How One Microsoft Employee Maxed Out His ESPP Without Fronting Any of His Own Money
by Andy Kalmon
Jul 18, 2024
Meet Adam
Adam is a software engineer at Microsoft, earning $150,000 annually. Like many of his colleagues, Adam is aware of the fantastic opportunity presented by Microsoft's Employee Stock Purchase Plan (ESPP). The plan allows employees to purchase company stock at a 10% discount and contribute up to 15% of their salary. On paper, it sounds like a dream come true for building wealth.
But there's a catch.
The ESPP Dilemma
Adam has financial priorities that make it difficult to participate in his ESPP.
His focus is on building an emergency fund and maximizing his 401(k) contributions. Participating in the ESPP would mean having $938 deducted from each paycheck—an amount that significantly impacts his take-home pay and his current financial strategy.
If Adam were to max out his ESPP contributions, he would stand to gain $625 from the stock discount every three months, resulting in a total stock purchase of $5,625. However, the immediate reduction in his paycheck is a tough pill to swallow, and it's a hurdle that keeps many employees from fully leveraging their ESPP benefits.
Enter Benny: A Game Changer for ESPP Participation
Adam's situation changed when he discovered Benny, a platform designed to fund and manage ESPPs seamlessly.
Benny offers a unique solution: it covers the contributions needed to maximize ESPP benefits without reducing take-home pay. This way, employees can enjoy the financial gains from their ESPP without the upfront financial burden.
How Benny Works
Here’s how Adam benefited from using Benny:
Funding: Instead of having $938 deducted from his paycheck, Benny found the funding Adam needed and it covered the ESPP contributions for Adam.
Stock Purchase: Adam still purchased $5,625 worth of Microsoft stock every three months, taking full advantage of the 10% discount.
Gains: Adam gained $625 from the discount, just as he would have if he had fronted the money himself.
Fees: Benny charges a fee for its service, which in Adam’s case was only $138 (fees vary based on individual strategies).
After deducting Benny’s fee, Adam's net gain from the discount was still $487. This was achieved without any impact on his immediate financial priorities or take-home pay.
The Benefits of Using Benny
By using Benny, Adam unlocked free money and several key benefits:
No Impact on Take-Home Pay: Adam maintained his financial commitments to his 401(k) and emergency savings without compromising his lifestyle.
Maximized Gains: Even after fees, Adam realized substantial gains from his ESPP.
Convenience and Peace of Mind: Benny’s management of his Microsoft ESPP, from enrollment to gains management, removed the complexities and worries associated with the ESPP and using funding to maximize it plan.
Conclusion
Adam's story illustrates the potential of Benny for Microsoft employees looking to maximize their ESPP benefits without sacrificing their current financial stability.
By offering a funding solution, Benny empowers employees to use someone else’s money to fund their ESPP efficiently and effortlessly.
If you, like Adam, have been hesitant to fully participate in your ESPP due to the impact on your take-home pay, Benny could be the perfect solution. Don’t let immediate financial constraints prevent you from achieving long-term financial gains. Explore Benny today and start maximizing your ESPP benefits effortlessly.
Make More Money from your ESPP with Benny's New Program
Benny provides the funding and management you need to maximize your ESPP without affecting your take-home pay. Join the hundreds of employees who are gaining, on average, an extra $3,000 annually through their ESPP with Benny.