When your Restricted Stock Units (RSUs) vest, you’ve already earned the money. Now it’s time to think strategically about managing risk, not proving loyalty. For many professionals, that moment can feel like a vote of confidence, and it’s tempting to treat those shares as something to hold onto. But for most people, the smarter default is to sell.
RSUs Are Compensation
Let’s begin with a mindset shift. RSUs are not a gift, or a bonus; they are a form of compensation, just like a paycheck or a year-end cash bonus. However, unlike cash, RSUs arrive in the form of stock and are often accompanied by emotional baggage, the perception of company loyalty or fear of missing out (FOMO). If your company paid you $250,000 in cash, would you immediately use all of it to buy company stock? Probably not. When your RSUs vest, you’ve already “earned” the value, the next step is managing that compensation wisely, and that often means selling at least a portion, maybe even all. For a more in-depth understanding of Restricted Stock Units and how they work, view our blog here.
What Happens When You Don’t Sell?
You now own company stock, and unless you take action, you may be exposed to:
- Single-stock risk (all your eggs in one basket)
- Volatility (your wealth rising or falling with each earnings report)
- Liquidity risk (you can’t spend stock on groceries or tuition)
This is especially risky if your income, bonus, and equity are all tied to the same company. When the company does well, you win big. But if the company begins struggling, then your income may drop, your job could be at risk, and your portfolio takes a hit all at the same time.
What If the Stock Goes Up?
Yes, the stock might go up, and yes, you might miss out on future upside by selling. But here’s the catch, if you wouldn’t choose to invest in your company’s stock today with your own cash, holding RSUs is essentially doing just that, except passively investing by default. We’re not saying you should never hold your vested shares, but if you do, it should be a deliberate investment decision, not the path of least resistance.
A More Disciplined Approach
At Wealthspire, we often recommend a framework like this:
- Sell enough shares to cover your tax liability (if not already withheld in full)
- Diversify the rest if you’re already heavily exposed to your company stock
- Hold a portion but only if it aligns with your broader investment strategy and you’re comfortable with the level of risk
Some clients adopt a rolling sell strategy, automatically selling a set percentage of each vest. Others set upper limits on how much of their net worth they’re willing to tie to one stock. The key is to create a plan that feels proactive and rational, not reactive or emotional.
Doesn’t Holding RSUs Show Loyalty?
This is a subtle but powerful psychological hurdle. Some employees worry that selling looks disloyal, or that colleagues or managers will judge them for “cashing out.” In reality, senior leadership may even be doing the same thing through 10b5-1 plans. The market expects insiders to diversify; it’s normal, healthy, and financially responsible. Holding stock for optics is not a strategy, so never let guilt or politics stand in the way of smart planning. To learn more about some of the psychological barriers that an employee might have with the employer stock, view my colleague’s blog here.
Final Thought: Action Reduces Regret
Many of our clients worry about making the wrong decision, selling just before the stock runs up, or holding too long and watching value evaporate. These are valid concerns, but they’re not a reason to do nothing. The best antidote is structure. By creating a repeatable decision framework, grounded in tax planning, risk management, and your own financial goals, you reduce the weight of any single moment, and you trade guesswork for strategy.
Wealthspire Advisors is the common brand and trade name used by Wealthspire Advisors LLC and its subsidiaries, separate registered investment advisers and subsidiary companies of NFP Corp., an Aon company. © 2025 Wealthspire Advisors
This material should not be construed as a recommendation, offer to sell, or solicitation of an offer to buy a particular security or investment strategy. The information provided is for informational purposes only and should not be relied upon for accounting, legal, or tax advice. While the information is deemed reliable, Wealthspire Advisors cannot guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with regard to the results to be obtained from its use.
Wealthspire Advisors and its representatives do not provide legal or tax advice, and Wealthspire Advisors does not act as law, accounting, or tax firm. Services provided by Wealthspire Advisors are not intended to replace any tax, legal or accounting advice from a tax/legal/accounting professional. The services of an appropriate professional should be sought regarding your individual situation. You should not act or refrain from acting based on this content alone without first seeking advice from your tax and/or legal advisors.
Certain employees of Wealthspire Advisors may be certified public accountants or licensed to practice law. However, these employees do not provide tax, legal, or accounting services to any of clients of Wealthspire Advisors, and clients should be mindful that no attorney/client relationship is established with any of Wealthspire Advisors’ employees who are also licensed attorneys.
Please Note: Limitations. The achievement of any professional designation, certification, degree, or license, recognition by publications, media, or other organizations, membership in any professional organization, or any amount of prior experience or success, should not be construed by a client or prospective client as a guarantee that he/she will experience a certain level of results or satisfaction if Wealthspire is engaged, or continues to be engaged, to provide investment advisory services, nor should it be construed as a current or past endorsement of Wealthspire Advisors by any of its clients or a third party.
Registration of an investment advisor does not imply that Wealthspire Advisors or any of its principals or employees possess a particular level of skill or training in the investment advisory business or any other business.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the certification marks CFP®, Certified Financial Planner®, and CFP® (with plaque design) in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
