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Nobody is going to pay you before you do the work, but “Time value of money means it’s better to be paid money today than in 5 years”

Thus, 10M in RSU that vest in 5 years > 10M in cash today (not a real option) > 10M in cash in 5 years.

However, this also helps explain 5%,15%, 40%, 40% vesting schedules they are somewhat better than 25%,25%,25%,25% for the company because it better incentivizes staying and for the employee due to tax advantages.

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But there are no tax benefits. If you get 10M in RSU that vest in 5 years and in 5 years when they vest they are now worth 20M, you get taxed for 20M of income and not 10M income + 10M cap gains.

This gets more into the weeds, RSUs rarely vest evenly across time. A 10,10,40,40 has tax advantages over a 25,25,25,25 vesting schedule. Further, RSUs are only one aspect of a compensation package.

If someone can negotiate both RSUs and a golden parachute then they are simply better off than taking that exact same salary in cash. The nuances of every contract are different, but it’s not difficult to construct something more advantageous than cash.

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