You’ve got RSU’s. Now what?
If you’re working in tech, chances are RSUs (Restricted Stock Units) are a big part of your compensation. Between debugging code, late-night product launches, and making it to your kid’s soccer game, you’re also trying to figure out how to turn those shares into something meaningful—like buying a bigger home, covering tuition, or eventually taking a breather from the grind. It can feel overwhelming, but with the right strategy, your RSUs can be a powerful tool for building financial security.
Erik Schei, a senior financial advisor at Gates Pass Advisors, specializes in helping professionals like you navigate the complexity of equity compensation. Here’s how to make the most of your RSUs while keeping your long-term goals in sight.
What Are RSUs?
RSUs are company shares granted to you over time—usually tied to a vesting schedule. Think of it as a bonus paid in stock, with strings attached. Once they vest, they’re yours. But the moment they do, you’re hit with taxes as if you were paid in cash.
For successful tech professionals, RSUs often represent a sizable portion of income. The upside is big, but the risks and complexities can be too—especially if you don’t have a clear strategy.
1. Know Your Vesting Timeline
Your RSUs don’t vest all at once. They usually follow a schedule:
- Graded Vesting: Shares vest gradually, like 25% per year over four years.
- Cliff Vesting: All shares vest at once after a period, like three years.
Knowing your vesting schedule helps you plan cash flow, tax obligations, and major life events like a home purchase or a parental leave.
2. Plan for Taxes (Before the IRS Plans for You)
When your RSUs vest, the value becomes taxable income. If you don’t prepare, you might end up with a nasty surprise at tax time.
Key tip: Work with a financial advisor or tax pro to project your tax liability and plan ahead. You might:
- Sell some vested shares right away to cover taxes
- Max out tax-advantaged accounts (401(k), HSA, 529)
- Use a portion of cash flow to build a “tax reserve”
The goal? Avoid scrambling or dipping into savings when tax day hits.
3. Don’t Bet It All on Your Company
It’s tempting to hold onto your company stock—especially if things are going well. But too much of your net worth tied to one company (where you also earn your paycheck) is risky.
Better strategy:
- Sell a portion of your RSUs when they vest
- Reinvest in a diversified portfolio: index funds, real estate, college savings
- Align sales with life goals: new home, sabbatical fund, or family travel
This isn’t disloyalty—it’s protecting your family’s future.
4. Use RSUs to Power Long-Term Wealth
RSUs can be more than a windfall—they can be a launchpad for your family’s financial goals. Think of them as fuel:
- Retirement planning: Use proceeds to max out IRAs or backdoor Roths
- Emergency fund: Build or refill your buffer
- Debt paydown: Eliminate high-interest debt or refinance strategically
You don’t need to optimize every dollar, just make sure your RSUs are pushing you toward the life you want.
5. Time Your Moves Thoughtfully
Some people sell RSUs immediately. Others hold for long-term capital gains. What’s right depends on your cash needs, risk tolerance, and how you feel about your company stock.
A few things to consider:
- Is your company stock especially volatile?
- Do you need cash in the next 6-12 months?
- Are you comfortable with the risk of holding?
This isn’t one-size-fits-all—and it may change over time. Regular check-ins with your advisor help you stay aligned.
Why Partner With an Advisor?
You’re already juggling work, family, and everything in between. You don’t need another full-time job learning tax law and market trends.
That’s where a good financial advisor comes in. At Gates Pass Advisors, Erik Schei helps professionals turn complex RSU packages into understandable, actionable plans. You stay focused on life and work—he helps make sure your money keeps up.
Final Thought
Your RSUs aren’t just stocks—they’re stepping stones to the life you want. With a clear strategy, they can help you:
- Build a stronger financial foundation
- Make confident decisions during job changes
- Create flexibility for your family’s future
Want to feel more in control of your RSUs? Reach out to Erik and the team at Gates Pass Advisors to start the conversation.
Your RSUs have potential. Let’s turn them into progress.