More of a WWYD - regarding these Shares?

[BeachBlondey]

Back in the early 2000's, me and my then DH were doing very well financially, and over the course of the previous 10-15 years, we had invested in staff Share plans with our employer Nat West. The schemes allowed you to pay monthly and then at the end of 5 years, the shares you received were usually worth way more than you had invested. Anyway, at one point they were worth circa £100k.

In 2008, there was obviously a market crash and me and DH also divorced. My half of the shares ended up being worth something like £5000, instead of the £50,000 they should have been worth.

I went through some really tough financial times after our split, because he was the high earner. I was only part time, on a low salary, and now my shares had crashed as well. I had 3 years of paying half of the mortgage on the old house (the marital home) that we couldn't sell, plus a new mortgage on a new much smaller home. All food was put on to credit cards and we had no treats. It was quite tough, but I held on to the shares, believing that they would bounce back eventually, and I might have to wait decades for this to happen.

Now we are 15 years on from that time. I have remarried and recovered financially. But, I still have these shares and I don't know what to do now. At one time I believed on this company SO much, because I worked there and the shares had been my only way of saving for so long. But I haven't worked there now for 10 years and maybe the blinkers are slipping.

The shares are now worth about £8,000 and I don't know whether to just throw in the towel, in case they fall again, or sit on them for the next 20 years hoping for some improvement (but can't see them ever getting back to their real value).

I am a risk averse person, and if I had £8k sitting in my bank account, there is no way in a million years that I would buy shares with that! The only reason I got involved in shares in the first place, is because they were staff plans and risk free.

WWYD? I do not need the money now. I would be selling them to avoid more losses. But of course, once I've sold them, I have to acknowledge that I have lost £42k, with no chance of changing that.

YANBU - sell the shares now in case you lose further

YABU - you don't need the money now, so hold on to them

Thanks for reading, sorry it was long!

If you don't need the money definitely keep them and see what happens

I presume they peaked some time before the 2008 crash?

Highly unlikely that shares in a bank are going to jump by 500% in any reasonable timeframe, and NatWest's shares have been reasonably stable over the last five years (ignoring the lockdown period where everything went a bit weird). Given inflation etc, stable == losing money.

You're far better off taking the money and doing something useful with it, IMO - like paying a chunk off your mortgage. That'll be worth more in the long run than the hope of a boost in the share price.

Let go of the idea that their “real” value is £50k. It isn’t. Their really value is £8k at the moment but that could change. They are volatile and if you hold them you are gambling. No-one really knows what will happen to share prices (this is why traders get paid big money but they aren’t infallible) so no one can really answer this for you. It really comes down to your risk appetite

I am no expert and in your shoes I’d seek proper financial advice, but from what I’ve read you should keep them from the long term to ride out the market. If you already have a sufficient emergency fund and a pension and you genuinely don’t need the money I’d be tempted to keep them. But try to reframe it in your mind about them being “worth” £50k otherwise you’ll always feel like you’ve lost out. Shares always have the potential to fall as well as rise, so they were only “worth” £50k if you’d sold them at that one point in time. So try not to see it as £8k versus £50k but rather £8k versus potentially more, potentially less. Only you know what level of risk you’re comfortable with.

You could use the money to pay off part of the mortgage.
ATM they are yours, mortgage is (I presume) joint.
Do you have children from 1st marriage that you need to provide for?
If you sell them, check tax situation of this year which ends April 3rd.

Your shares aren't worth £50k. They're worth whatever they can be sold for today. How much did you actually pay for them?

You need to disavow yourself of the notion that you've "lost" £42k - you haven't. You never realised the gain. The world is full of people who have 20/20 hindsight saying that they should have sold when something was worth more. Coulda woulda shoulda.

If they're causing you concern then sell them, take the money and never look at the stock price again.

If you want to speculate a bit more then hang onto them and accept that the price can go down as well as up.

Yes, they were worth so much more before the crash. Fred Goodwin also hoodwinked staff in to buying more shares, when he knew the Company was going under - this is why he got the sack, I think (memory a bit hazy).

I can't pay a chunk off the mortgage, as I already over pay as much as I am allowed to without penalty.

Can't pay any more to mortgage. The mortgage is in my name only, as I bought the house before I met 2nd DH. My children (from 1st marriage) are grown up and left home, both self sufficient in good jobs.

Pretty much as above, they're not worth £50k so you're not losing £42k.
I'd sell up and use the £8k for something like paying a chunk of the mortgage off - a much better use considering I doubt they'll go anywhere near their 'old' value.

My dad had exactly the same situation with Lloyds Bank shares OP

They “should” be worth about £150k. I remember how devastated he was when they plummeted (well before the 2008 crash, must have been in the early 90’s) and they went down to about £2k

He’s held onto them all this time since, mainly because like you, he no longer needs the money, and says “one day” they may recover. I think he always said he’d sell when they hit £10 a share, and last time I looked they were 6.5p or something ridiculous - but he keeps the faith.

I'm not sure I could even work that out. Multiple staff schemes taken out over decades. I could maybe work it out by going over old paperwork, which could make me feel better!!

I would look at future proofing your home - so, do you need double glazing? New thermal curtains, Solar panels etc?

Very brave to ask people who aren't trained financial professionals/traders what to do with your shares.

That said, in my unprofessional, uncertified, feelings based, personal opinion, we're going into a recession. Do banks grow in a recession? I don't see any immmediate tangible growth moves from Natwest. Cut your losses, sell. Put the money into a smaller company with more growth potential.

OMG, that's a loss! I didn't realise this had happened at Lloyds as well. This is the thing re hanging on, isn't it - once you sell them, that's it, game over. But realistically what am I hanging on for? They were in their hey day £20 a share they are now £2.79! Gah!

Believe me, after this experience the money would only go into an ISA. I will never buy shares again!

I'm in the same position with HSBC shares, also bought over a long employment with them via share save. I've not worked for them for about 7yrs now and I've seen them go up and down. I'm holding on to mine for now as like you, I don't need the money, they are actually picking up a bit and they also pay good dividends. I have a mental 'take profit' level of about 7.50 which is about the average I bought them for, but below the 10.0 top of the market.

I've got some Natwest shares sitting at a loss in my portfolio. However, they pay a small dividend so for now just sitting on them and waiting to see what happens. It's annoying but not much to do but wait.

Do you know how much dividend you're getting?

Do you have a stocks and shares ISA? If not get one and turn that one trick pony into a nice slice of lots of brilliant Americans companies!

Eg but an s and p index funds.
The only individual shares I would ever hold are amazing companies like Apple and Unilever but even then I would prefer to hold them on a basket with lot's of others so if the company does fail, you don't loose out.

I am sorry this awful situation happened. Has there been a financial investigation into it?

Anyway...Def sell and buy some decent index funds

@BeachBlondey

Please don't let this experience put you off!

Jack Bogle, founder of vanguard said " why try and find the needle when you can buy the hay stack". ..

My DC have both cash ISA and stocks and shares ISA.
The cash ISA is 3% and the stock and shares is running at around 25%.

The mistake here sounds like snake oil company sale's man profiting off his own employees.

Look on this as a. Opportunity.

Don't obsess about something you never had. You "could" have sold them when they were artificially over-priced, but you didn't. The chances are their value will never recover to anywhere near the peak. It was a "bubble" not real, based on the over-inflated financial markets of the Brown/Blair era which led to the crash.

They may well increase in value, they may not. It's nothing but a gamble and even "experts" havn't any real clue - most of the financial markets is based on betting/gambling rather than genuine knowledge!

Natwest (RBS) isn't a particularly modern nor forward thinking bank, and will be "challenged" by the modern breeds of bank, so personally speaking, I don't think their shares are going to rise much and may well end up falling and/or collapsing completely.

The question about dividends is good, however, people need to be aware that any investment in stocks and shares or property, for that matter, is a form of gambling.

Put it in the FTSE 100 (top 100 companies in UK) over it’s 40 year history it’s had an average return of 8.9% annualy.

@Addicted2Kale

I beg to differ I studied all this for several years, and read numerous books and listened to podcast's i took our ft subscription and read morning Star and trust net.

My own independent findings match what I see from other investors all around me.
I suspect most of investors would never have touched this scheme in the first place.
Most of us invest most in steady index funds which are full of loads of different companies and then. Small % on higher risk fund's like fundsmith or Scottish mortgage or even crypto!

I am absolutely not in anyway an expert but my actual stocks and shares ISA is my proof in my pudding and my DC's.

Op should always as most intelligent posters do...and get the benefits of the hive mind and then have a think!

Who honestly thinks that any op just blindly follows what anyone on here says!

Kazzy I would agree and my own dealing with them I'd say they are absolutely crap and I wouldn't touch them with a barge pole!

They will struggle against Monzo etx