Is Now The Time To Sell My Restricted Stock?

Ryan is with us in Texas

hey Ryan welcome to the Dave Ramsey show

hey Dave how are you doing thanks for

taking my call

sure man what's up okay well I have a

couple of restricted stock units they're

vesting in the middle of May and I just

curious what to do with them especially

I know you said if you're investing to

keep everything there and not withdraw

but since I'm getting the the shares I

would usually sell them but because it's

really bad I'm saying don't take

anything out I'm talking about your

mutual funds I'm talking about stock

investments that you wish you didn't own

or that I mean they're nice they're free

it's it's a good thing but if it's a

restricted stock unit it's probably an

initial public offering of some kind a

very young company and somewhat volatile

am I wrong this is more of a an

incentive a long-term incentive

oh okay we do okay all right so the they

just the only restriction was just to

get you to vesting not because they were

worried about the stock price of stock

hitting the market okay all right so

what's this worth when you cash it out

um the initial distribution I think

right now is twelve thousand okay and

where are you on your baby steps we're

on baby steps six okay

so it's extra money then yeah and we

have we have a baby due in May as well

so no that changes a lot Boca is the

stock down is it volatile describe its

patterns since the year that I was it's

been a year since I received the the

best shares and it's gone down $20 so it

was 25 ish and now it's about $6 whoa


well the market has not gone down that

much so the company's not doing well

yeah it's a toy and gas in Texas


okay well here's the thing you're not

desperate for the money if you got zero

it doesn't change your life correct

okay it's worth $12,000 now but it was

worth five times that or say $60,000 a

year ago yeah

okay now so what we would have to do is

we'd have to think through is there a

reason to sit on it for 90 or 120 or six

months it's not something I want to sit

on the rest of my life but this could be

one of the worst possible times in your

industry in the last couple of decades


some of that was brought on by the fact

that no one drove cars for the last

thirty days to mount anything so demand

for gasoline oil consumption has gone

dramatically it's off ninety percent or

something and for that reason that we've

got tankers sitting off the coast all

around the u.s. storing oil sitting

there and the oil companies are paying

them to store the oil just sitting in a

tanker they don't even want to offload

it they don't have a place to put it

because they're storage units are

completely full that's why that's house

Boyle went to negative per barrel you

following me you probably know all this

right yeah I've been watching it ok so I

think it's not a far stretch to say once

the economy starts moving again oil

starts being consumed your company is

going to be worth more if it doesn't

bankrupt in the meantime yeah and in

other words this time six months from

today I it wouldn't be a far stretch for

this to be worth double what it's worth

today yeah because it's just in a very

unusual economic situation right now and

you're in a very sensitive industry in

this particular time

so all that to say a you don't need the

money if it goes to zero we didn't lose

anything B I wouldn't buy it if I was

just walking up to buy stocks right now

but you own it I'm probably gonna ride

this until the fall and then whatever it

does buy whatever give yourself a date

whatever it does by October 1 I'm gonna

sell it then regardless I'm not gonna

keep kick I'm not gonna keep kicking the

can down the road but I'm gonna give

this thing a little bit of time to heal

you could double your money between now

and October would you agree with that

yeah and that's kind of what I was

planning on doing but I I was 50/50 and

I wanted to somebody else to weigh in on

it there is I just I've haven't had the

situation before and you know with the

economy the way it is I didn't want to

make the wrong choice either so what I

don't want to do is I don't want to get

in the habit of analyzing this and

kicking the can down the road and going

well I'm gonna try six more months and

I'm not trying on the air you know and

then you're all sudden you're investing

in all stocks long term which is not

what I would tell you to do even though

you work there but I I do think you're

in an industry that is artificially low

right now due to an economic anomaly

with that we've never seen before it's

not a recession it's not a depression

it's a suppression the government said

everybody stay home we could spending

money boom everybody stayed home quit

spending money and it destroyed sections

of the economy temporarily and that's

that oil is one of them and so that if

it was me I would hold it until about

October 1 and regardless I'd dump it and

congratulations on the new baby on the

way good question now I don't time

markets I don't jump in and jump out

depending on what I think the economy is

going to do but there's some rare

situations where you're in an unusual

situation like this where you just use

some common sense and some basic

economic understanding to make a call I

don't buy stocks based on I think

they're low and you know they're

artificially low I continually invest in

mutual funds

I put the exact same amount in this

month that I put in last month that I

put in the month before that I put in

the month before I'm very very steady

and right

get her on my investing I don't jump in

or out based on what's in the headlines

of the news that will cause you to lose

money don't do that and you don't cash

your 401 k's out right now because

you're scared

some of you cash them out at 19,000 it's

already back up to 24,000 down well

wasn't that silly no you ride these

things out and in his case we're gonna

ride is even an individual stock out a

little while longer