RSU Vesting Windows: A Simple Framework for San Diego Tech Professionals
If you work in tech, biotech, or defense anywhere from Sorrento Valley to Torrey Pines to Carmel Valley, chances are a meaningful share of your compensation shows up as restricted stock units rather than cash. That's a good problem to have — until a vesting date arrives and you're staring at a tax bill and a decision you didn't plan for.
Why Vesting Day Feels Simple But Isn't
RSUs are taxed as ordinary income at vesting, not at grant, based on the fair market value of the shares on that date. Many equity plans withhold at the IRS's flat statutory rate for supplemental wages, which frequently under-withholds for higher earners — meaning the amount taken out at vesting may not cover what's actually owed. On top of the tax question, every vest that isn't sold adds to a concentrated position in a single company's stock, often the same company paying your salary.
That tension — between wanting to diversify a concentrated position and not wanting to trigger a large capital gains tax bill by selling — is one we see often. One current client holds roughly $600,000 in highly appreciated RSUs from her employer, making up about 30% of her total assets. She'd like to redeploy some of that into other investments, but the tax hit from liquidating a large appreciated position is exactly what's holding her back from acting. It's a genuinely difficult tradeoff, and there's no one-size-fits-all answer — it depends on the rest of your financial picture.
A Framework Worth Walking Through
Rather than treating each vest as an isolated event, it can help to evaluate a few questions each time shares vest:
Where does this vest land in your tax picture this year? A large vest can push income into a higher bracket, which is worth confirming with your CPA before, not after, the date.
What's your withholding actually covering? Comparing your equity plan's default withholding against your projected total tax liability is something your tax preparer can help estimate, so there are no surprises at filing time.
How concentrated is your position getting? There's no universal rule for how much of one company's stock is "too much" — it depends on your total balance sheet, your risk tolerance, and how tied your income already is to that employer. The SEC's own investor guidance on diversification is a useful starting reference, but this is worth evaluating with a financial professional rather than deciding by feel.
Does this vest change your cash flow plan? Selling shares to cover taxes, fund a goal, or rebalance is a decision best made deliberately, coordinated with whatever else is happening in your financial picture that quarter.
The Real Work Is Coordination
None of these questions are complicated on their own. What tends to go wrong is treating them separately — letting a CPA handle taxes in isolation, letting a 401(k) run on autopilot, and never stepping back to see how a vesting schedule, a mortgage, and a retirement timeline actually fit together. For high earners in San Diego's tech and biotech corridor, that coordination gap is often a bigger drag on progress than any single decision.
If withholding surprises are a familiar feeling, our post on the withholding trap behind surprise RSU tax bills goes deeper on that specific piece, and Your RSUs Just Vested. Now What? walks through the decision points right after a vesting date.
A complimentary conversation is a reasonable place to start if you want a second set of eyes on how your equity compensation fits into your broader plan. You can review the San Diego H.E.N.R.Y. Strategy for a closer look at how this kind of coordination typically works, and what a complimentary review with our team covers.