What should I do about this money?

**Ilovesewing** · 06-04-2008, 08:12 PM

I need your opinions here because I'm certainly not the most savvy person when it comes to money outside of day-to-day stuff.

Five years ago I was laid off from my job, and I had stock options that I had to sell by a certain date due to my layoff. The day came, I bought and sold the stock options and they sent me a check.

Probably a few weeks/months later I got a phone call from Fidelity telling me I still had $68.00 in my account, and would I like to keep it there or should they send me a check. Since it was only $68.00 and I have no other holdings with Fidelity I told them to just send me a check. Somehow, I haven't figured out how, this money got 'left behind' when they sent me the stock option check. Not a big deal. I told them to send me a check and forgot about it. Months later I get a statement in the mail from Fidelity showing I had $68.00 in my account. I promptly put it aside and forgot about it. They never sent me a check.

Fast forward to this year. A couple of months ago I got my annual statement. My $68.00 'left over' money has grown to $550.00!! I guess it's been growing all this time, and mostly over the last few months, but because it was such a small amount I never took the time to look at it. This year I looked. So naturally I'm excited about the growth, but don't have a clue now what to do with the money?

The company stock has taken off which is why my balance has grown. However, (and this is where I have no clue....) just how high can it go? Really?? It has grown from $68 to $550 in five years. Can I really expect it to keep growing at that rate? I'm not contributing anything to it so the amount is what it is. I don't know what to do with it now. I do understand about compounding interest, but if the amount isn't being increased how much will it grow?

I don't 'need' the money. I can leave it there and it won't be a problem. But should I? Or should I take it, pay the taxes on it, and pay down my credit card? Put it in savings for some liquid cash if I need it?

Does anyone have any ideas? I'm seriously at a loss as to what to do, if anything!

**TheRootedNomad** · 06-04-2008, 10:12 PM

Einstein said "The most powerful force in the universe is compound intrest."

I'd probably leave it for another little bit if I didn't need it. I guess it kind of depends on what intrest rates your paying out on debts though. That would be the decieding factor.

**PrairieRose** · 06-05-2008, 08:35 AM

I thought you only had to pay capital gains when you sold it...??? Maybe I need to read investing for dummies. If it were me, I'd leave it.

**FrugalMomof3** · 06-05-2008, 09:01 AM

I too would leave it, seems like a nice chunk of money that will hopefully continue to grow.

**starsapphire** · 06-05-2008, 11:04 AM

These are stocks so the value might go up but it might go down too. You'll have to pay capital gains taxes on it at some point (don't know if its yearly or only when you sell, depends on how its invested) which if I remember correctly is 15% right now. If I were you I'd find a good financial forum and ask over there. Saving Advice is a pretty good one.

**Greebo** · 06-05-2008, 12:22 PM

Originally Posted by Ilovesewing

I don't 'need' the money. I can leave it there and it won't be a problem. But should I? Or should I take it, pay the taxes on it, and pay down my credit card? Put it in savings for some liquid cash if I need it?

How much do you owe and at what interest rate?

**Ilovesewing** · 06-05-2008, 09:42 PM

Thanks for your advice. I don't 'think' I pay any capital gains tax on it - I don't recall getting anything to file with my taxes. I did have to pay taxes when I originally sold the stock which they took out before they paid me. So maybe when I sell it I'll have to pay?

My concern is that it will go down and then I would lose the money. I guess that's the risk with the stock market.

Sadly, we owe about $9000 on our credit card at 9.99%. I just got an offer in for zero percent, no transfer fees, until 6/09 which I'm 'thinking' about transferring over. But then I just have another credit card and frankly, I just hate that. Even if I close the one I have now it just makes me nervous to open another account. And $550 (minus the taxes they would take out before sending it to me) wouldn't make much of a dent in that balance, but it would be a start I guess.

So I still don't know what to do! I have no problem leaving it there and just letting it be, but want to know that was a wise choice. I'll go find that Saving Advice forum?? and see what they say as well.

Thanks for your opinions everyone!

**Greebo** · 06-05-2008, 10:13 PM

9,000 at 10% is 900 more in interest a year.

8,500 at 10% is 850 more in interest a year, 500 more dollars available if you need it, and a lower minimum payment if you need to just pay the minimums. And, if you only pay the minimums, 50 less at 10% will work out to at least a few more hundred in interest not paid over the long haul.

The faster you can pay down the credit card debt, the better. Every time. If you can transfer to a 0% rate to forestall interest accumulation, only do that *IF* you cut up both cards and never use either again. Otherwise you'll just be digging a deeper hole to be your financial grave.

Yes, I'm trying very hard to scare you.

**Ilovesewing** · 06-05-2008, 10:51 PM

So you think I should take the money and pay it on the credit card? That does sound logical to me. My plan is to start paying it down quickly after October of this year. Until then I'm saving every penny for dd's wedding. I told her how much we would give her and we're about 70% there. So as of November I'll be snowballing $500 a month extra onto the credit card. That's the plan anyway. Does that change your thoughts on taking the money out?

**Nishu** · 06-05-2008, 11:12 PM

I would leave some in. I mean, if 68 grew to 550 and you said most of it was just in the last few months... why not just leave a wee little in to see what it does? Maybe $100? Or $68? You wouldn't be taking a huge risk, but after you take that money out you won't be able to see those gains again. It's a gamble, but it's not as though you were planning on having that money anyway.

Jmo.

**Greebo** · 06-06-2008, 05:18 AM

Originally Posted by Ilovesewing

So you think I should take the money and pay it on the credit card? That does sound logical to me. My plan is to start paying it down quickly after October of this year. Until then I'm saving every penny for dd's wedding. I told her how much we would give her and we're about 70% there. So as of November I'll be snowballing $500 a month extra onto the credit card. That's the plan anyway. Does that change your thoughts on taking the money out?

With a wedding coming up? Yes, with such a known, large expense coming, there's not much point putting every penny towards debt if you know you would have to turn around and use the credit again.

It doesn't change my thinking about getting *another* card, however. I've gone that route, and IMO its way to easy for the new card to become just another card in the pile.

**Bournecrazy** · 06-06-2008, 05:53 AM

cant you put it towards the wedding fund? at least its $500 less you need to save for and after the fund is full, start snowballing the CC but its up to you

**Greebo** · 06-06-2008, 09:06 AM

Originally Posted by Nishu

I would leave some in. I mean, if 68 grew to 550 and you said most of it was just in the last few months... why not just leave a wee little in to see what it does? Maybe $100? Or $68? You wouldn't be taking a huge risk, but after you take that money out you won't be able to see those gains again. It's a gamble, but it's not as though you were planning on having that money anyway.

Jmo.

As a counterpoint - what if the $50 goes down?

If the stock holder doesn't have a solid idea of how the company is doing (and based on the surprise at the growth, I think that's a valid question), then leaving $50 in amounts to gambling.

**Bournecrazy** · 06-06-2008, 09:10 AM

in MHO i would say take it out, if you leave it in there saying that you dont actually needed it then what happens in the future if you really need the cash and you go to claim it and its dropped well below $500 i would claim it now and just leave it in the EF or put towards wedding fund

**Russ** · 06-06-2008, 09:11 AM

Originally Posted by Greebo

As a counterpoint - what if the $50 goes down?

If the stock holder doesn't have a solid idea of how the company is doing (and based on the surprise at the growth, I think that's a valid question), then leaving $50 in amounts to gambling.

I agree and as a matter of fact my car pool buddy stated this morning "I don't gamble because you can lose your money and whay should I waste my hard earned money?" And my response was simply.. "you invest in the stock market via stock savings and thats not guaranteed." Granted, the odds are better, but it is still gambling.