period length: 6 months max contribution per period: 10625 purchase price: (0.85) * MIN(price at start of period, price at end of period) FWIW At Akamai i have made about 5-7k every year on this program. Not that much but a nice little benefit. The lookback is the key piece. How much should this be valued toward TC?
If you need to think about ESPP to measure TC, then you may need a higher TC. We compare TC/YOE to get a sense of what others are getting offered so we have a stronger negotiating hand. ESPP value is not relevant for this purpose.
Why ignore benefits? Which is a better offer 300k @ Amazon or 280k at Google? Google has free food, a much better 401k, etc. I bet if you do the math on it the Google offer is higher.
That's not what we commonly consider TC.
There’s two reasons two ask this question and the answer to both is: practically nothing. If you’re asking for dick measuring purposes, you’ve lost if you need to measure from the balls. If you’re asking for your own understanding of your income, prepare to be disappointed. Suppose you’re capped at 15% of your base (that’s usually how the contribution is calculated). Further, suppose your base is 300k. I’m being super generous to illustrate how irrelevant that is. Further ignore fixed limits (I believe there’s a cap around 25k per year of contributions but let’s ignore that). So you’re putting 15% of your 300k into ESPP, $45k per year or 22.5k per half. The potential upside of espp is unlimited so I will ignore stock market growth. In a 6 month period it’ll only grow so much. Let’s say 10% year, roughly 5% per half. So you are basically getting the stock at 20% discount of current market value. That works out to 9k per year before taxes. On 300k of income this is 3% of your base. It’s nice but this very generous calculation doesn’t change anything significantly. The real net benefit for most people will probably be closer to 1-2% of base. It’s still 100% worth doing because limited downside and unlimited upside. But it’s not a huge factor TC wise. I find it works nicely as a psychological way of saving that ESPP money and getting a nice “bonus” every six months. TC: 380 (without ESPP)
If my penis is measuring at 254k can I round to 260k with the ESPP?
Of course. Just pull on it.
It cannot be. TC is strictly the base salary, stock and bonus.
TC = Total Compensation Are you saying that this ESPP plan is not compensation? I would argue it is compensation because it clearly has value.
So does free food, insurance plan, 401k matching, company swag, gym memberships, etc. the convention is to only count base, stock and bonus