Safal Niveshak

Wit. Wisdom. Value Investing.

You are here: Home / Archives for Financial Planning

Financial Planning

Investing in Your Company Stock? Look Before You Leap

We recently discussed why too much love for your company could be disastrous for your financial future.

We looked at lessons from Enron and our very own Satyam where employees who invested in their company stock saw their savings go down the drain.

We also studied why even when your company might not be the next Enron or Satyam, you must not go overboard with your investment in its stock.

But we also suggested that you may have 5-10% of your financial investments invested into your company stock.

Now the question you may have is this – “How do I know whether my company’s stock is worth buying?”
[Read more…] about Investing in Your Company Stock? Look Before You Leap

Why Too Much Love for Your Company Can Be Disastrous for Your Finances

If I were asked to give you the 10 commandments in financial planning, “Don’t buy too much of your company stock” would be right up there.

Nearly a decade after the collapse of Enron Corporation in the US, many employees still haven’t learned one of that episode’s clearest lessons: Don’t bet your nest egg on the place you work.

Enron employees certainly learned the hard way: Nearly two-thirds of their retirement money was invested in the company’s shares, which became worthless. Imagine yourself in their situation and seeing your stocks drop by 99% in a flash of a moment.

But Enron didn’t teach employees a lesson. Worldcom and Lehman Brothers workers suffered the same fate. They also saw their retirement dreams disappear along with their jobs.

In India, employees of Satyam Computers who bet their retirement money on their company’s stock faced the same issue. Everything disappeared before their eyes! [Read more…] about Why Too Much Love for Your Company Can Be Disastrous for Your Finances