A brand-new 22 year old nurse can easily earn >$100K in Nor Cal.
5 Likes
NYC also.
1 Like
Maybe not an investment decision yet, they may not be vested and so they could not sell those shares even if they wanted to.
And in many cases the employee paid income tax based on the value at the time they were given the stock, and now the stock does not have that value.
Like the NFL players who got paid in Bitcoin, paid income taxes the amount the Bitcoin was worth at the time and now they are at a fraction of the original value.
Not exactly. Let’s say company gave 100k in RSU over 4 years last December with one year cliff. Today it’s worth half because market dropped. You still can’t exercise your RSU because of one year cliff so your TC dropped significantly.
1 Like
It is also an investment decision to take the job in the first place, knowing that this is part of the compensation.
hmm… ok. not sure I understand. I guess it depends on whether the grant is in $ to be converted at the time of vesting into shares or just given in shares that vest at some point later. Are RSUs always given in shares?
They are usually given in actual shares or options - not in $
again - going back to my point of when you compare job offers - the companie will want the total compensation to look great but keep in mind that the only thing guaranteed and that goes forward is actual base salary
3 Likes
It’s important to specify rarity of starting 6 figure salary. With almost any major, it’s possible to have a six figure salary after undergrad, but in some fields/majors it’s far more common than others. As others have mentioned, cost of living is also relevant. $100k goes a lot further in a low cost of living area than a high cost of living area.
Focusing on high cost of living, which will I expect have the bulk of $100k salaries, the 25th/75th percentile range listed in the 2021 Berkeley grad survey is below. They are sorted by 75th percentile. There is a clear pattern. >$100k is standard for software engineers working in Silicon Valley. It’s not the norm for persons working in the vast majority of other fields.
75th Percentile >$100k
EE CS – $110k to $134k
Computer Science – $115k to $133k
Mathematics – $82k to $133k (most common job title is “software engineer”)
Statistics – $72k to $120k
Data Science – $75k to $119k
Physics – $57k to $115k (small sample, ~1/4 software engineer/developer)
Applied Math – $66k to $101k
75th Percentile <$100k
Mech Eng – $78k to $90k
Business – $71k to $90k
Bioengineering – $52k to $90k
Cog Science – $52k to $90k
Economics – $63k to $85k
Chemical Eng – $73l to $83k
Civil Eng – $45k to $82k
…
MCB; Cell Biology – $41k to $51k (STEM != high salary, depends on what field)
2 Likes
Another company trick is to give you your 401K match in company stock. Usually you can then covert that to other investment options, but some people don’t pay attention to that.
1 Like
The last time my daughter switched jobs I was helping her compare compensation for the new job vs. her current position. It was not easy to do.
The old job was a profit making company and compensation included stock and bonus (stock needed to vest and the bonus was based upon how well the company was doing that year).
The new job was a non-profit with no stock or bonus, but they were offering a sign up bonus and the health plan costs were significantly lower.
We needed a spreadsheet and to make assumptions about both companies (next year bonus for current company, possible promotion annual increase amounts at both places, potential health care costs for the year, etc.) It is not easy to compare apples to oranges, which is what job offers look like nowadays.
1 Like
I’m not sure but I think how any given company administers RSU grants is up to them. My wife receives RSUs as a given number of shares vested over time. Our S has a dollar amount that is converted to shares according to the vesting schedule. One more speculative than the other.
As they say there is more than one way to skin a cat. High COL vs moderate COL. Public vs private. College vs vocational. I have always said it is just as much about how much you spend compared to how much you earn. Having access to payroll at many different companies for over 25 years I have seen my share of high earners struggle in life.
1 Like
If you are going to be spending high anyway, may as well as have a high income. Otherwise you’d be more miserable :-). Just because you are high spending, it is no reason to be a low income person.
That’s interesting, because most young people I know do want to live in urban areas. The reason they don’t is the COL. The ones who are making enough money seem to like living there.
4 Likes
Not our experience, at least with our S. To him urban areas are places to go iff you must - for a show or a 3 Michelin star restaurant. Other than that they are to be avoided at all cost. Live in an urban area? Not him.
4 Likes
My D feels the same.
1 Like
Respectfully, you are mixing apples and oranges. You can be granted granted a dollar amount, with the number of shares determined by the fair market value at each vesting. This is how the majority of large tech companies do it. Alternatively, you can be granted a number of shares. Their value will be what they will be at vesting.
At multiple companies in my experience, the award letter includes a dollar amount and a date in the very near future (the Grant Date). At this grant date, the exact number of shares is determined. From there on out, the number of shares is set and the dollar amount varies. This was true for both RSU’s offered as bonus for signing on and for annual awards thereafter. The stated point of the RSU is for the employee to partake in, and have a stake in, the success of the company. If the dollar amount was fixed all the way until vesting that would partially defeat the stated purpose.
There is sometime an additional wrinkle for RSU’s awarded as at sign on. Instead of allowing the potential employee to try and ‘time’ the market, the price used to determine the number of shares at Grant is an average share price (maybe 30 days), instead of the price on a particular day.
1 Like
No I am not. The idea of deferred compensation is that you work to increase the stock price. If they give you a fixed dollar amount in the future you actually have an incentive to try to temporarily reduce the stock price right before each vesting.
FYI, your attachment contradicts you.
1 Like