If you buy listed shares on the nasdaq, and they fall you lose money. duh? No reason to think it works any differently in a private company - in fact private s

If you buy listed shares on the nasdaq, and they fall you lose money. duh? No reason to think it works any differently in a private company - in fact private shares often carry a much higher risk of becoming worthless. There is no certain guarantee that shares in your current or past employer "is gonna pay for your house". If you have such an attitude you really should be thinking twice. This whole "share options for everyone" mentality is a problem. Share options are for risk/reward seekers - which means you accept the RISK just as eagerly as the reward. Options are not supposed to be some sort of freebie lottery ticket for everyone. Its meant as incentive for people with an entrepreneurial spirit who may be taking risks in terms of job security, or those who bring highly specialized knowledge to a startup at below market salary, or as an incentive for employees to work far harder than they would normally be expected to be working. Tax considerations - definitely get real expert advice And see what others have said below.