
Ask HN: I have received RSU's. Now what? - th-miracle-257
Please help me with any or all of the following:<p>- a simple definition of RSU&#x27;s<p>- how to effectively utilize these? and yet,<p>- how to not let them be your golden handcuffs?
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marssaxman
An RSU is like a pre-order for a share of stock. Your employer gives you an
RSU with a specified vesting date as an incentive to continue working for the
company until that date. On the vesting date, the RSU magically turns into a
share of company stock, which is then yours to keep or sell as you please. If
you leave, any remaining un-vested RSUs simply evaporate.

Holding shares in the same company that pays your salary for is not great from
a risk-management point of view, so most people sell their shares as soon as
they vest. You can reinvest the proceeds in a mutual fund or something.

Golden handcuffs only work if you let them. I make a habit of completely
ignoring RSUs and acting as though they have no value. They play no part in my
decisions about where to work or how I feel about the compensation package. If
the salary is good I take the job, if not I go somewhere else. If the RSUs
turn out to be worth something, then yay, it's a bonus! But most of the time
they are not as good a deal as company recruiters would like you to think they
are - if they actually _were_ worth the cash equivalent a recruiter will quote
you, the company would save themselves the trouble of managing the RSU program
and just give you the cash instead. The company saves money by offering you
RSUs because you will never be able to cash in on all of them - you will
always walk away from the company with un-vested RSUs at some point. That's
not a terrible thing, just don't let yourself count RSUs as real income until
_after_ they actually vest.

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rahimnathwani
Assuming these are RSUs are in a listed company whose shares are liquid, the
things that are important are:

\- the list of vesting events (including date and # shares)

\- the current market price of the stock

You can use the above to calculate your future income at this job (after
adding your cash salary and expected bonus). This will provide a benchmark
against which to evaluate future job offers.

If you want to diversify your portfolio (rather than having a large part of
your wealth linked to the stock price of your employer), then you could sell
any shares immediately as they vest, and use the money to buy an index
tracking ETF.

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drharby
>how to not let them be golden handcuffs.

Stay competitive and willing to leave for a different company or find value in
other things than gold.

