Author Topic: How to factor in ESOP into retirement planning.  (Read 526 times)

thorbjorn88

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How to factor in ESOP into retirement planning.
« on: March 20, 2017, 04:31:36 PM »
I'm just leaving college with a master's in electrical engineering and $9,212.13 in student debt (not perfect but MUCH better than many of my classmates.) I'm starting a job in June at an employee owned company that has an ESOP. They match 4% into my 401k, provide up to 5% discretionary into the 401k (I'm told it's been 10 years since it was less than 5%) and they put 9% into the ESOP. I'm starting out 100% vested. My question is how do I factor in the ESOP into my retirement planning? How do I find out what kind of interest rate it has averaged historically?

eudaimonia

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Re: How to factor in ESOP into retirement planning.
« Reply #1 on: March 20, 2017, 05:40:27 PM »
The key question you'll need to ask your employer is what is the ESOP invested in? Typically ERISA laws dictate a high fiduciary care of ESOP accounts. For the company I work for, our ESOP dictates that the funds are put into a low cost set of well diversified index funds as well as some company stock (about 20%). So rates of return for our ESOP are comparable to a balanced 60/40 stock/bonds account over all. For your company it will depend on what the ESOP invests in.

thorbjorn88

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Re: How to factor in ESOP into retirement planning.
« Reply #2 on: March 20, 2017, 07:49:58 PM »
Awesome thanks!

PDXTabs

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Re: How to factor in ESOP into retirement planning.
« Reply #3 on: March 20, 2017, 09:50:57 PM »
I've only worked one place with an ESOP and 100% of the ESOP was company stock that I couldn't sell until I was 55 or left the company.
When the alien resides with you in your land, you shall not oppress the alien. The alien who resides with you shall be to you as the citizen among you; you shall love the alien as yourself, for you were aliens in the land of Egypt. - Leviticus 19:33-4