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Comment by olliej | Hacker News Reader

It’s important to realize that when people are throwing around 3,4,500k etc at FAANGs they’re not generally reporting the base salary, but rather salary + RSUs.

The vast majority of FAANG jobs are below 200k base salary, but if you then throw in a few 10s of thousand in bonuses, a few hundred k of stocks vesting, and suddenly you get to stupid levels of income (worked a multiple FAANGs as a reasonably high level IC)

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That's fair. This may be better phrased as "total semi-liquid comp of $200-300k". So not $200k all-cash, but also not $90k cash + (maybe $10mm but probably $0 in options).

200 is not base yet in SF and NYC?

Can’t speak to NYC, but 200 seems to require a degree of seniority in the Bay Area.

But again RSUs are a huge part(for example they make half my income in my taxes this year)

Why are you acting as if RSUs are not real money? As soon as they vest, I pay taxes on them. As soon as they hit my brokerage account, I can sell them and spend the money.

Well, if you were paid $0 base salary, but $300k at the end of two years if you meet some high level of performance and keep it there the entire time, does that count as money? I wouldn't put money on that money. You can't pay a mortgage with that money, or feed your kids, or pay rent.

Major tech companies have a vesting schedule where you are guaranteed to get the stated amount of shares on a certain date. I knew the minimum number of shares I would get for the first four years after I got hired. After that, I will know for two years in advance.

Ya but if anything happens to prevent that schedule from taking place, you won't get those shares. Is that not correct?

Anything happens like you lose your job before the six months is up?

That’s just like saying if they agreed to pay you $250K in cash, and you lost your job in June, you wouldn’t get the other $125K.

But if we are talking about the 5 largest tech companies - Facebook, Apple, Amazon, Microsoft and Google, I doubt they are going to be so distressed that they are going to not pay their RSUs.

The difference in my mind is that you have a certain amount of liquid income paid to you gradually, probably twice a month. I feel like it's more comparable to a cash bonus, except that it's a different asset and different period. So if you lose your job before that 6 months, or whatever the time period is, you're still paid money from your salary, but only that. But perhaps I misunderstood something about RSUs or one of your previous comments. As a contractor, even cash is risky the longer you draw out the payment period and terms, and there's also time-value of money to consider.

I live in a medium cost of living area so my base covers all of my living expenses. I use my RSUs for savings, vacations, and big ticket items. It’s about getting into a certain rhythm.

Let’s say I get my RSUs in June. I have them set to sell as soon as I vest and now cash is just sitting in my brokerage account. At the beginning of every month, I have $1500 transferred to my main checking account. That offsets the deficit I have in my monthly budget after I have retirement savings deducted from my regular account.

If I were getting the money monthly, I would save for big ticket items every month. I know I’m getting a net around $25K in six months, so I just allocate that.

But in the grand scheme of things we are only talking about six months in the whole. It is slightly different from a bonus since statistically, you would expect your RSUs to go up over time. Your “bonus” is going to be worth more than the initial stated value. If you are granted 100 RSUs over 4 years when the stock was worth $100, even if they just go up with the rest of the stock market, the last amount will be worth 30% more when you vest.

But this also assumes we are talking about the big 5 profitable tech companies and not places like Uber and Robinhood.

Thanks for the overview, I do find it interesting to see how other people manage things. Like you say though, you're making a calculated risk assessment and allocating money ahead-of-time accordingly, and you also have a base salary and stability such that it makes sense to do so. I think if I were offered a new job, even at one of the big 5 (that isn't really in the cards fwiw), I wouldn't consider the same bet until I could all but guarantee that I'd have the job after that period of time. Particularly with a lot of people moving jobs in the last year, and with economic volatility, I think that's an appropriately conservative move to make for a lot of people. Would you disagree? Did you set out to do what you described as soon as you got the job and simply assumed that you'd have it 6 months, 1 year etc.. later? I personally hedge against having work 6 months out, but tend to account for that bias if I'm talking in generalities and be a little more optimistic. (high cost of living area, extreme income volatility, extremely unstable career, no savings, not a big spender etc..)

Being at one of the Big 5 was never on my radar. I never practiced for an interview as an SWE. I only slid in through Enterprise dev+cloud experience in the consulting department.

So, I was trying to speak about what I will be doing because it is much more generally applicable to most places than what I am doing.

Amazon is weird in how your initial four year offer works.

Year 1: base + prorated signing bonus every pay period + 5% of your four year RSU vest.

Year 2: base + prorated signing bonus (a smaller amount) + 15% of your four year vest

Year 3 and 4: base + 40% of your four year vest.

Then after that you get more stock to keep you about even.

So out of the initial signing bonus - which if your total compensation is $200K, expect year one to be $50K distributed throughout the year and year two to be about $35K. I am using the first two years to pay off debt (to reduce my monthly expenses) and to build up savings so I could meet all of our monthly needs out of my base after year 2. I said earlier I “retired my wife”. It wouldn’t have been possible to live just on my base without getting rid of debt.

I am completing year 2 the middle of this year.

As far as riskiness. My wife is keeping her CDLs up to date so she can go back into the school system if needed. Not for the money, for the benefits. I can always do independent consulting if necessary. With my being able to say “I worked in Professional Services at AWS” gives me an amount of credibility I wouldn’t have had before.

The phrasing of the question seemed to reflect the fairly common belief that the giant FAANG figures people throw around are the base salary.

This is a problem that repeats in all the salary+wage transparency bills. Most of the intended targets already have established level->salary bands, discriminatory comp is largely through bonuses and stock (RSUs, options, etc).

He clearly stated that there was “plenty of data on levels.fyi”. He knows that the total compensation includes RSUs/bonuses if he looked at the data.

Options in private companies are statistically meaningless, they are close to lottery tickets.

Yeah, I am aware that a significant part or majority of comp at FAANGs is in equity grants. I agree that options in private companies are realistically meaningless, especially if you’re trying to pay a mortgage, somy question here is specific to cash/bonus comp for senior roles.

RSUs are just as good as cash. I have mine set to “sell all” when they vest. The cash shows up in my brokerage account (after taxes). It’s just more “lumpy”.

Oh totally. I just mean to say that since most companies in this bucket probably aren’t public and offering RSUs, cash matters more here. Or that’s my guess, at least.

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