Conference nyoss1::market_investing

The Wall Street Journal carried a report in late summer stating that 86% of
those companies with 401k plans did some level of matching.

						Trace

    Among other things we have a pension plan.
    
    John
    

re                      <<< Note 634.0 by ODIXIE::MURDOCK >>>
                           -< Dollar matching..?!? >-

>    Why is it that Digital doesn't match SAVE investments...?!?!
 

For one, we have the ESPP.  Every employee, IMO, should take advantage of
ESPP if they can afford it.  

    I recently read an article in Worth or Fortune comparing 401K plans of
    large companies.  It showed how much someone with a $65K salary could
    accumulate over time by using their 401Ks to the max.  Digital wasn't
    on the list, but if we were we would have been at or near the bottom. 
    Our plan is pitiful in comparison to most others.  I didn't really
    believe this before, thinking some people complain about everything.
    But I believe it now!

    re: .3 I saw that article to, it must have been in Worth because I
    don't get Fortune.
    
    I was also surprised at how poorly our plan would have rated.  At or
    near the bottom of the list is not an overstatement, since most of
    the other plans did offer matching contributions.  About the only thing
    that they could have said good about our plan was that it has no
    requirement, in fact, no option, of investing in company stock - which
    they do not recommend for retirement plans.
    
    They did chide companies that required matching contributions to be
    invested in company stock.  I didn't think this was to bad a
    requirement.  It's much better than nothing.  Note that I do agree that
    now is not the time for the company to start matching, but I think that
    could up the minimum percentage.  Ours (8%) is extremely low by
    comparison.
    
    Most of these companies also had pensions, many had stock plans.
    
    Wayne
    

    
    Re: .3
    
>For one, we have the ESPP.  Every employee, IMO, should take advantage of
>ESPP if they can afford it.  
    
    Question on this:  I've been an employee for about 8 years now.  I stopped
    my ESPP contributions about a year ago after taking a close look at my
    holdings.  I'm sure that I'm not in a unique position, but I have
    shares that were bought at ridiculous prices (compared to today's
    price) like $180, $150, etc.  Today it's valued at - what - $36?
    
    I can see some advantages to my contributions, in retrospect.  I can
    sell some of the stock before 12/31 to take a loss, offsetting my
    cap.gains in other investments.  (Is that a good idea?)  Or, I can do
    same and invest the proceeds in a more profitable area.
    
    On the other hand, if one contributes and then sells right after a
    purchase, you can get at least 15% off the investment, but then you'll
    get snapped for short.term.cap.gains, making the effective yield...
    minimal.
    
    Am I looking at this properly?  I'd like to know why you consider the
    ESPP so worthwhile.  Frankly, I'd rather take the same amount and roll
    it to one of my funds that is doing a 20% (or better) return.
    
    Bob
     

    Date and/or volume/issue #?

    re: .6
    
    If you buy/sell immediately through ESPP and take the quick 15% you
    are still well ahead, even paying the additional income taxes (*not*
    short-term gains, except for the potential change in share price during
    the day between when you buy and when you sell).  It is essentially
    "free money".
    
    If you earn $50K/year, put 10% = $5000 in per year, selling immediately
    should mean about 15% of $5000 or $750 in additional income with 
    little risk.  In DEC stock goes up during one of the two periods then
    you can do significantly better.  I don't think one could find a better
    investment from a risk/reward perspective; I'd put 100% of my paycheck
    into ESPP if they'd let me!
    
    Buying stock through ESPP and holding it long term is an altogether
    different story.  That should involve deciding if you believe DEC is a
    good investment relative to other potential investments.

I think that we will see Digital start matching contribution within the 
next year if it's to remain a competitive employer. Digital is 
finally waking up to that fact that our comp program is poor, and I'm
glad to hear it publicly announced.  Our outdated life insurance was finally
changed, and I'm guessing that they will fix our 401K/retirement program
soon.  

I think Digital always held that the Pension and 401K was sufficient.

I know LOTS of companies that match $ to $ for up to 5% and 8% of pay!
Imagine what that pot would look like?  Oh yeah, I have a pension.... :*(

-Brian

re       <<< Note 634.6 by KYOSS1::HANSON "Just doin' what makes sense." >>>
                          -< Whyfor do you say this? >-

>    On the other hand, if one contributes and then sells right after a
>    purchase, you can get at least 15% off the investment, but then you'll
>    get snapped for short.term.cap.gains, making the effective yield...
>    minimal.
 
Ok, you make 15%, which isn't always the case mind you.  Say you pay 40% on 
the gain to taxes.  You are still left with 9% for your pocket.  Where else
are you going to get 9% on your money with what I consider to be fairly
low risk?  If you hold your stock, then the risk increases because now you're
speculating the stock will go up.  And, if the stock is on an up-trend, you
stand to make a lot more then 15%!

>    Am I looking at this properly?  I'd like to know why you consider the
>    ESPP so worthwhile.  Frankly, I'd rather take the same amount and roll
>    it to one of my funds that is doing a 20% (or better) return.
 
sell you espp shares immediately then roll'em into your fund.

    People, please ...
    
    Investing in Digital is discussed in NYOSS1::DIGITAL_INVESTING .
    This de facto includes ESPP and SAVE.
    
    Corporate compensation is best discussed in HUMANE::DIGITAL (but node
    moving to MRO this weekend). There is plenty of such discussion there.
    
    Let's try to keep those discussion topics out of this conference.
    I'm more concerned with possible future notes than previous comments.
    
      John (moderator)