Confused on TC scaling
So some people have posted their “TC is now X due to stock appreciation”. I’m wondering how this is possible because aren’t you granted a dollar amount in RSUs? Meaning, when you vest the amount in time, that day you are paid the stock price / vested price. If this is true, you’re always getting the same stock value so there’s no TC appreciation. Could anyone shed light on this one?
Usually on grant the dollar value is calculated in current shares and you actually get given the shares to vest. It’s not a new grant each year (though you may get those too). My initial grant from MSFT was calculated at $94/share and given to me in shares. When they vest, I get them at $280 now.
Depends on company. Most companies will give RSU (units) and not a capped dollar amount. Msft is capped by dollar amount, Amazon is unit based
Most tech companies give you a $ value for RSUs but convert those to a # (typically based on the monthly avg. stock price). This is the most common and has the most lucrative upside. However some newer companies (eg. Stripe) have fixed the values as $ amounts which IMO is very unappealing since your upside is capped.
+1
So say I got $200k worth of RSUs. Should I not expect 50K over the next 4 years? Meaning, if the price increases per share, I get less shares, but still 50K obviously. Is this right?
I guess my question goes to Apple - I know folks from MSFT and google have answered and I appreciate it, just not sure if it maps to my predicament I guess.
Lets assume you got an offer from FB at 150k base, 400k RSU, 25k sign on bonus on Jan 01 2021. Lets assume FB is at $100. You got assigned 400k/100 = 4000 units . Stock vest over 4 years. Your offer is at 150(base)+25(sign)+100(stock) = 275k For 2021: you get 1000 shares. Lets assume FB is at $120 now. Your TC is 150k(base) +25k(sign) + 120k(stock) = 295k For 2022: lets assume fb is at $200. You vest 1000 shares. Your tc is 150 (base) + 200(stock) = 350k. So your tc at the time of offer was 275k, and is now 350k (WITH STOCK APPRECIATION)
I think I’m starting to see it, so when is the dated calculation of the RSUs done? I guess I was under the impression that they’re done periodically at a price the share is currently at, and not determined all upfront.
Its done when you join
To add specifics, when I joined FB, I was given an RSU grant that equalled roughly 6000 shares of stock at the time. Those shares are effectively "set aside" when the grant is approved. Every three months, for the next four years, I get 1/16 (375) of those shares, which are worth 375 X whatever the FB stock price is on that day. Since my compensation started as 60/40 stock to cash, increases in stock have a huge effect on TC.
The only possible explanation must be that you are granted a number of shares.