Question 1

How do RSU vesting schedules work?

Accepted Answer

RSU (Restricted Stock Unit) vesting schedules determine when you receive shares over time. Common types include: equal vesting (e.g. 25% per year for 4 years), cliff vesting (nothing until a cliff date, then a lump vest), and backloaded vesting (e.g. Amazon's 5%/15%/40%/40% over 4 years). Each vested tranche is taxed as income at the stock's fair market value on the vesting date.

Question 2

What is a typical annual raise percentage?

Accepted Answer

The average annual raise in the US is typically 3-5% for standard merit increases. High performers may receive 5-10%, while promotions can add 10-20% or more. In tech, total compensation growth often exceeds base salary growth due to equity refreshers and bonus increases.

Question 3

How are signing bonuses and RSU grants taxed?

Accepted Answer

Signing bonuses are taxed as supplemental income, typically at a 22% federal withholding rate (37% if over $1 million). RSUs are taxed as ordinary income when they vest, based on the stock price on the vesting date. Any subsequent gains or losses when you sell the shares are taxed as capital gains. This calculator projects gross (pre-tax) compensation — use the Take-Home Pay calculator for after-tax estimates.

Question 4

What is a backloaded vesting schedule?

Accepted Answer

A backloaded vesting schedule front-loads the waiting and back-loads the payout. Amazon's famous 5/15/40/40 schedule gives you only 5% of your RSU grant in year 1 and 15% in year 2, but 40% in each of years 3 and 4. This incentivizes employees to stay longer. Other companies may use different splits — this calculator lets you model any custom distribution.

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Cumulative Earnings

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Total Compensation Breakdown

Year-by-Year Breakdown