Does it make sense to do this?

Stillsmiling

I can join a share scheme at work where I pay a percentage of my salary into it and 6 months later I cash the shares in and am guaranteed 15% profit - more if the shares go high enough!

BUT, we're on a debt management plan and every penny is supposed to be paying things off and letting us live.

So do I do this (the 15% is guaranteed so I can't lose money) or do I leave it for now and join it later when things are financially better?

rayday2

We are on a DMP and hubbys company has just been taken over by BT who offered there share scheme. We have no pension for the future so I said go for it, we buy only £20 a month but that gives us some tax relief and over the years we build shares up.

Do you have to cash yours in every year or can yours build as a nest egg?

Stillsmiling

You can build it but I've been told it's better to cash it so you make the 15% back straight away - kind of a short term savings plan.

There is a longer term option too but there is risk involved in that and I don't want risk at the moment!

postingalwaysposting

ss ~ i think its personal opinion. How much of what you will save will be taken away from your living expenses? Will you need to cut back on food etc to be able to afford to do this?

Stillsmiling

I don't think so as the plan covers dh's basic salary and he gets overtime each month. As the overtime is variable (he gets called out) then it can't be included in the DMP.

postingalwaysposting

Stillsmiling wrote: »

I don't think so as the plan covers dh's basic salary and he gets overtime each month. As the overtime is variable (he gets called out) then it can't be included in the DMP.

So the share scheme money will come from all the overtime. As long as this isnt cut then i dont see a problem in doing this. It will also help you save as it will be taken out of the wages before they hit your bank, that way wont notice it too much. I would look into it first though before you jump into anything.

Stillsmiling

We're going to review it tonight but I'm thinking of just doing 1% and seeing how it pans out. I can always increase it next time.

Thanks for your help

postingalwaysposting

Stillsmiling wrote: »

We're going to review it tonight but I'm thinking of just doing 1% and seeing how it pans out. I can always increase it next time.

Thanks for your help

well thats it 1% i am guessing isnt much compared to you wages but it soon build up. Say you give £100 to share save that £1,200 a year + 15%, its better than most savings acccounts you can get now. Plus as you say you can always increase it if need be... Good luck with your debt free journey...

DaveJH

Hi Stillsmiling,

I have the same scheme where I work, the problem is the shares are priced in US$. They also used the 15% profit to sell it to us, but remember if the shares are not in £ then you need to take the exchange rate into account.

I was thinking of leaving the scheme a few months back but decided to stay with it as the £ to $ rate was very good. I've just had to take a hit on the exchange rate from $ to £ though as I needed to sell some shares to pay a CC Bill, profit is still over 15% though as I've been holding the shares a while.

deliciosa

I have the same thing but we cant touch it for 3 years. I am not struggling with debt at the moment , i pay back more than minimum, but i have debt and i will hae it for another year or so if i want to be realistic. i look at the share saving scheme as a kind of thignthat enforces savings. otherwise i would spend it! this way i cant. how nice it would be in three years' time when i get a nice lump sum. i say go for it, you can only win.

CCCS_Alan

Hi Stillsmiling

If you are on a DMP you should ideally be aiming to be debt free as quick as possible. If your DH’s is receiving overtime you may want to be looking at saving it up for 3 months keeping a little back for a treat and paying a lump sum onto your DMP to get rid of your debts that little bit quicker.
Once you have cleared your debts you could then pursue the share shave schemes and any thing else you wish to indulge in.

Regards

CCCS_Alan