|If you find that you're over-invested in your company, consider the following:
1. If your goal for this money is more than five years away, weigh your company's longer-term prospects. Analyze your company as an investment. To learn how to do that, take a few courses in the Stocks curriculum. If your company's stock is public, you can find out more about your company using Morningstar.com's Stock Reports.
2. Even if the prospects look bright, weigh all the risks we've covered about investing in your employer's stock. Most people will want to limit that risk, but some may choose to accept a higher degree of risk for the potential payoff.
3. If you decide that you need to reduce your exposure to your company's stock, you'll need to map out a plan. If you bought or received the shares at a very low price, you may owe significant capital-gains taxes on the growth of those shares if you hold them in a taxable account. (Selling shares held in a tax-deferred account such as a retirement plan or IRA won't trigger any taxes.)
You can either take the tax hit all at once, because you can't handle the risk. Or you can take the risk and continue to hold the shares, because you know the taxes will kill you. The best choice for many, however, may be selling your shares over a series of years to spread out the tax bill.