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Advice on savings...

Frequent Contributor

Advice on savings...

My wife and I have been making great strides in our finances after years of overcoming debt.  We are now in a position that I didn't think we would be in for some time -- debt free. 

We shoud have a good amount left over at the end of each month for savings.  We already have an emergency fund, and monthly budget towards different categories like a 6-month car insurance fund, vacation fund, new car fund etc. 

With the extra money leftover (the point of the topic) I have an option to put up to 20% of my paycheck towards company stock and get a 5% discount.  However, I already have quite a bit of stock built up with my employer (around a third of my stock holdings is company stock).  Should I add to the amount committed to this program, or should I diversify by buying other stocks, etfs or mutual funds outside of the employer program?  A 5% discount from a great employer is great, but I'm concerned about having too concentrated of a position.  Any thought would be appreciated. 

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Message 1 of 7
6 REPLIES
Moderator

Re: Advice on savings...

Hi @graath, your duplicate post in Personal Finance has been removed.  Please avoid cross-posting in the future; it's confusing to follow and is against our guidelines here. Smiley Wink

 

--UB

Message 2 of 7
Regular Contributor

Re: Advice on savings...

Yes, diversify, imagine your company having future financial trouble, you don't want to be all in entirely. Employed and invested is a huge leap of faith in any company thats not your own.

 

I suppose it would also depend on some serious number crunching if you wanted to get deep, but i'll leave that up to you


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Message 3 of 7
Valued Contributor

Re: Advice on savings...

Op, I'm not heavy in knowledge of the stocks game, but I like the thought of diversifying, if possible. It just seems like for your scenario, it gives you more flexibility and options. On another note, great job getting out of debt and saving money the way you are!
                                            

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Message 4 of 7
Highlighted
New Contributor

Re: Advice on savings...

Congrats on being debt free and in a position to save. Leftover $$ have a tendancy to slip away. I respectfully suggest that savings be made a budget item -- the first one if possible.  Pay yourself first!

 

Investing is fun. There is a lot of reading material to help you along the way. 

 

Good luck!

Message 5 of 7
New Contributor

Re: Advice on savings...

holding period, fees, and taxes to consider, but you could of course sell to avoid increasing your exposure

Message 6 of 7
Valued Contributor

Re: Advice on savings...


@graath wrote:

My wife and I have been making great strides in our finances after years of overcoming debt.  We are now in a position that I didn't think we would be in for some time -- debt free. 

We shoud have a good amount left over at the end of each month for savings.  We already have an emergency fund, and monthly budget towards different categories like a 6-month car insurance fund, vacation fund, new car fund etc. 

With the extra money leftover (the point of the topic) I have an option to put up to 20% of my paycheck towards company stock and get a 5% discount.  However, I already have quite a bit of stock built up with my employer (around a third of my stock holdings is company stock).  Should I add to the amount committed to this program, or should I diversify by buying other stocks, etfs or mutual funds outside of the employer program?  A 5% discount from a great employer is great, but I'm concerned about having too concentrated of a position.  Any thought would be appreciated. 


Can't you sell company stock you have purchased? If yes consider selling existing stock and purchasing other equities, mutual funds and bonds. Then you can continue taking advantage of the 5% discount. As time goes on rinse and repeat. [Is therere some minimum time duration for selling shares you purchase at a discount?]

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Message 7 of 7