What to do the week your RSUs vest

First, check what was actually withheld

Most employers cover the tax by selling a slice of the vesting shares, then withholding at the flat supplemental wage rate the IRS applies to bonuses and similar pay. That rate is a default, not a calculation of what you owe.

If your total income sits well above that flat rate, the withholding is a down payment rather than a settlement. The remainder does not disappear, it just waits until April. The fix is unglamorous: estimate the gap now, and either adjust your W-4 or set the difference aside so it is already handled.

Then decide whether you would buy the stock today

Here is the useful reframe. Because vesting resets your cost basis to that day's price, holding the shares is economically almost the same as taking the cash and immediately buying company stock with it. Selling triggers little or no additional capital gain, since you were just taxed at that value.

So the honest question is not "should I sell?" but "if this arrived as cash, would I buy this much of my employer?" Plenty of people answer yes, and that is a legitimate position. The point is to answer deliberately rather than by default, because doing nothing is also a decision.

Watch the concentration quietly building

Vests compound. Each one is a reasonable amount on its own, and four years later company stock is a third of your net worth without a single decision having felt significant.

This matters more for you than for an outside investor holding the same position, because your salary, your benefits, your bonus and your equity all depend on the same company. A bad year there can arrive on several fronts at once. That is concentration risk in the specific sense that should concern you.

Write the rule before the next vest

The most practical thing you can do is decide your policy in advance, while nothing is happening. Something like: sell a set percentage at every vest, hold the rest, revisit annually. Or: sell down to a target percentage of net worth whenever company stock exceeds it.

A written rule beats a judgment call made on a Friday afternoon during a trading window. It also survives the two moods that cause the most damage, which are euphoria after a run-up and paralysis after a drop.

• 01Confirm the withholding gap and where the shortfall is coming from
• 02Decide the hold-or-sell question as if the vest had arrived as cash
• 03Check what percentage of your net worth is now a single ticker
• 04Put the policy in writing before the next vest date