Relying on RSUs

New / Eng going2g
May 9 21 Comments

Looking to get some insight into whether or not folks rely on RSUs for their monthly expenses.

Context:
- RSUs are only guaranteed for the first 4 years of employment, resulting in a "cliff"
- Stock price is volatile
- Stock refresherers aren't guaranteed
- RSUs can be a significant portion of your TC, and it may not be possible to live on base salary alone

So curious to know which scenario is most common, and how people treat their RSUs

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TOP 21 Comments
  • Facebook public2
    This is basically asking if you work for Amazon or not. Wouldn't that be an easier poll?
    May 9 6
    • Facebook public2
      Not sure what you are talking about hpe. I am referring to the fact that amzn has a salary cap.
      May 9
    • New / Eng going2g
      OP
      @public2 I'm just surprised that people save all of their RSUs despite it being more than a third of their TC in a lot of cases. That's pretty awesome.
      May 9
    • Facebook public2
      Guess so, many folks will sell the to diversify investments.
      May 9
    • New FeEL05
      Amazon, wrong partner then. FI is so much harder if s/o isn’t on board
      May 10
    • Facebook public2
      Always love when amazonian chime in to say they hate cash, don't understand time value of money or liquidity, and prefer the stock heavy comp ;)
      May 10
  • Pure Storage / Eng r@nd03
    RSUs are not granted only for the first four years. All places I have been at gave refreshers every year to anyone who meets expectations. In fact, at stable state, yearly RSU vesting is usually more than what you would get in the first or second year from your initial grant and a refresher. This doesn’t count stock appreciation or higher refreshers because you may be in the growth stage in your career.
    May 9 5
    • New / Eng going2g
      OP
      I don't have much experience with this, but since I've never seen or heard of a written agreement for refreshers (eg, similar to target bonuses), I'm hesitant to assume they'll come every year. Eg I'm guessing refresher amounts would reduce significantly if the company/economy was going through a rough period. Would love to learn more though.
      May 9
    • Tableau / Eng
      The Plague

      Tableau Eng

      PRE
      Microsoft
      The Plaguemore
      You clearly haven't been at Microsoft 😂
      May 9
    • New / Eng going2g
      OP
      Can confirm I haven't
      May 9
    • Tableau / Eng
      The Plague

      Tableau Eng

      PRE
      Microsoft
      The Plaguemore
      No, I was talking about the guy from Pure Storage.
      May 9
    • New / Eng going2g
      OP
      Lmao my bad
      May 9
  • LinkedIn rsu cliff
    Most of us get paid more salary+bonus than we spend, so RSUs are saved/invested for the future.

    However if I could trade $X of my salary for $1.2X more RSUs (with no initial 1-year vest), I would. As for the 4 year cliff, I figure either the company refreshes you or you go somewhere else for more. Win-win.
    May 9 3
    • New / Eng going2g
      OP
      This is my initial thinking. Joining G soon and doing some budgeting. Ideally, I would want to survive off of my base salary. But if I save all of my RSUs + max out my 401k, I'll be saving about 50% of my net TC! Is that really what most people do?! No wonder everyone is FIRE-ing in their 30s lol
      May 9
    • State Farm HCgs3333
      One of the most famous (so probably misquoted) Warren Buffett sayings is that the most powerful force in the universe is not love, it’s compound interest.

      I wish I could go back 20 years to my younger self and tell me to find a gig that allows me to save/invest half of what I make. Kids and a family are expensive. It’s very easy to adjust to living in a more lavish lifestyle and it gets exponentially harder in life to adjust to spending less money consistently, even when your partner is thrifty.

      The salaries in tech right now are insane levels of luxury. If you can put away 70% of your income to savings and investing and still live comfortably, by all means do so young man/woman. If you feel weird about it or impostor syndrome kicks in, donate 10 of those 70% to good causes. Trust me, nothing feels better than knowing your future is safe, your job is interesting and helps you grow, and you’re making the world a better place to those not as lucky as you.

      Money is not the root of all evil. Lack of money is. Money can allow you to do amazing things and you need a lot of luck to get it. I recognize a lot of signals now similar to the years before the tech bubble burst in 2001, it made things really harsh for tech afterwards. There’s no Y2K event coming now though so this might last a couple more years. Jump in there if you can.
      May 10
    • New / Eng going2g
      OP
      Thank you both for your input! I am young and married with no kids, and it's definitely possible for us to save all of my RSUs. But when I realised that would mean saving 50% of my net TC, it made me pause for a moment. I'm the sole earner, and also responsible for the finances in the relationship (my spouse is in school and kind of clueless/apathetic towards money matters). So I was concerned I was being too thrifty by deciding to save 50%, when instead we could spend a little extra and enjoy life more.

      Thanks for the encouragement though! Glad to hear that I'm not being extreme with my budgeting.

      Btw, thanks for also pointing out donating! I currently donate about 8% of my TC and that should go up with this new gig 😀
      May 10
  • Indeed / Eng lty
    Whats rsu?
    May 9 1
    • New / Eng going2g
      OP
      Restricted Stock Units.

      Employers supplement your base salary with company stock to further increase your total compensation (TC)
      May 9
  • Indeed / Eng pipe
    I dont rely on one, because I dont get one
    May 10 0
  • Facebook fbzk
    Yeah, been really rethinking investment since rsu became bigger part of income over salary and bonus
    May 9 0