Being the owner of Employee Stock Options but keeping it lying idle may not be the best of idea. We at GrowthAdvisor can help you to exercise your stock options and get the most benefit.
Want to get the most value from your Employee Stock Options (ESO)? Then you’ve come to the right place. Below is the approach that can help you dramatically increase your gains.
For example, if you’re making $20,000 from your Employee Stock Options per year, you could be making $40,000. Or $80,000. Or even $200,000.
In this post you’ll learn:
- How Employee Stock Options work;
- How to get more out of your Employee Stock Options;
- 10 things that only GrowthAdvisor can do;
But first, let’s cover stock options basics.
How Employee Stock Options work
Many companies give out Employee Stock Options to their employees as part of the compensation package. It’s considered a nice perk that can lead to a wealth of opportunity.
But most employees have no idea how to use this perk! Let alone how valuable it is—or how to get the most value out of it.
Why do companies offer Employee Stock Options? Because Employee Stock Options give new hires a stake in the company. This, in turn, helps retain top talent. After all, if you own part of the company, you’d want it to succeed. Except options aren’t shares. Not yet. Not until they’re exercised.
Simply put, Employee Stock Options are your right to purchase company shares at a fixed price, on a fixed future date. Which gives you the advantage to then turn around and sell those shares and make a profit. This assumes that the price of the shares has gone up since the day you got your options.
See how this works as an incentive to perform?
This all sounds great, but. (Of course, there is always a but.) Unfortunately, the math to calculate your stock options value is quite complex. And it changes with time.
That’s why we created GrowthAdvisor. We want to help you understand your Employee Stock Options inside and out. And we want to make it easy and fun.
With our tool, you can make smarter career decisions:
- You can easily navigate the job market while armed with information that not many people have access to.
- You’ll know the accurate value of Employee Stock Options any company gives. And we mean it, any company. Just enter any company in your account and see for yourself. It’s free.
- You’ll make the most money and reach financial independence that much faster.
Now, let’s cover some not-so-exciting but important details about Employee Stock Options. You’ll come across these if you read your Employee Stock Purchase Plan (ESPP).
Employee Stock Options Prices
- The Grant Price (or the Exercise Price, or the Strike Price) is the price at which you can purchase a stock. So basically, it’s a price to buy the company shares.
- The Market Price is the current price of the stock on the market. Ideally, it’s higher than the exercise price. But if the Grant Price is higher than the Market Price, then you’re considered to be “underwater”. Hopefully, this won’t be the case for you.
Employee Stock Options Dates
- The Issue Date is the date when you get your options.
- The Vesting Date is the fixed future date when you can exercise your options.
- The Exercise Date is the actual date when you exercise stock options and purchase company stock.
- The Expiration Date is the date by which you have to get your options exercised, or they’ll expire (that’s why they’re called “options”).
How to get more out of your Employee Stock Options
Not to toot our own horn again, but we know this from experience! We’ve done many case studies where employees were able to dramatically increase their earnings. Just read Nathan’s story
to see how he got from $40,000 per year to $80,000 per year.
So, we can help you optimize your career by setting up your income goals and by giving you the data you need to ask for higher compensation. You’ll know exactly how much that compensation is.
This data is invaluable for salary negotiations—when negotiating for a raise at your current job or a higher new job offer.