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Why I would never accept an offer with stock options or RSUs

As a contractor based in Poland.

Adrian Bednarz
6 min readOct 11, 2022


Total compensation start to tempt more and more people. For the folks working for FAANG they are not anything new — they’ve been getting stock options or RSUs for a long, long time. As I am browsing job offers in my inbox, I see more and more companies trying (consciously or not) to scam greedy engineers. People from remote parts of the world are oftentimes tempted by the compensation packages offered by the companies. In theory this is a win-win situation — people earn more than they would in their local market and companies get a talent at a fraction of a cost.

According to, average base salary for Senior Data Engineer in the US is 125k USD whereas average salary in Poland is 48k USD. That is a huge gap and that’s why it is reasonable to hire European teams and contractors to get the job done.

Things get even more interesting if we start talking about stocks. In digitalized age, a lot of people already have been trying investing — be it via old-school stocks or ETFs, including risk-assets like derivatives, options, forex and of course crypto. The urge to earn that lambo with no effort is so tempting. With so many influencers claiming to have earned their wealth investing tricks our brain to believe that stock market is for everyone.

My personal take on this is that majority of people are not born investors, especially engineers. We should grow our knowledge and experience to build better systems and not waste our precious time looking at the charts for whatever reason. Overanalyzing is not something that helps in the market. It would be ideal for us to have high-yield savings accounts so that we don’t need to worry about the excess of money. But that’s a topic for another story.

So, being an engineer you will be tempted two-fold to accept an offer with stock options or RSUs

  • you can see yourself earning a huge leverage on the stocks
  • you actually believe this is way more true than it is likely for you to hit big. Even in a huge public company.

What the heck even are stock options or RSUs?

Both are forms for you to own equity in a company.

With stock options you have a right to buy stock of a company at some later point in time (vesting period — usually 4 years). If you get 1000 stock options at 70 USD a share and the company stock is going to be priced at 100 USD in four years, you can exercise your options for immediate profit of 30 USD a share — gaining 30k USD. Options have expiration period — a time in which you have a right to exercise them once they become vested. If your company doesn’t do so well and the stock ends up being priced at 60 USD a share throughout your expiration period, you have no obligation to exercise them — effectively losing nothing.

With RSUs you are given stocks that can be sold by you only after certain period of time. Thus they usually count towards your income (you have to pay the tax after the vesting is over, even if you don’t plan to sell them) but that varies from country to country. Apart from that, they behave just as any other stock.

The more you work, the more valuable they become — do they?

This is the most frequent argument brought up by the companies. You become a part of a company — and quality of your work have direct impact on the amount of money you earn off your equity. Unfortunately for you, this is usually a lie.

  • first of all, you are not working alone. Company performance is a team effort and you can’t rely on all the people working as hard as you or not trying to gain unfair advantage over you. History knows stories where company owners dumped stock price before they allowed their employees to exercise their options,
  • equity is usually offered by startups in pre-IPO phase. Initial stock price that your hiring manager is going to refer to is not verified by the market and it can go any way. I encourage you to take a look at the tech companies that went public in 2022 and see where their stock price is right now vs where it was at the IPO. Keep in mind that most startups fail,
  • actually, any company can fail. A good example to research on your own is Sears. We haven’t experienced a huge fail in tech sector yet but history has thought as that every bubble has its end,
  • you are less diversified. Betting on a single company in the stock market is a bad strategy in the long run,
  • less flexibility. You are stuck with a company that might not be a great fit for you.

On the other hand, companies would prefer you to choose stock instead of base salary. This leaves more money in their bank and with the system based on inflation and debt, postponing any payment is usually a good strategy. They also keep you for longer time — if you leave before your vesting period is over you are going to lose some part of your equity.


Finally, some people will again be tempted more than others based on their local laws. I am not based in the US but based on my research

  • for stock options — you pay income tax on a difference between stock price and their market worth. With option to buy for 70 USD and market value of 100 USD you pay income tax on 30 USD a share. If you decide to hold this stock, you will later pay income tax on possible further gain (as if you bought this stock at 100 USD a share)
  • for RSUs — you pay income tax on a stock value once they are vested. If you get a stock worth 100 USD a share, you will pay income tax on 100 USD. If you decide to hold to that stock and it grows it value, you will pay a capital gains tax on the difference.

In general, income tax is way higher than capital gains tax. We saw how the situation looks in the US for instance in Poland they are both subject to income tax only. You get a significant tax advantage if could convince your employee to pay you in stock — 32% to 19%.

If you are a contractor though, you are more flexible with the way you choose to pay your taxes. Many IT professionals are paying 12% income tax instead of 17%/32% tax on revenue due to the low costs of running contracting business. In their case, getting paid in stock is actually a disadvantage.


Being a contractor myself and given the tax scheme I use for my business, it is more beneficial for me to not be compensated in stock. And even if I had opportunity to get stock, I would consider it as an addition to market value salary — not a means to become a billionaire or a lucky lottery ticket. Investments involve risk and there is a reason why you should invest the money that you can lose.

The content of this blog post is not an investment advice and does not constitute any offer or solicitation to offer or recommendation of any investment product. It is for general purposes only and does not take into account your individual needs, investment objectives and specific financial circumstances. Investment involves risk.