I would strongly advise everyone to max out their ESPP contributions (you can contribute a maximum of 15% of your salary, up to the IRS mandated $25,000 limit). Why? Because it's a amazing investment that, if you sell stock immediately on reception, is risk free. I'm going to assume you know how ESPPs work, google them if you don't.<p>Let's do the math: consider a typical ESPP (yours may vary) with a 3 month purchasing period, 15% discount, and no lookback policy. Assume you are contributing $5000 this purchasing period.<p>$5000 buys n units of stock at at a price of m dollars with a 15% discount: 5000 = .85mn<p>Immediately sell each unit of stock for m dollars for a total return of mn dollars: 5000 = .85mn => mn = 5000 / .85 = $5882.35<p>You made $882.35 in "profit". Not bad at all, but not much in the grand scheme of things either. But! That's a return rate of 882.35 / 5000 = 18% in just 3 months. If you could turn around and reinvest that money in the ESPP 3 more times (4 investment periods, each 3 months long, for a total investment period of a year), you would get a yearly return of (1 + 18%)^4 = 94%. 94%! Risk free!<p>If that seems to good to be true, the catch is in the first paragraph. An ESPP might provide 94% yearly returns, but the amount you can invest is relatively small. But it's free money, and I encourage everyone who can to take it.<p>Edit: some people have rightfully pointed out that "risk free" is an exaggeration due to the possibility of significant price swings in the time between the stock purchase on your behalf and you selling the stock. You may also be unable to sell immediately due to black-out periods. Also, this isn't financial advice and I'm not an expert.