Should I become a shareholder when ShareSave ends?

Exploring the benefits of employee ownership.

As you approach the end of your ShareSave contract, you'll need to decide whether to use your savings to buy NatWest shares.

But before we get started, we wanted to let you know that we wrote this article to help you make an informed decision, but it’s not financial advice. If you’re not sure what to do when your ShareSave contract matures, we suggest you seek independent financial advice.

Why employee ownership matters

At NatWest, we believe in the power of employee ownership. We want to extend the opportunity to as many of our colleagues as possible because, when the bank does well, it should benefit all of us. But what does being a shareholder really mean for you?

Having a say in how we run things

Being a shareholder means you have a voice in how NatWest operates.

You’ll have a say in the decisions that shape our bank's future. You get to vote on resolutions at our Annual General Meetings (AGMs), where we discuss important matters like electing directors, selecting auditors, and approving financial statements.

Your opinion counts and playing an active part can be an empowering experience.

Sharing in the bank's success

Another perk of being a shareholder is the potential to receive dividends. When NatWest shares profits with its owners, you get your slice of the pie based on the number of shares you own. These dividends can be a welcome boost to your finances and a measure of the bank's success.

And if the bank performs well, the share price could rise too, though there are no guarantees.

Your ShareSave decision

When you’re deciding what to do at the end of your ShareSave contract, one consideration is whether the current share price is higher than the option price. If it is, you’ll be better off buying shares than taking your savings back as cash.

If you do choose to buy shares, should you sell them straight away at a profit, or hang onto them and become a shareholder in the bank?

This choice can be a bit daunting, especially if you're new to investing. We’ve already outlined the benefits of becoming a shareholder, but there are a few other factors to think about before you make your choice.

Understanding risk

When you own shares, their value can go up or down. NatWest's share price may be affected by the bank's performance and other market conditions, so there is the potential for your shares to lose value if the bank faces challenges or if market conditions aren't favourable. 

Read more - see our article 'Understanding investment risk' in the Knowledge Centre. 

The bigger investment picture

Think about how your decision fits into your overall financial picture. Are your investments diversified? Having a substantial part of your money in only NatWest shares might not be the best strategy. Make sure your investments are positioned to achieve your long-term financial goals and you’re comfortable with the overall level of risk you’re taking.

Be prepared for the long haul

Consider your shorter-term needs. Do you have enough cash set aside for unexpected expenses? Relying solely on selling your shares to cover these costs isn't ideal, as shares are generally meant for the long-term. 

In conclusion, becoming a shareholder when your ShareSave contract matures is a significant financial choice.

It's all about understanding the rewards and risks associated with ownership. By carefully considering your investment goals, risk tolerance, and broader financial situation, you can make an informed decision that aligns with your financial well-being and future aspirations.