Employee Stock Ownership Plan (ESOP)

An Employee Stock Ownership Plan (ESOP) is a program that allows employees to own shares in their company. This benefit is often part of a retirement plan, enabling employees to acquire stock over time, usually at no upfront cost. As employees work and contribute to the company, they build equity, which can grow in value, providing financial rewards upon retirement or departure. ESOPs can enhance employee motivation and engagement, align their interests with company performance, and offer tax advantages to both employees and employers. Ultimately, they serve as a form of employee compensation and retirement savings.