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What to do with a large share save scheme/

I work for Sage (LON: SGE) and have a long running share save scheme that matures on 1st August.
I've been paying in £300 a month for 60 months, with an option price of 456p, giving me 3947 shares. At this mornings price of £6.70, that makes it worth £26,400.
My long term aim is to use this money to allow me to semi-retire to a part time job in 10 years, however, I'd like to keep the funds semi-accessible in case of job loss (Already an EF in place means this would only be incase of long term job loss, rather than a month or three) I've only put £2500 into my S&S isa this year so far, so there is some room in there, but not enough for the full amount.
The share price seems low at the moment, prices of £8 were seen recently, and this doesnt seem the ideal time to sell. 
What does the combined brains of MSE think I should do?


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Comments

  • ARH_2
    ARH_2 Posts: 109 Forumite
    Tenth Anniversary 100 Posts Combo Breaker
    Well done sticking at your share save. 

    I find holding shares in the company one works for a bit odd. Clearly it makes sense when the employer is putting a (c.20-25%) bonus on the table. After it matures, however I'd argue it makes no sense to hold. In my mind, you're already 'long' on the company by working for it - if it fell on hard times, you'd lose out through pay rises, bonuses or even losing your job. Adding to that long position through voluntarily holding shares - unless there's a big incentive - makes no sense in my mind. Further, most of your investments being a single company is a poorly diversified portfolio. Therefore, sell ASAP. 

    Now the question becomes: what to do with £26,400 in cash.  With the usual background required being age, risk appetite etc. As a starter, filling your Stocks and Shares ISA seems like a good move - possibly something cheap and diversified like vanguard life strategy, or perhaps a few investment trusts that take your fancy.

    Making additional pension contributions may also be a tax efficient answer, particularly if you're a higher rate tax payer and not miles from retirement age/your lump sum. Depending on your age and salary, I might propose you make additional pension contributions to get yourself down to the higher rate tax threshold. 
  • Hi,
    usually these share save schemes are offered every year, so do you have any others running?
  • Hi,
    usually these share save schemes are offered every year, so do you have any others running?
    I have a second 24mo into a 36mo @ £200 per month. I'll also start another at £300 next month (£500 is the max total scheme payment)
  • ARH_2 said:
    Well done sticking at your share save. 

    I find holding shares in the company one works for a bit odd. Clearly it makes sense when the employer is putting a (c.20-25%) bonus on the table. After it matures, however I'd argue it makes no sense to hold. In my mind, you're already 'long' on the company by working for it - if it fell on hard times, you'd lose out through pay rises, bonuses or even losing your job. Adding to that long position through voluntarily holding shares - unless there's a big incentive - makes no sense in my mind. Further, most of your investments being a single company is a poorly diversified portfolio. Therefore, sell ASAP. 

    Now the question becomes: what to do with £26,400 in cash.  With the usual background required being age, risk appetite etc. As a starter, filling your Stocks and Shares ISA seems like a good move - possibly something cheap and diversified like vanguard life strategy, or perhaps a few investment trusts that take your fancy.

    Making additional pension contributions may also be a tax efficient answer, particularly if you're a higher rate tax payer and not miles from retirement age/your lump sum. Depending on your age and salary, I might propose you make additional pension contributions to get yourself down to the higher rate tax threshold. 
    Would you sell straight away, or hold for a little while longer until the price wanders back up towards £7? 
    I'd agree on not holding long term. A friend of a friend was majorly long in Northern Rock when it went pop in 2008 and lost all his life savings. The £26k represents about 25% of my post tax savings, a large amount for a single company, especially the one I work for. 
    I'm 41, and I've just reduced my pension contributions to 10% + 10% employer match, as it's looking fairly healthy for retiring at 58. 
    I think I may keep the remaining £9k as cash as until we ride out the back of the imminent recession. It's not going to earn more much, but it will provide security, especially as there is now a new minime in the house.
  • eskbanker
    eskbanker Posts: 35,261 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    NorthernMonkey1 said:
    Would you sell straight away, or hold for a little while longer until the price wanders back up towards £7? 
    Is that just blind optimism or do you have a rational explanation for your apparent belief that it'll head towards £7 rather than £6 (or £5) in the short term?  The fact that it's been £8 in the recent past doesn't in itself signify that this is where it 'should' be, and there will be reasons (priced in by the market) that it's now lower than that....
  • steampowered
    steampowered Posts: 6,176 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    edited 7 July 2020 at 10:56AM
    If you had £26,400 in cash, would you invest it all in Sage shares?

    If the answer to that question is "no", then you shouldn't keep the shares. The best advice is likely to sell your shares at the earliest opportunity and invest the money instead in a globally diversified multi-asset fund.
  • coastline
    coastline Posts: 1,662 Forumite
    Part of the Furniture 1,000 Posts Photogenic Name Dropper
    edited 7 July 2020 at 11:21AM
    I've been through this years ago where my company shares went nowhere for well over decade. Unfortunately I decided to sell and then watched the shares rocket 10 times. Hold some and sell some would be one way of thinking.
    As far as I'm aware you can request to buy the shares at the given price and then transfer into a S&S ISA. If you have around £17,500 left for this year then you'll only be able to transfer part of the holding until your next ISA allowance.
    https://www.charles-stanley.co.uk/group/cs-live/transferring-saye-shares-isa
    What to do ? All up to yourself really. You might be more comfortable with a global tracker in your S&S ISA instead so sell your holding inside the tax wrapper.?  Plenty company forecasts on financial websites. 
    https://www.share.com/investments/shares/14594/sage-share-price
    https://markets.ft.com/data/equities/tearsheet/forecasts?s=SGE:LSE
  • milton1970
    milton1970 Posts: 191 Forumite
    Part of the Furniture 100 Posts Name Dropper Combo Breaker
    Watch out for taxable gain if you sell - obviously you can use annual tax free allowances.
    Best approach may be to transfer as many shares as possible into your S&S isa (avoid using annual contribution allowance in short term) - if an approved scheme you have 90 days from maturity to transfer in. 
    That way you can use the annual CGT allowance for the residual not transferred or leave outside the S&S isa.

    Just thoughts 

  • Notepad_Phil
    Notepad_Phil Posts: 1,448 Forumite
    Fifth Anniversary 1,000 Posts Name Dropper
    edited 7 July 2020 at 11:29AM
    My long term aim is to use this money to allow me to semi-retire to a part time job in 10 years, however, I'd like to keep the funds semi-accessible in case of job loss
    I'd suggest that if you did lose your job then the company was doing poorly and so the share price may well have fallen from its current price - hence if you want to keep this money in case of job loss then I'd definitely move the money to something other than your company's shares.
    I remember 25 years ago a lot of people being made redundant from the large multi-national company that I worked for (me included) - unfortunately a lot of them had kept much of their personal wealth in the company's shares and had to take a big hit to their wealth at the same time as being made redundant.
  • milton1970
    milton1970 Posts: 191 Forumite
    Part of the Furniture 100 Posts Name Dropper Combo Breaker
    As said above - you may choose to still sell post transfer .. point was really how you may take advantage of 90 day transfer option to minimise tax & give options.
    If sharesave managed through Equiniti (many are) I would also recommend transferring all out to avoid expensive selling fees 👍
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