell immediately but can’t transfer to another broker during this period. That makes it less attractive, so I might lower my contribution or stop altogether.
If there’s no mandatory holding period, max it out and sell immediately to lock in the discount. Diversify the proceeds into ETFs or other investments.
It depends on the company’s stability and growth prospects. If you believe in the company long-term, you could contribute more. Otherwise, prioritize diversification.
Focus on maxing out your 401k match and Roth IRA before putting too much into company stock. A 10% discount is nice, but ETFs like VOO or QQQ might provide better growth.
Keep in mind the risk of over-concentration in your employer’s stock. Your income and savings would both rely on the same company, which isn’t ideal.
Have you considered reallocating to ETFs or other diversified assets? A company’s stock is riskier than a broad market fund.
The details of the ESPP matter a lot. If you can sell immediately, it’s free money. If you have to hold for 21 months, consider how confident you are in the company’s future.