If part of your pay is stock, you have the most predictable variable income there is: the dates are printed on the grant, and the only unknown is the share price. Yet most people treat each vest as a surprise, leave the shares sitting in the broker, and wonder in April why they owe tax.
This guide is for anyone with RSUs, at any company — the method is the same whether the ticker is famous or private. It treats vests as what they are: pay, paid in shares, on a known date.
1Put every vest date on the calendar with a conservative value
Take the grant document. Write out the vesting schedule: the cliff if there is one, then each quarterly or monthly date and the share count. Value each vest at a price 20% below today's — not because the stock will fall, but because a plan that survives a 20% drop is a plan.
A $160,000 grant vesting quarterly over four years is 16 vests of about $10,000 at today's price. In the plan, they're 16 expected income events of $8,000, each on its date.
2Take out the tax you'll actually owe, not just what's withheld
On the vest date the shares' value is ordinary income. Your employer usually sells some shares to cover withholding — typically the 22% federal supplemental rate (2026) plus FICA and state. If you earn enough that your marginal rate is 32% or 35%, that withholding leaves a gap you'll owe at filing.
The RSU tax calculator shows the gap for your income and state. Plan on netting 55–65% of each vest's value once the gap is covered, and set the difference aside the day the shares land.
3Decide sell-or-hold as a rule, not vest by vest
Holding vested shares is an investment decision: would you buy $10,000 of your employer's stock with cash today? Most people wouldn't, because their salary already depends on the company. Selling at vest has no extra tax cost — the shares' cost basis is the vest-day price, so an immediate sale has almost no gain.
Pick a rule and write it down: sell all at vest, sell all but a fixed percentage, or hold up to a cap (say, no more than 10% of your investments in one company). A rule made calmly beats sixteen decisions made on vest days.
4Assign each vest to a goal
Now the vests are dated, after-tax, and in cash. Give each one a job. Some people run vests entirely to long-term investing and live on salary. Others assign the next four to a house down payment and the rest to retirement. The point is that the assignment is made once, up front, so the shares don't drift into checking.
In the plan, this looks like a lump sum matched to a goal: "March 15 vest, ~$8,000 after tax, → house fund." The monthly contribution to the house fund drops accordingly, and salary has more room.
5Keep salary and stock in separate lanes
The failure mode with equity pay is letting the lifestyle grow into the stock. Rent, car, subscriptions — the recurring things — should fit inside salary alone. Stock funds goals and investments. Then a bad year for the stock is a slower house fund, not a missed rent.
The comp comparison calculator is useful here even with one job: it shows how much of your total compensation is stock, year by year, so you know what fraction of your pay is actually at the mercy of the share price.
6Re-value the schedule when the price moves, and watch the refresh
Twice a year, re-value the remaining vests at the current price less 20%. If the stock has run up, the goals get closer and you may want to raise the sell percentage; if it has fallen, the goals move out and salary carries more. Refresh grants add new dates to the calendar — put them in as soon as the grant is signed, not when they start vesting.
The plan, in Allocate
You'd say: "I have $160k of RSUs vesting quarterly over four years, next vest March 15. Sell at vest and put them toward the house." The plan Allo-Bot proposes:
- Expected income: RSU vest, quarterly on the 15th of Mar/Jun/Sep/Dec, planned at $8,000 after tax each (share price −20%, 22% federal + FICA + state withheld, $900 set aside for the withholding gap).
- Rule: sell all shares at vest; proceeds land in the house fund.
- House fund: $32,000 from the next four vests plus $600 a month from salary; $40,000 target reached next March, four months earlier than on salary alone.
- Salary lane: essentials and everyday spending fit inside take-home with $1,100 a month to spare; stock never touches rent.
- Re-check: each vest day, the brief shows the actual amount against the plan and proposes the difference's destination.
If the stock drops 30% before June, you say "re-plan at the new price" and the house date moves out with the changes staged for your yes — the plan bends, the rent doesn't.
Frequently asked questions
Do I pay tax when RSUs vest or when I sell?
Both, potentially. At vest, the full value is ordinary income and is withheld on. At sale, only the change in price since the vest is a capital gain or loss — which is why selling at vest costs almost nothing extra in tax.
Should I hold my company's stock for long-term capital gains?
Holding a year after vest turns future gains into long-term gains, but the vest-day value has already been taxed as income; holding only affects growth from there. Weigh that small tax benefit against having your salary and your savings tied to the same company.
What if my company is private and I can't sell?
Plan the vests as income you can't touch yet: count the tax you'll owe (a double-trigger grant defers it, a single-trigger one doesn't) and keep them out of any goal with a date. Salary funds the dated goals; the shares are upside.
This guide is educational and uses invented numbers — not investment, tax or legal advice. Your income, taxes and goals are your own; talk to a qualified professional about your situation.