RSU

Restricted Stock Unit

Equity compensation — company stock granted to employees that vests over time.

When you'd see it: Compensation, especially at public and late-stage private companies. RSUs are a major part of tech pay packages.

Why it matters: RSUs are company shares that vest over time, becoming real ownership and taxable income as they vest. They are simpler than options because they hold value even if the stock price falls.

Common mistakes: Forgetting RSUs are taxed as income when they vest, not when sold. The tax bill arrives at vesting whether or not you sell.