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Employee Stock Options

March 16th, 2008 at 07:18 am

sam's club matches 15% of my stock purchases (of sam's stock). i recently started studying about stocks and even purchased some shares of other stock, but i am not sure about buying into sam's stock. that means i will be having money taken out of my checks going straight into the stocks, sure i will be "making" 15% on whatever i am missing out on, but is that worth the trade off?

would it be better for me to pocket that money and choose my own stocks instead? what do you think? i am having trouble deciding. i love the idea of investing in stocks, but i'm not going to invest into a stock just because i get 15% of it matched. i would choose a stock based on its future potential to grow, and although i work there, i don't see sam's club (or any other wholesaler) doing anything new or innovative that might boost its stock anytime soon.

alot of people say its worth it just to invest because you get 15% more of your money back when you cash out, but isnt there a withdrawal penalty or fee of some sort that would cancel out the 15% anyway? i would have to strike gold on that stock for that to be worth it, it seems.

do any of you purchase into your own company's stocks and receive benefits for doing so?

Posted in Uncategorized | 4 Comments »

4 Responses to “Employee Stock Options”

  1. fern Says:
    March 16th, 2008 at 11:48 am 1205668132
    1205668132

    If your plan is like most 401k plans, not the full 15% of your contribution is matched by Sam's Club. If it is, I would take advantage of it but aren't there are investment choices besides company stock or is that it? Many times i've read that you shouldn't invest more than 10% of your portfolio in your employer's stock because it's not diversfied.

  2. Amber Says:
    March 16th, 2008 at 12:58 pm 1205672290
    1205672290

    I just started investing myself and I agree with fern if it is 15% I would take it
    Good luck

  3. homebody Says:
    March 16th, 2008 at 03:31 pm 1205681484
    1205681484

    Why not take it? Is Sam's Club a dividend stock? That does not mean you can't invest in other stocks too! Diversification is the key, not completely shunning your company stock, in my opinion.

  4. baselle Says:
    March 17th, 2008 at 12:53 am 1205715227
    1205715227

    If you can only purchase your company's stock with the 401K, I would do the minimum to get the match, then look at other options like a traditional or Roth IRA. I'm not saying that Sam's Club is like Enron, but Enron was a lesson that you really want to look at your portfolio as a whole and keep it diversified. A good suggestion is to keep no more than 10% of your net worth in your company stock.

    You can really learn a lot by picking your own stocks, I have fun with mine ... and it makes me really want to read the financial sections in the newspaper, but I also have a lot on index funds, some in bonds, cash, t-bills. That way I keep the risks of picking individual stock low (for me).

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