Tips On Navigating RSUs

This video highlights the complexity of RSUs (Restricted Stock Units) in tech compensation, emphasizing how RSUs introduce elements of personal investing into salary evaluation. Understanding how stock fluctuations affect total pay and managing risk becomes crucial.

• Evaluating RSUs is similar to investing, since compensation becomes tied to the company's stock performance. Joining when stock prices are low can lead to significantly higher gains if the stock appreciates.
• Choosing a company means essentially “buying” into its future, since RSUs form a large part of total compensation. A rising stock price increases income; a falling one diminishes it.
• There is no universal rule for managing RSUs, as financial goals and risk tolerance vary by individual. Compensation strategies should reflect personal financial context.
• Some employees choose to sell RSUs immediately upon vesting, aiming to diversify rather than concentrate risk. This reduces financial dependency on a single company’s performance.
• Investing RSU proceeds into diversified assets like S&P 500 index funds is a common approach for those seeking more stability and reduced exposure to employer stock.