What to do with my shares when I take voluntary redundacy?

luke_ferg

Hi All,

A newbie here, I’ve been a passive reader of the forum for some time and I’ve finally felt compelled to post something! I appreciate this has been probably answered a few times already; however, some up to date advice wouldn’t go amiss.

Here’s my situation:

I’m taking voluntary redundancy later this month and over the past few years, I’ve invested in my companies share incentive scheme. I now have a numbers of options with what I can do with the shares:

• Option 1 would be to cash them in, commission free. I would gain about £8000 from doing this.
• Option 2, keep them and count on the share value increasing over the next few years.

My own logic is telling me Option 2 is the best, I don’t need the money right now and the share value is low at the moment. However, to proceed with Option 2, I would need to setup a share dealing account to manage them. I fear commission when I do eventually sell them, could ruin any potential gain though?

Some advice and recommendations on share dealing accounts to use would be much appreciated!

Luke

CLAPTON

if you would happily invest in these (unknown) shares with your own money today then keep the shares

if you would not choose to invest in these shares with your own money to day then sell them and buy some other shares or save or whatever

le_loup

There is logic in buying shares through an incentive scheme.
Is there any logic in continuing to hold them, particularly if it is a large slice of your savings/investments?
If you were an ordinary Joe, not working for that particular company, would you put a large slice of your money in that company?
Diversity makes sense.

coastline

I paid the maximum into a share save with my employer years ago...107p was the transfer price...
I held them for nearly 15 years...a massive roller coaster ride despite then being a FT100 company...at one point they were double but during the dowturns they were in half..
When I took my redundancy again they collapsed to nearly half what I'd paid...so I decided at the best opportunity to sell...so I did at 1.23p..
Today 8 years later they stand over £8....what a disaster...half a small house down the drain...never mind..

kidmugsy

It's a pity, coastline, that you didn't sell half and keep half.

luke_ferg

The company I work for is BAE Systems. I think in the long run, the shares will increase in value, but of course, as suggested, that money maybe better invested else where...

What share trading accounts would people recommend? I've found X-O which are cheap, but is it as simple as choosing the cheapest? What kind of account would be best an infrequent trader?

le_loup

luke_ferg wrote: »

I think in the long run, the shares will increase in value

Will they?
The only certainty in this world is that in the long run, we will all die.

atush

Would all depend on:

The company (you don't say)
Your other financial situation ie debts, dependants, savings/investments

If it was all you had, i'd sell.

I'd hold if it were a minority in your overall portfolio% and you know you won't be out of work long.

Shimrod

luke_ferg wrote: »

Option 1 would be to cash them in, commission free. I would gain about £8000 from doing this.

I'm not clear from this whether you will be making a profit of £8,000 or the total proceeds of the sale are £8,000.
If your total cash after selling them is £8,000 you might want to consider selling them anyway, putting the proceeds into an ISA and rebuying the shares in that. Simplifies you tax matters and will keep the dividends tax free as well.