The Pros and Cons of Owning Stock Where You Work

SHJ082916_Owning_Stock_Where_You_Work_Blog_ImageMany companies offer stock options and stock bonuses to their employees, but is owning stock where you work a good idea? The short answer: it depends. Below are our thoughts on the pros and cons of owning stock where you work.

PROS
One ‘pro’ to owning stock in the company where you work is the added motivation you have for the company to succeed. As an ‘owner’ in the company, your success is tied to their success. This holds true for the employees you manage as well.

More than the incentive to work hard, owning stock in the company you work for can pay off quickly. Often companies offer their stock at discounted prices to employees. Buying stock at a discount can pay off if the company does well. In general, you may want to limit your company stock exposure to 10% of your net worth (or less) to maintain diversification.

CONS
Your paycheck is already tied to your employer and tying more of your investment portfolio to the company where you work could significantly increase your risk. While being motivated to help the company grow can positively benefit your investment, it doesn’t mean the company is destined to be successful. Their downfall can mean a big financial loss for you. Remember General Motors, Enron and Lehman Brothers?

THE BOTTOMLINE
Owning stock in the company you work for can be a beneficial part of your financial plan. Talking to your financial advisor before making a decision to invest where you work is a good idea. Call 303-639-5100 for a complimentary consultation.

Inside the Economy with SH&J: August 1, 2016

July wrapped up with a nice rally in the U.S. markets, proving that summer can be a productive season in your investment portfolio. Today’s discussion brings our attention to U.S. GDP, the bond markets, and the emerging markets. Listen in to find out which two emerging market countries are projected to be the fastest growing in 2016!

Will Millennials Ever Retire?

“60% of Millennials think it is harder to plan for retirement than to stick with a diet and exercise plan.”

Will Millennials Ever Retire?

One word sums up how Millennials tend to view planning for retirement: overwhelming. This is a very clear conclusion from this 2015 survey, which reveals attitudes about retirement in the U.S. You can easily guess why Millennials feel this way: soaring student debt, increased cost of living, stagnant wages for college graduates, and a lack of confidence in Social Security and the stock markets.

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How to Responsibly Handle Your Tax Refund

Tips to responsibly handle your tax return.

It’s tax season and for almost 80% of Americans, (source) a refund check may be in the mail. It’s easy to view a tax refund as free or easy money, but remember you worked hard to earn that money. Using your tax refund responsibly now can assist in reaching your financial goals in the future.

Here are 8 suggestions for using your tax refund responsibly:

Top Off Your Emergency Fund
An emergency fund is an important part of any smart budget. If your emergency fund has been depleted recently, think about using your tax refund to top it off. Depending on the circumstances, we typically recommend having an emergency fund that covers three to six months of basic living expenses.

Build Your Investment Portfolio
Consider using your tax refund to add to your investment portfolio. Talk to your Certified Financial Planner® about how to allocate your tax refund dollars amongst your investments. Continue reading