Wednesday, December 17, 2014

ESOP at a grocery store

Apparently the employees of the Winco grocery chain are doing very well in the retirement department, thanks to an ESOP (employee share ownership plan).  

This Forbes article gushes about awesome this all is, but makes no mention of the elephant in the room.   I'll give you a hint:  Nobody at Enron ever thought that their retirement plans would become worthless overnight!!  

So while the ESOP makes a lot of sense in some ways, in other ways, the employees are horribly un-diversified.  They are one very bad salmonella outbreak away from loosing their jobs and their savings.