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I have worked for a true privately owned ESOP (Employee Stock Ownership Plan) company for 21 years. I am 57 and I just transfer/diversified 25% of my ESOP stock into an IRA account. I am leaving IRA with the same investment managers of ESOP account for the sake of ease. I am eligible in making 3 more yearly diversification, 25%, 25%, and 50%. Each diversification can be up to 25% of the remaining amount, and 50% the last year. My ESOP stock is not publicly traded and valued once a year. It increased in value 8% last year. Each year our company deposits a percentage of our gross income depending on how much our company makes. Last years, 2025, contribution to the ESOP was 11% of my gross yearly income.
I was conflicted on whether to diversify or keep it in the ESOP. We did extremely well during COVID. One year our ESOP stock went up in value 27%, and the following year it went up 48%! Getting close to my retirement years I feel I need to take out as much as I can out of the ESOP before it gets locked up for 5 years. It’s my understanding that what ever is left in the ESOP at retirement will be untouchable for 5 years. I would like to retire at 60, or no later than 62.
Any advice on future diversifications? It’s scary because it’s real money. Is anybody in a similar position, what did you do? Thanks guys -George
I was conflicted on whether to diversify or keep it in the ESOP. We did extremely well during COVID. One year our ESOP stock went up in value 27%, and the following year it went up 48%! Getting close to my retirement years I feel I need to take out as much as I can out of the ESOP before it gets locked up for 5 years. It’s my understanding that what ever is left in the ESOP at retirement will be untouchable for 5 years. I would like to retire at 60, or no later than 62.
Any advice on future diversifications? It’s scary because it’s real money. Is anybody in a similar position, what did you do? Thanks guys -George