No don't sell. Your only 25, now is the time to take on a little more risk. When you're young and just starting to invest, you need to look at more growth-oriented vehicles. If you invest at a young age, you enjoy the benefit of what Albert Einstein described as the most powerful force in the universe: compound interest. As you get older scale back the risk.

Ricochet is correct , time is on your side , dont wait till its difficult to save ,
now its easy for you , you have many years for your money to make money.
you are blessed with youth , use it to your benefit , that could be a nice down payment
on your dream home in the future , when your ready to settle in.

I would say absolutely not UNLESS, your going to reinvest that money into a more stable company with a solid dividend that you feel will outperform your current company you own stock in.

Thanks for your valuable answer

I think I’m going to have to respectively disagree with some of the previous advice. It is great that you are getting both a 401 (K) and stock options at such a young age. Being young does allow you to take more risks and invest more aggressively in growth oriented stocks because you have plenty of time to ride out any market fluctuations. The only concern I have with your situation is that you are too heavily invested in only one company.

You pretty much have all of your eggs in one basket – your income, your options and your retirement. If your company goes under you could lose it all in one shot. I think you need to divest some of the stock you have in your company and invest in other high growth stocks or funds. If you have the options in your 401(K), I would suggest allocating or transferring some of your funds from your company stock into one or two high growth or international mutual funds. This way you can still benefit from starting young and generate solid returns from riskier investment vehicles, but your entire future will not rest on the fortunes of a single company.

The reason I think you should keep the options from your company but sell your company’s stock that is in your 401(K) is to lessen the impact of taxes. Since 401(K) earnings are tax free until you cash out, you can move money around within the 401(K) without penalty. If you just hold onto the stock options and cash them in when you retire, you might be in a lower tax bracket then so you will lose less to the IRS.

Thank you for answering me

You can sell it but make sure you are vested first. That means you must have worked for the company for a certain amount of years. It can be 3 or 5 or 7 depending on the company policy.

Thank you sir

Do you know if they expire? The ones I had received from my company had an expiration date. If not exercised(cashed out) I would loose the money. Also what happens to the options if you leave the company?

I am going to go againt the above trend I would say find the right time then sell. In ten years I have seen my comany stock go from 25 dollars to a high of almost 60. The current price is 22 dollars. So in ten years it would have been a 3 dollar loss.

If you have no other investments, you should sell it. Unload the stock while the price is decent, even if there's room for further growth. You can always keep some shares, if you feel confident about them, but try to keep them down to no more than 10% of your total investment portfolio.

Take the cash you get and set up a balanced retirement account. Look to providers like Vanguard, Fidelity, Charles Schwab, or T. Rowe Price. These top mutual fund companies give you enormous offerings for an IRA. Alternatively, look into your company's 401(k) plan.

Trying the 401(k) is actually the best way to get started with investing. Contribute whatever you can, ideally up to any match the employer may give you for dollars you contribute. If this is a traditional 401(k), then you can accumulate up to $16,500 per year in this tax deferred account.

Going with the employer sponsored plan may even give you a chance to take the cash from selling the stock and roll it into the retirement fund without paying taxes. Otherwise, you may need to save some of the money to cover your tax bill. Leave whatever stock you decide to keep alone, but continue to monitor it and factor it into any calculations made when selecting funds to hold in a 401(k) or IRA.

Sell some of your stock and diversify. You don't need to have all of your eggs in one basket, even if you think your company is the next Microsoft. You're probably too young to remember, but this is exactly what happened to empoyees at Enron 10 years ago. It suddenly came to light that they had been cooking the books, the stock plummeted to earth (then burrowed another two miles underground). The worst thing was that - if I remember correctly - employees weren't allowed to sell the Enron stock they had in 401k's or exercise their stock options. Long story short, a lot of long-time employees were financially decimated.

I believe the general rule of thumb is to have no mor than 1/4 of your money invested in your employer's stock. Maybe you want to be aggressive and push that to 50%. regardless, I'd diversify my holdings if I were in your position.

I don't think you need to sell and spend the money, but I do think you need to diversify your portfolio a little bit. It's not wise to have all of your eggs in one basket, as a lot of people learned, unfortunately, from the Enron debacle. Sell some of your employer's stock and buy something else: Coca-Cola, Pepsi, Microsoft, what have you. Just get some diversity so that if your employer suddenly goes down the tubes (and it can happen almost overnight), you waon't have to watch your savings perform a disappearing act.

I agree with modough on this one. If the worst happens and your company has a bad quarter year or whatever then you face a double whammy. You could not only face the prospect of possibly getting laid off at the same time that your shares are becoming worthless if your company goes bankrupt. So I would like to see you hold no more than say 10% in any one stock especially the company you work for since it's also tied to your income. Because if you were to be laid off that's where you would go to support yourself first to your stock account and if it's full of company stock then it's worthless and you can't support yourself.
How about this sell half of the company stock and dollar cost average into say the Vanguard Total Stock Market Index fund it's a great fund with a cost basis of about .02% and it owns the total market about 5000 stocks so it's well diversified. But don't buy any fund all at once dollar cost average over several months. Then as you get more company stock sell half each month and invest more into more funds. That fund is just an idea for a starting point. It's really great that you are asking these questions.

Definitely not, you don't want to sell until you are sure they are going down in value, but sense the stock market is a guessing game, I guess it would be better to sell half now and put into gold and watch that investment grow. This way you will have a "sure thing" in gold that can be set aside for retirement and the rest can be sold. There really isn't any investment that compares to gold in terms of long-term growth expectations.