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This is a sample client, created for illustration purposes. Interested in partnering with Java Wealth?
OVERVIEW
OVERVIEW
RESTRICTED STOCK UNITS
RESTRICTED STOCK UNITS
What are RSUs?
What are RSUs?
Restricted Stock Units, or RSUs, are a form of compensation from your company
Think of it like a bonus check that you get on a scheduled basis (called your vesting schedule). But instead of paying you in cash, you're paid in company stock
Watch this whiteboard explainer video to learn more about how RSUs work
Your RSU Income This Year
Your RSU Income This Year
Breakdown of this year's RSU income, including how much is earmarked for taxes
Looking at the Take Home amount, the question is "if I had that amount in my checking account, would I use it to buy my company stock?"
If YES - Continue to hold your vested RSUs
If NO - Sell your RSUs as soon as you're able to
Estimated Taxes Due?
Estimated Taxes Due?
A common "gotcha" with RSUs is that not enough taxes are withheld by default. This shows the additional amount to be put aside/paid quarterly to cover the full tax bill
Federal
The supplemental tax rate is 22%
Your estimated marginal tax rate for this year is 32%
Additional federal tax: 10%
State
The supplemental tax rate in CA is 10.23%
Your estimated marginal tax rate for this year is 12.3%
Additional state tax: 2%
Your Annual RSU Income
Your Annual RSU Income
This is the pre-tax value of all of your RSUs that are scheduled to vest in the future
If you are thinking about leaving your job, understand how much you're potentially leaving on the table
If leaving for a new position, use this information to negotiate the new company "making you whole" through equity grants, annual bonuses, and/or a signing bonus
INCENTIVE STOCK OPTIONS
INCENTIVE STOCK OPTIONS
What are ISOs?
What are ISOs?
Watch this whiteboard explainer video to learn more about how ISOs work
Your Current Stock Option Values
Your Current Stock Option Values
This is the pre-tax value of your options if you were to sell today
There is also "time value" to consider. See the analytics section for more detail.
ANALYTICS
ANALYTICS
In-The Money Value vs. Time Value
In-The Money Value vs. Time Value
The total value of stock options can be broken into two categories:
In-The-Money Value: This is the actual dollar value based on today's stock price
Time Value: This attempts to measure the probability that the stock price will be higher between now and when the options expire. As the options get closer to their expiration date, the time value decreases.
Leverage Analysis
Leverage Analysis
"How much upside is still in this option?"
If the stock price is close to an option's strike price, your leverage is high. Even a small stock price increase can greatly increase the value of an option. In other words, there is still a lot of upside to holding on to the option
If the stock price gets well above an option's strike price, your leverage decreases. Most of the upside has already been realized. Stock price increases have less effect on the option value.
Here is a whiteboard video illustration of how leverage works
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