Projecting Your Total Compensation Including RSUs
Projecting Your Total Compensation Including RSUs
What is your total compensation? Do you actually know? Because I couldn’t tell you mine off the top of my head.
That is because much of my annual compensation is in the form of Meta Restricted StockUnits (RSUs) that vest every 3 months. Every time the stock moves, my “total comp” moves too.
Sure, if you just got hired you probably know the Total Compensation that was presented when you signed your offer letter.
But my current Total Compensation as of today? I have no idea….
That is until I reference the “Total Compensation” tab of my RSU Dashboard!
I hope you are excited for a new Google Sheet! I’ll walk you through how to create your own (and if you previously setup the RSU Dashboard it is even easier). This sheet is heavily modeled after an internal tool Google employees have that shows them this information.
Here is a preview of the new dashboard using Jane, our imaginary E3, who started in 2021 that we previously modeled. They didn’t get a promotion to E4 this cycle but are confident that they will get it mid-year.
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Step 5 to Avocado Fire
Welcome back to the series on the 10 steps of my 2023 financial plan.
Thus far we have covered:
Step 2: Estimating Your Tax Bill
Step 3: Optimizing My Emergency Fund
Step 4: Configure my 401k Contributions to front load hitting contribution limits
This brings us to Step 5: Model Out Total Compensation by Month for all 2023.
Astute readers might realized that I switched up the order of steps. Originally Step 5 was about purchasing iBonds. I am punting on my decision to purchase iBonds until closer to May 1st which is when TreasuryDirect releases updated rates.
Total Compensation Dashboard
I make all my dashboards and posts available free. This particular version is a little raw and requires a bit more manual entry of salary and bonus information. For the next 30 days if you upgrade to become a paid supporter at the Founding Member level I will do it for you (both the RSU Dash + Total Compensation Dash) and walk you through it over Zoom.
The Total Compensation Dashboard expands on the original RSU Dashboard many of you previously created.
For those who are new or never previously created their own RSU Dashboard, make a personal copy of the RSU Dashboard Google Sheet and follow the instruction on “How to Setup the RSU Dashboard” before returning here.
If you already have your own version of the RSU Dashboard the first thing you need to do is copy the new tab into your existing RSU dashboard sheet.
Direct Link to the Total Compensation Tab.
Total Comp Dashboard Setup
The hardest part of your total compensation is your RSU income. Luckily, after completing the initial step, your RSU compensation will automatically update. That means all that we are left with is Base Salary and any Bonus information.
Quick Notes:
The Monthly Salary values are pre-calculated based on Meta & Google’s bi-weekly pay schedule. This results in 2 months per year having a third paycheck (yay triple paycheck month). 2023 triple pay check months are March and September. You can manually change the monthly formula in cells B18:B29 if you are paid on a different schedule.
If you are promoted in 2023 you will need to manually adjust the overall Base Salary AND each of the monthly salary cells.
The RSU/Equity Value for future vests is the current stock price. For past vests they are the stock price on your vest date.
RSU Refresher: Depending on your employer, you may not have your most recent equity refresher (this is true in my house, waiting on META and UBER). You will want to update the data after you receive those. Since META historically has been formulaic, you could project your refresher the dollar value your prior year’s refresher divided by the current stock price vested over 16 quarters.
Updating Annual Salary + Bonus
Even though your RSU data is already populated we still need to update the data for Base Salary and Bonus. We will need to manually change these values.
Annual Base Salary: Change Cells B11:B14 with your current Base Salary. If you get promoted in 2023 be sure to have your Base Salary adjusted to account for how many months you were at each salary level.
Bonus: Update Cells C11:C14 with your expected bonus. Since these vary by company, role, level, individual performance, company performance…. how you include these is at your discretion. I prefer to assume default of 100% of my bonus percent at my level.
A note on my personal bonus: Meta shifted to annual bonuses and performance cycles away from twice per year. 2022 was a transition year and as such a portion of the annual bonus was paid in 2022.
RSUs & Total Compensation: These should be automatically populated.
Now we have an annualized view of projected total compensation at todays stock price.
Updating Monthly Salary + Bonus
Monthly Base Salary: If you work at Meta, Google, or another company on the same bi-weekly pay schedule and did not get a promotion you will not need to update the monthly salary information. The default formula is taking the base salary use in cell B11, dividing by 26 for the number of pay periods in a year, and then multiplying by the number of pay periods in that month (2 for all months other than March and September this year).
Bonus: The monthly bonus default is pulling the annual amount in B11 and entering it in March which is when my Meta bonus is paid out. If you bonus is paid differently you will want to manually update the C cells to account for this.
Now you can always check this doc to see what your current projected total compensation is!
If total compensation is coming up between your friends share this post with them!
Future Improvements
The current version is a good, quick, and dirty Total Compensation view that I was personally putting together for myself that I thought others would get value from. I am hoping to be able to greatly simplify this in the future in addition to adding a few other improvements.
Projected vs Actual: Currently projections will always update based on the current price. It would be valuable to see how the projections are changing overtime.
Stock Price Scenarios: Currently all future RSU vests are valued at today’s stock value. It would be good to be able to change this assumption to include Growth/Decline/Set Price to see how changes in stock could impact your Total Comp.
Historical Compensation: Currently it is only forward looking. It would be nice to have past total compensation to see how it has changed over the years like we have available in the RSU dashboards.
Taxes: Nice to have… but I really don’t want to hard code federal, state, and local tax brackets into a Google Sheet
I hope you enjoy this spreadsheet, it was a lot of fun to make! I am sure there are a dozen bugs, please let me know what you find.
-Andre
For the next 30 days, when you upgrade to become a paid supporter of this newsletter at the Founding Member level, and I will do the work for you by personalizing both the RSU Dash and the Total Compensation Dash and walk you through your dashboards over Zoom.
Thank you for creating these ready to use tools and templates + the guide to walk us through. It's been an empowering experience to add my data in and get a deeper understanding of my total comp and RSUs.