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