Anyone with a base salary of $300k can obtain a similar payoff structure by taking out a $550k loan to invest in GOOG, and taking out additional smaller loans at each stock refresh. The tax benefits from capital gains/losses and time-value-of-money benefits from getting your bonus sooner should handily outweigh the cost of servicing the loan, but even in a worst-case scenario where you pay interest for no benefit, that example Google offer would be a lot more comparable to a $315k-$330k salary, not a $1M+ salary.
On the other hand, this, my friend, is absolute nonsense:
> Anyone with a base salary of $300k can obtain a similar payoff structure by taking out a $550k loan to invest in GOOG, and taking out additional smaller loans at each stock refresh.
This is only equivalent if you ignore downside risk, which in the case of an average young professional with no significant assets could ruin you. The RSUs give you significant upside over 4 years with absolutely zero risk.
Also you said this:
> The fact that a particular investment decision (GOOG) can accidentally push the individual's yearly increase in net worth past $1M
This makes me think you might not understand how RSUs work. They are W-2 income at the valuation at the time of vest. What we're talking about is 7 figure annual income. Not investment gains over time.
No, they granted stock initially and set aside those shares for the employee. The market paid the employees the gain between the initial grant price and the sell.
> This is only equivalent if you ignore downside risk, which in the case of an average young professional with no significant assets could ruin you. The RSUs give you significant upside over 4 years with absolutely zero risk.
You didn’t understand the example. The person taking the loan gets $300k/year cash and the Googler gets $180k/year. Setting aside $120k/year for the loan makes the risk the same so you won’t be “ruined”. Google failing in either scenario means they each have $180k in annual cash leftover.
Anyone with a base salary of $300k can obtain a similar payoff structure by taking out a $550k loan to invest in GOOG
Also, ordinary banks might not advertise outrageous personal loans, but when your base salary starts at $300k and has a history of increasing (i.e., you don't _need_ the money and just want it to power a particular total comp over time profile, especially when you keep at least 50% of your total comp in cash rather than leveraged investments), most mainstream banks are more than happy to furnish somebody to personally service your account and make a loan like that happen.
Separately, if you live in parts of the country (US-specific) where salaries like that are common, you probably have a down payment of $200k+ if you have a mortgage and would have little problem grabbing a partially secured loan against your current equity.