{ "media_type": "text", "post_content": "I love this group. For those that receive company equity as part of their comp, what’s your strategy? Do you immediately sell it all and put the cash into index funds?", "post_id": "604e5e33c564e00024777b47", "reply_count": 14, "vote_count": 3, "bowl_id": "5b3f7377ab53db00136f7b4c", "bowl_name": "FIRE Financial Independence Retire Early" }

I love this group. For those that receive company equity as part of their comp, what’s your strategy? Do you immediately sell it all and put the cash into index funds?

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Also worth looking into tax implications - I think waiting 1 full year after vesting date will qualify it as long term capital gains

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OP, the timing of when taxes are due may differ slightly but for both types you need to separate what was income (value on exercise date - what you paid out of pocket for stock options, or value on vesting date) and pay income tax on that because it is a form of compensation. You should talk to an accountant though to confirm

I sell all immediately to diversify into index funds. All the future equity (not to mention my employment) is already tied to my company’s success, no need to keep additional stock.

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Thanks! This is what I figured. Because of the annual equity refresh I’ll always benefit from future upside. The long term capital gains point is a good one though. Thanks for confirming my logic!

If I gave you a check for the exact value of your RSUs, what would you do with it? Whatever your answer, that's exactly what you should do with your RSUs. It's just a check in a different format. Unless you're already buying buckets of your employer's stock, you probably shouldn't hold on to them. Anecdote: My last company's stock tanked hard not long after IPO. I knew a couple who depended on their RSU for their down payment, and they had to delay home ownership a couple years because they didn't sell.

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Joining a company soon where I get equity. Same Q here. My thoughts are sell 1/2 of what’s left after taxes to diversify so my savings + my income is not all indexed to one company but would like to hear any other opinions.

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Learn about 83(b) elections to see if it applies to your situation.

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Well, typically you can't sell immediately due to long vesting periods. Once you're vested, it depends on the company. If the stock is attractive, keep it. If not, cash out and move to other funds and investments. Tax implications apply obviously

1 year cliff and then monthly vesting thereafter. But sounds like I need to hold 12 months of vested options to get the tax benefit. Seems like even if I’m bull-ish, it’s probably not smart to keep too much invested in a single investment.

I hold, but it’s the first thing that goes when I need money. Accenture stock has done really wel the last couple years

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