Author Topic: RSUs and post tax roth ira  (Read 515 times)

clairebonk

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RSUs and post tax roth ira
« on: October 14, 2020, 08:42:33 PM »
My company stock was high so I decided to sell most of my RSUs. Of course, it's gone up 50% since then but the trading window is closed for employees so it doesn't matter- it will probably come back down when the window opens. We were thinking of using the money to buy a rental property but that's not working out smoothly. So, what I'm doing is putting my entire paycheck into post-tax roth ira. I won't hit the $37k limit there, but I'll hit the $19k limit for pre-tax. My account allows for paperless transfer from post-tax employee account to post-tax etrade but every 2 weeks I have to call up to have it transferred. The person on the phone tells me it's not possible without 30 pages of forms, I say it is possible, we go back and forth until they understand, then it takes another 10 minutes. It's a pain but totally worth it!

Having RSUs and ESPP is like gambling and I hate it. How do you know when to sell and when to hold it?

tawyer

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Re: RSUs and post tax roth ira
« Reply #1 on: October 14, 2020, 08:51:33 PM »
Having RSUs and ESPP is like gambling and I hate it. How do you know when to sell and when to hold it?
I'm not a stock picker, so I have the same sentiment. For me, RSUs from my employers have never been part of my Investment Policy Statement, so I have always sold them immediately and invested according to my planned asset allocation. Informally, I think having stock and a job with the same company is too many eggs in one basket.

clairebonk

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Re: RSUs and post tax roth ira
« Reply #2 on: December 24, 2020, 07:49:27 PM »
Thanks for this advice @tawyer. We decided to sell all and refinance for 15yr at 1.85%.

secondcor521

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Re: RSUs and post tax roth ira
« Reply #3 on: December 24, 2020, 09:09:57 PM »
Having RSUs and ESPP is like gambling and I hate it. How do you know when to sell and when to hold it?
I'm not a stock picker, so I have the same sentiment. For me, RSUs from my employers have never been part of my Investment Policy Statement, so I have always sold them immediately and invested according to my planned asset allocation. Informally, I think having stock and a job with the same company is too many eggs in one basket.

I did the same thing.  I had a high tech employer with a high beta stock price.  I always cashless exercised the day they vested and then took the proceeds and applied them to whatever my next goal was.

seattlecyclone

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Re: RSUs and post tax roth ira
« Reply #4 on: December 25, 2020, 12:19:30 AM »
Imagine instead of RSUs your company paid you in beanie babies. Maybe the price of beanie babies goes up after your payday or maybe it goes down. Would you be worried at all about tomorrow's beanie baby price if your company paid you in cash to begin with? No? Then just sell the beanie babies and invest the cash into what you actually want.

How much company stock would you purchase if your compensation was all in cash? Hold that much. Sell the rest.

Car Jack

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Re: RSUs and post tax roth ira
« Reply #5 on: December 25, 2020, 08:59:13 AM »
Let's say that my company releases RSUs to me on Tuesday.  On Monday, I had put in a pre-emptive "sell at market all" order.  So the shares release and immediately sell.

This way, I avoid the problems like stock dropping to 25% of what it released at, which did happen to me at one company.  I do the same with ESPP shares.  Everything immediately gets turned to cash.  If I want it to go in the market, it'll go from cash to either SCHB or VTI.

Gronnie

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Re: RSUs and post tax roth ira
« Reply #6 on: December 25, 2020, 02:34:42 PM »
I have no problem deciding what to do with ESPP and RSU money -- sell it immediately and invest according to my IPS/goals!