Redundant - Sell or hold employer shares?

Ifts

Thrugelmir wrote: »

How large a share of your total investments does this company represent? That's a factor I'd consider.

OP says -

It would only represent less than 10% of my portfolio so I could afford for them to have quite a wobble.

kidmugsy

Temrael wrote: »

I could sell the SAYE shares for example (as they are made up of my savings) but hold the ones awarded to me free (as they don't "owe" me anything).

The shares don't care whether you paid for them or not. Give up this absurd line of argument.

atush

Keep some for speculation, like you said 1K. Sell the rest and invest in funds.

The same you have now (vanguard) or something else.

Thrugelmir

Ifts wrote: »

OP says -

It would only represent less than 10% of my portfolio so I could afford for them to have quite a wobble.

10% is a significant % to hold in a single share.

PeacefulWaters

Can you make further sharesave investments for upto six months after redundancy?

BananaRepublic

If you were given them as part of your salary then I think they are taxable as a capital gain, but I am not au fait with current tax rules on shares schemes, hopefully someone more up on the current rules may give you the facts. A redundancy payment is tax free up to a certain limit.

Single company shares are high risk, simply because they are so unpredictable. The company could rocket, but equally something unexpected could turn up and send them down the tubes. The problem is that you just don't know, and neither do they. Most people here hold collective investments such as unit trusts, which spread investments over many companies, thereby significantly reducing risk. If I was in your position, I would sell them, and transfer the funds into a unit trust. If I had a significant holding, I would spread it over several trusts and sectors. Then again, I am not you. I once sold shares in Psion, after leaving the company, after which they rocketed by a factor of 40 or so! I never realised my presence had such a negative impact.:rotfl:That though was a very unusual case, during the dot com boom. I sold shares in another company I worked for, not long before they went pear shaped.

Temrael

Wow thanks guys, a lot to mull over there.

Bowlhead - Amazing as always, thanks for taking the time to reason things out in a clear and easy to digest way.

A couple of things to just respond to...

I don't have any debt at all, or a mortgage to pay down. I'm not doing too badly on the Pension front but yep that would be another option (bunging on a bit of tax relief to boot).

Yep, I believe I can continue to save into the SAYE for 6 months and then make the decision to buy or not later. I guess the only risk is that in 6 months they aren't so far ahead and when I buy, the profit I have locked in (above the cash I saved to buy them with) is smaller.

You are quite right that a lot of this is a false choice. i.e. it's not between cash and these shares. The sensible thing to do (as I put in my OP) would be to cash out then decide how much of it I want invested (full stop) and then put that money into whatever investments I previously thought were right for my portfolio.

And I see what you are saying about the shares I was gifted as opposed to those I have saved to buy in the SAYE. Once I transfer them out or buy them under the option, they are just ...shares (they don't know how they were acquired or awarded). I agree it's a trick of the mind, and that once they are mine they are mine regardless. I still feel a little bit differently about gambling with the shares I was gifted, it feels like "someone else's money" as opposed to mine, I know that sounds silly.

If you and I go to a casino and hit a Roulette table I think I would feel differently about getting £100 of my hard earned cash out of my wallet and betting it on black than if you were to say to me "Here mate, if you want, I'll put £100 on black for you and if it wins, the money is all yours". I know the sensible thing to do is to say, "I'll just take the £100 if it's all the same and we'll skip the Roulette" but there's a bit of me that thinks "Well it's not money I was expecting or thought that I would have, maybe it's worth a shot".

I think I am tempted, as you say though, to limit the amount of these shares I hold on to around £1k. If they pull a Rightmove and go up tenfold in a decade or something I guess that wouldn't be an awful outcome.

Thanks again to all the contributors, you helped get my head a little clearer. I was knew the logical thing to do would be to sell them all and bung them in LS but was minded to be greedy/speculative and that would be all well and good until something unexpected happens.

Oh and grats George. :T :silenced: