I am about to accept a job with a company that has a 30+ history. The retirement plan is an ESOP. They do offer a 401(k) but there is no company match. Has anyone had any experience with an ESOP company? If so, what did/n't you like about it. Thanks.
ESOP vs 401(k)
- Thread starter tymr
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maryannette
Wise One
I worked for an ESOP (100%) for 8 years. I know they are not all set up alike. I earned stock value while I worked there. They also had match for 401k. We had a good benefits package. I cannot "cash in" my stock for a few more years. I just left a year ago. It hopefully will increase in value between now and then.
What I didn't like was that it was becoming corrupted by a small group of greedy people at the top who managed to manipulate some of the policies to give themselves an unfair advantage. That really had nothing to do with the ESOP. Just know that it can be good, but can also be full of corporate corruption. One thing to look at is the Board of Directors, how they are chosen, and how much voting power individuals have.
Good luck.
What I didn't like was that it was becoming corrupted by a small group of greedy people at the top who managed to manipulate some of the policies to give themselves an unfair advantage. That really had nothing to do with the ESOP. Just know that it can be good, but can also be full of corporate corruption. One thing to look at is the Board of Directors, how they are chosen, and how much voting power individuals have.
Good luck.
Wolverine
Uncanny Pompadour
Do not not not forget to diversify, hello Enron. You might give up some gain, but you will also be mitigating risk.
There is one large employee-owned I know of that I wish would go public because I would love to have a piece of it. Awesome company, very successful, very innovative - there is no way this company can fail. There's also no way I would put more than 10-20% of my life savings into them no matter how awesome they are. Things happen.
EDIT: one more thing for anyone under the age of 30 - max out your 401K contributions now. Just do it. Trust me. It'll only hurt a little in the beginning, and then you can scale it back in 10 years if you want.
There is one large employee-owned I know of that I wish would go public because I would love to have a piece of it. Awesome company, very successful, very innovative - there is no way this company can fail. There's also no way I would put more than 10-20% of my life savings into them no matter how awesome they are. Things happen.
EDIT: one more thing for anyone under the age of 30 - max out your 401K contributions now. Just do it. Trust me. It'll only hurt a little in the beginning, and then you can scale it back in 10 years if you want.
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G
Guest
Wolverine
Uncanny Pompadour
Depends on your mental age. I'm just now in my late twenties, and that's only because I aged twelve years in the last two (compared to aging two in the previous ten). But it's never too late to begin the quest for millionaire status if you're willing to think in decades.
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Chucktown PE
Well-known member
We have an ESOP & 401(k). We're employee owned so the company match portion of the 401(k) buys company stock. We can unload it whenever we want.
Thanks. I have been working for the company for three months already and have a six month agreement with them. The job is mine I just have to accept it. I picked up in the Employee Manual that the ESOP is top heavy. It's a reputable company, and I'm not concerned about the BoD right now.....but 10-15 years from now it could be different story.
Yeah, I'm not too crazy about one stock retirement either but if that's all there is then I have to look long and hard at it. As near as I can tell the ESOP is more like a pension - no employee contribution and no choice in fund(s). I have decided not to contribute to the 401(k) because I have a great Roth IRA. I figure I'll stick my 15% in there instead of a no match 401(k).
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