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Career

2021. How Can I Make This Year Good?

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Two weeks. Two weeks until I go back to work from my maternity leave. How did that happen? Where did the time go? Sure, I had a baby and he has DOUBLED in size since he flew out of me all of 3 minutes and 3 pushes, but what else happened? Wasn’t I going to unpack all of the stuff from when we moved into this new house at the end of last year? Finish my wedding album I’ve been postponing due to PTSD from my wedding day? Make a portfolio? Learn a lot of things to change careers? Spend quality time with my kids?

At least for the time being I can work from home. It sounds like companies overall are leaning towards having employees come back to the office sooner than later now that people can get vaccines. I actually started my vaccine regiment last week (legally) due to a health condition (ok I gain too much in pregnancy and haven’t lost enough yet) and I have my second vaccine date scheduled in two weeks. My arm is busted and I’m concerned it won’t get better again but I think that’s probably due to poor administration of the vaccine than the vaccine itself. Anyway. I’ll be vaccinated so if my work says everyone vaccinated needs to go back I’ll need to go back. Fuck. Suddenly moving an hour-and-a-half from the office, permanently, doesn’t seem like such a good idea.

Although. The whole moving an hour-and-a-half from the office WAS a good idea because it means I won’t stay in this job that makes me miserable even if I don’t get fired. I’m still wallowing in self pity as my work-friend-who-told-me-he-was-quitting-a-few-zillion-times-prior-to-getting-my-job seems to be thriving. I know he’s not the malicious type and he managed to win the position by being, you know, reliable and strategic and stuff, so I can’t be mad at him. But it still hurts. And the worst of all of it is how I wrote a note to my former boss who is now my boss’s boss about how I fail all the time at everything etc etc when I was manic and cried a lot in front of her and, well, that was nail in my coffin that’s been long built waiting for me to be buried six feet under.

I’m TRYING to focus on being positive in this grande return to the office. I know it’s not a forever return, just a return until I get my stock and can move on to whatever is next. And I want to do a good job. It’s 12 months. That’s forever but also not a lot of time at all. If I break it down into 4 quarters, I just have to figure out what I need to do in each quarter to add value and not make anyone’s life harder than it is. That means 1. getting all my shit done on time and 2. keeping my mouth shut. No great ideas. No creativity. No wanting to improve things from the way they are. None of that. If I have any chance of surviving the next 12 months, it’s being forgotten as much as possible and being reliable/dependable when people do notice me. That’s it. I’m not chasing a promotion. There will never be a promotion. I’m at a dead end and the walls are closing in. So what? That’s ok. I can play the game as long as the game is still allowing me to play.

Job postings continue to depress me. I’m trying not to worry about that too much, but odds are I’m going to have to take a step back no matter what next is, even in the same field. That’s ok, though. I just have to get lucky to get into a company that wants to help employees move up over time. One with bosses who mentor their employees. Maybe I can find a better fit. I don’t know. I’ll certainly try. In 12 months. Or less. I made this this long, what’s another 12 months really? The longer I can work remote in those 12 months the better. Head down. Get work done. Hide. Hope they forget me. But not enough to get rid of me. Please. I hope. I hope I don’t come back form maternity leave and immediately get fired. For those projects I didn’t finish. But I went out earlier than I planned due to health reasons.  I’m hoping that won’t be enough to kick me out. Not yet anyway. Maybe I’ll have 3-6 months to prove myself. And I can hang on. I can do my work. Whatever is thrown at me. I won’t be a rockstar. I’ll be the opposite of that. Hiding in plain sight.

I’m feeling lukewarm about my prospects of survival this year. I’m trying to accept if I don’t make it then it’s not the end of the world. It will be very sad to miss out on the remaining stock. That’s about $683,000 in 12 months. Even on the high end at another job the most I’ll see is about $250k-$350k for 12 months. And likely it will be less than that. I make it to June, and I’m looking at $585k lost in 12 months. By Jan that slides down to $285k for 12 months and by April “just” $250k. This year is worth it. Next year starts opening up the possibility of finding a job that puts me in the running to make a similar amount, or at least find a public company with stock that’s growing so my income goes up again vs goes down.

I am NOT looking forward to my belated performance review that will be all sorts of icky. I know I got a chunk of my bonus so hoping that means I’m not getting fired immediately. It’s the first year I didn’t get all of my bonus so that’s not a good sign, but I still go most of it. Would be kind of strange to give me most of my bonus then fire me — but stranger things have happened, right?

The funny thing is I’m kind of looking forward to going back to work. I feel incredibly unproductive right now. I need some sort of structure to my days. I just wish it didn’t take up my ENTIRE day. If I can find a job that offers flexible schedules, that would be ideal. Until then, I’m gonna hold my breath and push through the rest of this year. Even nine months before I’m ousted would be a huge victory. I have to do this. I hope I can.

Investing

Rebalancing my Tech Heavy Portfolio

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I still remember when I purchased my first few shares of individual stock in my “fun money” account. My rule to myself was put most of my money in index funds and throw some money at tech companies because why not. I bought some apple, some amazon, some Netflix, and a few other companies.

Over the years, I bought more shares of tech companies. It was fun watching them increase in value. I sold off the losers. They kept growing. I kept throwing extra money at tech companies because I had maxed out my IRA or 401k and index funds outside of my retirement accounts seemed just – boring. Dumb, I know.

I just took a look at my large cap stocks (not counting the $ in 529) across both taxable and retirement accounts (in both my husband and my accounts) and it’s about 68% tech, 22% index funds and 10% non tech individuals stocks. It got extra overweighted in tech when I decided to hold on to my company ESPP — which was a pretty good move in that it has multiple in value quite a bit but bad in that it has me way overweighted in tech. I plan to sell off a bit of it when I leave the company on a bad year (since a chunk of it will get taxed as income and my cap gains tax rate can be very high.) Nonetheless, I’m wayyyyy overweighted in tech. It’s relatively concerning. $549.4k concerning, to be exact. Plus any of the $180.4k in large cap index funds that is in tech.

Overall, these tech stocks are 33.7% of our portfolio. It’s too much. But I don’t want to sell off the tech stocks I have (outside of the ESPP which I’ll sell off once I’ve left the company and earn less), I want to invest elsewhere with future savings to balance everything out. But that may be a bad idea should tech crash and burn this year, which is might. I’ve already lost a lot (can’t keep up with it) by holding my RSU vs selling off immediately on vest.

My new rule is that I won’t buy any more tech stocks. If I want to buy any tech stocks I need to sell some of my existing tech stocks and buy new tech stocks with the proceeds. This will be hard because I always want to buy new tech stocks that I think will do well. But I need to stop that because at this point it’s gambling not investing. And it’s not just my money, it’s my family’s money (all of my husband’s savings are in index funds but now we’re managing the family portfolio jointly.)

At least my emerging markets, small cap and international funds are all in index funds. It’s just my large cap portfolio that’s a mess. And that’s not good since large cap is supposed to be the most stable part of my portfolio. Yikes.

What should I do? Sell off a chunk of my tech gains and take the tax hit or hold and focus on building out the portfolio around these stocks so their weight goes down?

Career, Career Change

When To Move On From This Job — If By Choice, It’s a Numbers Game

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Due to stock vesting, the income for this job goes from high to something I could replace fairly easily within a year. I am still unclear if I received a reduction in pay this year (or any sort of cost of living raise) as such changes were supposed to take effect this pay period and I didn’t see a change in my base pay. Since I’m on maternity leave, it’s possible the change doesn’t go into effect until after I return either way (no one has told me if there will be any changes to my pay yet, so it would be strange for them to change it either way without notifying me — however, last year even when I was placed on a PIP I got a small cost of living raise — so not even getting that is pretty telling… I need to start packing my bags.)

While I’m tempted to pack my bags today and never look back (I’ve had a few recruiter calls that are promising, but I’ve opted to not take them any further.) I’m either going to stay in my field and be really strategic and picky in my job search OR I’m going to change careers (same industry, different department.) The career change, based on some preliminary research, will be a major income cut, no matter how you slice it. I’m torn on this because on one hand, my heart is in that field and I think I might actually be excited to go to work when I wake up in the morning.) But this field — it sounds like — will pay entry-level around 70k-125k. While 70k is a non starter, if I could make 125k… I don’t know… it might be worth it for a year or two as I build up my experience in the field. The bigger issue is the ceiling of income in that field seems lower than where I am now. But I’m not exactly thriving where I am now. So there’s the value of perhaps being in a job where I’m not worried about getting fired all the time (and then getting fired all the time.) Trade offs.

In order to determine when I should leave my current job (and for how much $ I should consider leaving for if I’m staying in my current field) I’ve calculated my estimated income for the next 12 month period at 5 different times throughout the year.  This showcases both how ridiculously strong my earning power is at the moment and how quickly it goes down to still-good but “recoupable” l levels if I were to move to a new company. The challenge are retaining employment through the high income earning periods and then find a job to replace it that provides high income earning potential (a new sizable stock grant) or make the leap to the new field and take the massive paycut and trust it will work out (if anyone will even hire me for that field… I’m starting an online certificate program in it and will see how that goes.)

Income potential 12 month period starting following dates:

At current stock value:

  • April 1: $702k
  • July 1: $599k
  • Oct 1: $425k
  • Jan 1: $299k
  • April 1: $251k

At optimistic (highest analyst estimate) stock value:

  • April 1: $937k
  • July 1: $759k
  • Oct 1: $511k
  • Jan 1: $345k
  • April 1: $287k

At pessimistic (lowest analyst estimate) stock value:

  • April 1: $428k
  • July 1: $411k
  • Oct 1: $325k
  • Jan 1: $246k
  • April 1: $208k

The above tells me I would be a fool to leave prior to Jan 1 in all but the absolute worst company performance scenarios (and even then it’s unlikely I’ll replace my potential 12 month income prior to that date.) I think the actual income will be closer to the current stock value as it’s unlikely it will go up fast enough to hit the analyst target within my actual earning period, but I also think it won’t drop all the way down to the lowest analyst estimates.

But the absolute best my 12-month income will be worth as of April 1, 2022 (assuming I am not getting any stock refreshes or raises, which I assume to be true) is ~$287,000. Which is still a very good income(!) but it is definitely in a range where at least looking for a new role makes sense. It’s an extremely high 12 month income for the role I’m in now at work (after my demotion) so I’m not complaining about it by any means, it’s just completely unrealistic to think I will ever be able to replace my previous income in this very limited role that is unfortunately not respected in my industry. I’m lucky in that my company likely won’t go out of their way right now to reduce my pay after I just had a baby — but they also won’t ever go out of their way to increase my pay. My days are numbered at worst and my income potential has a sharp ceiling at best. The absolute most I can earn in 2023 would be $248k (no raises or refreshes) and in 2024, it would be $213k — whereas if I go into a new role in a public company I’ll get a new larger grant that can possibly increase in value. My company is doing a favor by not giving me any raises or refreshes at this point… it helps the math tell me what to do.

That said, this year has a lot of good 12-month earning periods. My expected quarterly income is as follows for the next 5 quarters:

  • Q2 – $191k ( 103k-265k)
  • Q3 – $219k ( 131k-293k)
  • Q4 – $191k ( 103k-265k)
  • Q1 – $101k ( 88k-113k)
  • Q2 – $51.4k ( 38k-62k)

This also helps me figure out if I can potentially obtain a signing bonus to make up for any lost income, where it would make sense to move to a new role.

The above also shows that if I can move into a new field, it may not look like such a horrible comparison if I base this off next year’s Q2 income (as it will take me another year to have the potential to earn a bonus anyway and my stock is not increasing.)

The big question is — how do I stay employed for the rest of the year? I’m going to try to focus on taking it one quarter at a time, and celebrating earning the quarterly income. I have to remind myself that my husband earns $100k a year and I very well may earn $200k in 3 months if I can manage to retain employment for those 3 months. Even if I were to get fired at that point, I will have made over  $450k this year, give or take, as of July 1. This alone should support my leaving my company and taking 6 months to gain experience in a. new field and figure out my life. But then the tradeoff would be losing out on another $300k or so, which also seems like a really dumb thing to do. At what point in the future of time will I ever have the opportunity to earn this much in such as short period of time?

I just assume my new boss is earning less than I am overall, and that’s not going to set anyone up for success here. He may be earning more but it’s unlikely given he came in at a later date. He may have gotten substantial stock refreshes since he’s a company star but even then I bet we’re around a similar income this year. Maybe he will realize my income will be dropping substantially soon and won’t hold that against me, but he may just look at everything I do in the lens of what I’m earning now (due to stock appreciation) and in that case I would agree I’m not worth what I’m earning.

…I don’t know how the company looks at that because it’s not my fault the stock has appreciated so much… but on my annual performance review they note my expected annual compensation and that’s based on the stock value at the end of last year. That’s a big number (even bigger than what it actually is now because all tech stocks dropped a lot since then.) In any case, I just want to get myself out of all of this and get a job where I can add value. Which means I should probably change fields. It’s tough when recruiters are calling me left and right for senior-level roles in my field, all that pay in the $250k range (and maybe I could negotiate more.) Do I really set myself back years and take a job that pays $100k-$125k to try something new at 38? And why does my husband get to earn $100k yet I can’t do this… even if it will make me happy? I guess he doesn’t believe anything can make me happy… and that might be true. But I have high hopes for this new field. I think it will at least work the right part of my brain vs the one that makes me constantly frustrated and unsure how to do good work. Hmph.

Career

Holy Hell 2020: $850k Total Income (Can We Hit $1M Next Year?)

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Ok, let me catch my breath here. Because. What? I just added up all our income for the past year and if my calculations are right (they are) we made $850k in ONE YEAR in actual income (not counting investment gains.) This figure makes me kind of numb. You would think I’d feel rich (because when you make $850k you are rich even if it’s temporary) yet… I’m blinking here and feeling like, wow, even if I never make this much again in one year, I’m shocked that I did this ever. 

  • Shocked because I’m a bipolar woman who can’t hold a job.
  • Shocked because I’m pregnant with my second kid and struggle to be a mom and a full time employee and I constantly feel like I’m going to be walked out the virtual door.
  • Shocked because a year ago my boss put me on a PIP and I was supposed to be fired in July, but I held on for dear life to make this year a reality.
  • Shocked because in Silicon Valley, it’s probably somewhat normal for 2 adults in a household to earn this much in a year ($750k of the $850k was my earnings, $100k was my husband.)
  • Shocked because I don’t deserve to make this much.
  • Shocked because many of my peers and superiors likely made 2-5x+ what I made, and are likely going to continue to do that.
  • Shocked because wealth makes no sense and while many people struggle and go hungry in this country, and I am trying to figure out my place in how to help people while also knowing that due to my mental health issues I need to save a bit more aggressively than the average person, as I could hit a wall and not be able to work at some point.

This income won’t be our income forever. 2021 could easily break this record if the stock market holds up, but in 2022 we’ll be back to about $300k (which is still crazy good compared to the average person, but not holy shit we earned almost $1M in a year good.)

For the record, this has been my income and net worth gains since 2005. Clearly this year is abnormal. (This doesn’t include my husband’s income/savings, which have remained largely flat. If I keep earning like this maybe he can actually quit his job and become a FT SAHD!)

Year Income Networth $ Growth % Growth
2005 $15k n/a n/a n/a
2006 $35k n/a n/a n/a
2007 $50k $24.9k n/a n/a
2008 $60k $15.8k -$9.1k -37%
2009 $60k $32.7k  $16.9k 206%
2010 $120k $88.6k $55.9k 270%
2011 $90k $145k $56.4k 64%
2012 $100k $200k $55k 38%
2013 $110k $253k $53k 26%
2014 $125k $299.5k $46.5k 18%
2015 $160k $342.4k $42.9k 14%
2016 $190k $416k $73.6k 22%
2017 $130k $551.3k $135.3k 32%
 2018  $300k  $625k  $73.7k  13.3%
 2019  $400k  $1.05M  $425k  99.83%
 2020  $750k $1.6M  $550k  52.8%
2021 $750k 2.1M Goal $500k Goal 31.25% Goal

I’m still. Blinking. At my google spreadsheet. It is insane. Absolutely insane how much one can make a year if you hit the RSU lotto. And PLENTY of senior Silicon Valley execs make this every year of their working lives. And are married to people who also make this much. What do they do with all that money? I mean, if I could consistently make this much for even 10, maybe just 5 years I’d be set. Forever.

That would be nice.

My taxes are a nightmare but that was expected. We went safe harbor last year knowing we’d owe a lot. I was running these numbers to figure out how much “a lot” is and it looks like we owe about $50k for 2020. That’s ok, I have that set aside. What I don’t have so neatly set aside is 2021’s first quarterly payment. It’s going to be messy because if we go safe harbor (which we probably should) we have to do 110% of this year’s taxes owed.  Welp, that’s going to be $57k…

Typically, some of that would come out of salary. Now, some of it will come out of my RSU vesting and bonus (if I get one) as that will be paid out while I’m on maternity leave. But my maternity leave pay is much lower than typical pay and no tax is automatically paid on it. I know, boo hoo rich people problems — but we need to be careful because if we don’t pay enough estimated taxes next year we’ll have a huge penalty. The year after will be fine with my income dropping substantially. Next year is… well, basically in April we owe $100k in taxes. Hopefully no additional penalties there… I think we should be ok, as our CPA said we were doing fine on safe harbor as long as we paid 110% of last year (and we did automatically, since my total income went up so much.) But next year… it’s going to be rough if I lose my job at any point as we will be forced to massively overpay early on.

Again, rich people problems. Am I a rich person? Eh, I don’t feel like one. I guess I am? I did just buy a $1000 Roomba and a $35k bathroom remodel. But I still feel like I can’t afford a good kitchen table (we’ve never owned a good kitchen table.) So there’s that.

Next year–my wish is to break $1M income. It will be close. I’m going to have fun building a donor-advised trust as well. It might be wise to do that this year also, but I think I’m going to wait as I don’t have much of a mortgage deduction yet and I’m kind of scared about the tax situation so I need as much cash on hand as possible for the time being (plus who knows what random costs will come up for this house.) By the end of next year I should have a better idea of just how much I can/should put into a donor advised fund.

I mean, if I have some horribly traumatic birth and end up disabled (or dead) things are going to change quite a bit. If I don’t… then it’s full-speed ahead to some serious wealth. People on this blog constantly ask why I stay in Silicon Valley. This is why. I want financial freedom. FAT Fire. This dream is being built here. It’s certainly not a sure thing. But it’s worth it, as I approach 40, to know that I’ll have hopefully a large chunk of my adult life when (earning and saving a lot of) money is no longer a concern. We could always pick up and retire elsewhere and live a life of luxury too, but we love it here, and I think there are still great things for me to accomplish with the right company/team. Businesses to build. Problems to solve. There are a lot of things I love about working in Silicon Valley. I don’t love the craziness behind how people change when they’re chasing their next vest date, or needing to white lie to a board to get that next round of funding. But I do love a lot of the energy here. The desire to always improve things. Never settle. I probably would get bored most anywhere else.

Career, Other

What Comes Next? Vesting and Career Investing

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It’s funny. I filled out my performance review this year and in tabulating all of my contributions since last January, including ones that arguably delivered (significant) quantifiable ROI, I feel jolted into a sense of satisfaction meets unease—pride paired perfectly with the PTSD of being constantly reminded by my boss that I am not a leader, that I’m bad at running meetings, and that people generally don’t like me.

The reality is we are both right. I have a long way to go to be able to take the quality of my work and have a presence to match. And maybe I made a bunch of poor strategic choices this past year, but it’s hard to say when the only objectives my boss set for me was to hit deadlines (I was doing ok at this until one big project slipped) and make people like me (well, I don’t think I made major inroads in becoming queen popular this year while holed up inside my bedroom working in my PJs—though non interaction seemed to solve for this over a chunk of the year when people probably forgot I existed until I put out some decent work.

My issue 100% is consistency—which in a creative role is a massive challenge for me. The end product is usually good but the path to get there never clear. When I’m off on my own doing creative work and/or managing an agency I can GSD effectively. But throw in the kitchen sink of stakeholders / opinions, especially in an environment where I’m told my opinion doesn’t actually hold the same weight as everyone else’s, and I can’t seem to move things forward as I should. If I was just a project manager, I could do it. But as project manager and creator I find myself so often stuck. I know better than to stay stuck, and if anything it is best to just push forward and put out something vs drown in the sea of trying to make everyone happy and making no one happy.

But to be fair to myself, I was also put in a hard to win situation. My boss wanted me to lead, but her idea of leadership is somewhat incompatible with the processes designed to be collaborative. She made comments on how I brought too many people into the process (probably true) and yet in the end this collaboration was actually one of the most positive feedback notes received during the review of what went well and what didn’t.

What didn’t go well is not knowing how to guide people to my strategic vision and instead trying to execute on “theirs,” however conflicting it all was. My boss was not involved much—she just wants the person in this specific role to lead and figure out what to do and get buy in, but she has little interest in participating in determine what any of that is. She wants someone who will list be excellent. Trusted. Smart. Influential. Charismatic. Assertive.

She, apparently, wants my coworker. I mean, to do this. She put him into my temporary role and moved me out of it without clear communication to either of us. As she was, it seems, prodding him to step up and lead and equipping him with a career path to taking over my role, she was quietly plotting to move me out of it. I’ll never know if I still have a job because I am pregnant or if the leadership team actually sees value in me and wants me to stay (perhaps a little of both) but I’ve been put into a role where success is even more unlikely given again I have no control over the work I’m doing, only put in a position where I’m expected to both drive projects forward and make everyone happy.

I’ll do my best.

What is most challenging right now is that I’m being tasked to come up with a strategic plan for next year, yet I can’t move forward with this until other planning I am not involved in is done, yet I go out on maternity leave in less than two months and there isn’t much time remaining to move forward on a plan let alone create a plan. I take one step forward and two or twenty back. If I don’t plan, I am told I am not making enough progress. When I try to move things forward, I’m told I’m moving too fast and I need to wait. Somehow, no matter what I do, my former boss (now boss’s boss) seems to find fault with it. Luckily I have a few projects to take me through mat leave, and I’m hopeful they won’t ask me to leave between now and then with so much that needs to be wrapped up. But upon my return from baby 2 this spring, I acknowledge my days are numbered. The question is how long can I produce good enough work assigned to me and never miss a deadline so their argument to throw me out becomes one of documenting every last word choice made in emails and meetings and not one of failed project delivery. That won’t save me forever, but it’s possible with the right focus I can make it to the end of next year. I really hope I can.

But I also realize that there is no where to to here but down. I’m seen as a mediocre performer at best, saved by occasional delivery of projects that make my team look good. I want a job where people respect me for my strategy and results, not random output that has no greater value. So maybe I can find that next. This job, despite its ups and downs, has truly been life changing for me. Financially, I will be walking away from a few years of stock appreciation mostly sold and now safely in my bank account and diversified across index funds (and a new house.) While I’m sure had I been an A+ player I’d have even greater wealth due to rates and large stock refreshers I did not get, it all works out in the end as there are no golden handcuffs after next year, and it’s much easier to seek out a new role with a comparable package since this company has made it clear they don’t care if I stay (and clearly prefer that I don’t.) But I also take with me a solid chunk of time at a respected company that is not a startup no one has heard of. And while my role may be shrinking into oblivion, my resume has grown enough to at least land me interviews (or I assume it would) vs what life looked like job hunting prior to this role. This is not to say I’ll easily get hired anywhere, but I do think I have a shot at being high on the list of who to call when I submit my applications.

The real question is — how do I make it through next year? The amount of money on the table is non trivial and losing any of it would feel like taking a winning lottery ticket and dropping it onto subway tracks with a train coming at full speed, instantaneously blowing it away as if it never existed. So. I have my personal marching orders. Survival. Survival in the hard months upon returning from maternity leave when sleep is practically non existent. If I am able to continue to WFH due to covid this may help—but it also may prove challenging as partially the return to an office last time enabled a mental split from mom life to work life, and my occasional naps in the breastfeeding room out of sheer exhaustion were not interrupted by a toddler screaming out the alphabet for the nine thousandth time in a row. So this will be interesting, to say the least. An interesting year of being good enough that they won’t fire me. Or at least that they will wait until performance reviews next year to do so, giving me a few months of safety upon my return to work. It’s all possible. I think I can deliver on what is expected as long as I do not over commit and I hide as much as possible. I say little, in meetings or otherwise. My only objective is driving positive sentiment about interactions with me. Everyone should say how easy I was to work with, how they felt heard in meetings, and how I helped them deliver on their vision. If I can do this, barring any major unexpected layoffs, I should be safe. Unless I’m already on the chopping block.

But I don’t think I am. It would be in poor taste (and with questionable legal standing) to fire me a few weeks out from maternity leave with the delivery of a number of successful projects in the recent past. It would be equally questionable for them, within 3-6 months of returning from maternity leave to fire a woman who is performing at least at moderate levels. I never try to contribute anything less than exceptional work, but the reality is after you have a baby (and I hear after you have a second one) sleep is non existent and it’s hard to perform at the same level for a little while, until baby starts to sleep through the night and isn’t waking you up to nurse every few hours.

So on one hand, I feel good about where I am. Two months out from maternity leave, if that, with a clear line of sight to half of the remaining vesting periods. I can’t (and wouldn’t) slack off at this point, but I it feels very possible to make it through that, in the least. Then, I have my 6-12 months of holding on for dear life. And figuring out what’s next. I’d love for my company to acknowledge my contributions and fight for me to stay, but that clearly isn’t going to happen. I’ll be lucky if I see any sort of raise this year (I received a <2% COL adjustment last year with a tiny stock refresh valued under 10k a year compared to my initial grant of 50k+ a year) so I’m clearly in the bucket of employees who are good enough to stay but not good enough to fight to keep.

Would I feel blissful if my company suddenly gave me a massive stock refresh this year as thanks for what I’ve contributed? Sure. That would be nice. It’s not happening. I probably am making more than my new boss right now with my total package, at least should I ever get a refresh bringing me back to where I started. It’s not happening. I don’t even have a title right now. They put someone into my role and moved me into a new role and didn’t have the respect to clarify what my new title is, or to even make it clear that my colleague is stepping into the role I was performing (outside of just organically allowing it to happen.) The whole situation is just unprofessional and unsettling, but who am I to complain when I’m looking at my stock vesting account and see the amount I may receive next year? I really can’t complain. I’m so grateful. And I want to stay and stay not just because HR is saying something about keeping me until legally I’m no longer protected, but because I actually am doing good work. If I am going to leave in early 2022, which is the plan, I want to leave on a very high note.

While it seems like a very long time between now and March 2022, it really isn’t. Especially not in returning to the first year of motherhood. It will feel long and yet also fly by in a blur. I need to have a plan for what’s next since I’m the breadwinner and carry the insurance. I can’t just take time off. I’ll have to be on the top of my game when kiddo #2 turns 1.

Every last ounce of me is determined to make it happen. I am not going to be a superstar or anything close to it, but I’m going to make it through to the day I receive all the stock offered when I joined. And I’m going to surprise no one when I put in my notice, but I’m going to do so after a long period of consistent, high-quality work and everyone feeling good about whatever it is I’ve done, so in the years to come people will remember the positive about my contributions and maybe forget about how socially awkward I am and horrible at communicating. I’ll say as little as possible and hope that gets me across the finish line.

Networth

New Goal: $1.3M Networth by 2022 (age 38)

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In 2008 or so, I had $29k in total net worth. Ten years later, my net worth closed out the year at $625k. Ten years ago I couldn’t fathom having more than $100k in a bank account. At age 24, I was just getting started in my career, making very little, and wondering how on earth to save money.

I started out ahead of many–a college degree with no loans. I’m not sure I’d be where I am today or even close to it if I had massive loans to pay back, because that would have not only cut into my savings, but also likely prevented me from taking some of the risks I’ve taken over the last 10 years that helped me save so aggressively. But, I do try to take a few moments to be grateful for what I have, and how much I’ve been able to save–despite not being able to afford the high cost of living in the Bay Area.

Today, I’m especially grateful that my current path has not only enabled me to hit my goal of saving $500,000 before giving birth to my first child, but also is looking to possibly support my second goal of saving $1M before my second–which was a long shot just years ago.

Screen Shot 2019-05-11 at 9.26.43 AM

The last few months have been especially fruitful, thanks to vesting stock–my first stock vesting period working for a public company–and selling it off immediately. I do not include any unvested stock in my networth calculations since if I lose my job that $ isn’t real. But it’s hard not to fantasize about it being real–even with it being not that much once taxes are taken out–it’s still a substantial amount and can be life-altering given my whole financial strategy is save as much as possible as fast as possible… not for FIRE, but for financial freedom (working PT, consulting, or pursing more risky opportunities, or those that don’t pay as well, in order to help others and/or just spend more time with my family.) And I won’t give up a decent lifestyle today to assume that I’ll have enough money for a frugal one “tomorrow” that doesn’t require working. I want to LIVE today but support a future where I’m not worried about money and can afford a decent lifestyle with a family.

I’m still uncertain what my “number” is. At last estimate it was about $4M-$6M, including a house worth about $1.8M. I still don’t think I’ll EVER get there, but as I set new financial goals for myself along the way, it helps to keep focused on these mini wins towards this major goal. Even if $4M is my “goal” that’s far off.

I had said I wanted to hit $1M by 40. Right now, I’ve sped up that goal to 38 (I’m 35 and a half now.) Within the next 3 years, I’d like to get to that $1M mark. A lot will depend on the volatile markets — if we have a crash, there is no way I’ll get there. If they stay stable or keep growing, there’s a good chance…

  • April net worth: $847k
  • Remaining 2019 stock value after tax: ~$92k
  • 2020 stock value after tax: ~$123k

With saving my stock amounts, and with the markets staying stable, it’s quite possible I’ll get to $1M even earlier… by 37… which actually is my goal since I want my second kid by 37 and I would like to get to $1M before I give birth. I won’t feel any richer for it, but I think with $1M in the bank I’ll start feeling ok about taking a few more risks when it comes to buying a house. Ideally I’d have $1M in the bank (investments) plus enough for downpayment and closing fees in cash. Perhaps I can get there in 3 years. That requires saving $500k in 3 years, or $150k per year.

  • 2019 (35): $92k (stock) + $25k (interest) + $35k (income savings) = $152k
  • 2020 (36): $123k (stock) + $25k (interest) + $35k (income savings) – $50k (IVF) = $123k
  • 2021 (37): $123k (stock) + $25k (interest) + $35k (income savings) – $20k (preschool) = $153k

Total end of 2021: $1.275M. Not quite $1.3M, but close. Close enough where at that point I’d be willing to put $300k down on a $1.5M house and have $1M in the bank as a safety net.

Past 2021, my savings will go down again… my stock will be vested and it’s unlikely I will find another job where I make anywhere near this much. If I can keep this job until the end of 2021, I just realized… I’ll be really close to my goal–my new goal– $1.3M by the end of 2021.

BUT – big but here – is that to do that, we need to stay living in our 800 square foot one bedroom apartment rental for the next 3 years/until I have my second child. Maybe that’s crazy–but it won’t be that bad. If it means in 3 years we can buy a house and feel financially stable (ish) then it’s worth it, right?

Investing

How to measure portfolio performance?

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I’ve been failing at creating a spreadsheet that accurately tracks my portfolio performance and compares this to the same investment in the stock market. I’m going to try this a slightly different way… via, not a spreadsheet (which should make it easy but doesn’t) and instead, in the form of a blog post. Let’s see if this works… Continue reading How to measure portfolio performance? →

Investing

A Look Back: Apple Investing

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Apple has been, by far, my largest investment. Here’s a look at how I’ve done so far:

Total invested (all time): $35,070
Total shares owned: 100.89
Average cost per share: $347.50

Sold in 2013: $22,086
Shares Sold: 53
Average cost per share sold: $416.71
Gain per share: $69.21 ($3668.13)

Sold in 2014: $12,640.80
Shares Sold: 25
Cost per share sold: $505.91
Gain per share: $158.41 ($3960.25)

Current invested: $13,100.38
Current # of AAPL shares: 25.72

Date Action Stock Shares Cost Per Share Invested
4/7/2009 BUY AAPL 2.1604 $115.72 $250.00
4/14/2009 BUY AAPL 0.8412 $118.87 $99.99
4/28/2009 BUY AAPL 1.1964 $125.38 $150.00
5/26/2009 BUY AAPL 0.7576 $129.36 $98.00
8/4/2009 BUY AAPL 0.6057 $165.11 $100.01
8/11/2009 BUY AAPL 0.6146 $162.72 $100.01
8/18/2009 BUY AAPL 0.6154 $162.49 $100.00
9/1/2009 BUY AAPL 0.5971 $167.47 $100.00
10/27/2009 BUY AAPL 0.6254 $199.86 $124.99
12/29/2009 BUY AAPL 0.2379 $210.2 $50.01
5/11/2010 BUY AAPL 0.1969 $254 $50.01
5/18/2010 BUY AAPL 0.1969 $253.92 $50.00
5/25/2010 BUY AAPL 0.2003 $239.64 $48.00
6/8/2010 BUY AAPL 0.2003 $249.61 $50.00
6/15/2010 BUY AAPL 0.1937 $258.09 $49.99
6/22/2010 BUY AAPL 0.5485 $273.48 $150.00
6/29/2010 BUY AAPL 0.5837 $256.99 $150.01
7/6/2010 BUY AAPL 0.5955 $251.9 $150.01
7/13/2010 BUY AAPL 4.024 $248.51 $1,000.00
7/20/2010 BUY AAPL 1.021 $244.85 $249.99
7/27/2010 BUY AAPL 1.9114 $261.59 $500.00
8/3/2010 BUY AAPL 1.9168 $260.85 $500.00
8/10/2010 BUY AAPL 1.935 $258.4 $500.00
8/31/2010 BUY AAPL 0.8231 $242.98 $200.00
9/7/2010 BUY AAPL 1.9297 $259.1 $499.99
9/14/2010 BUY AAPL 1.6786 $268.09 $450.02
9/21/2010 BUY AAPL 1.7677 $282.86 $500.01
9/28/2010 BUY AAPL 6.2267 $289.08 $1,800.01
10/5/2010 BUY AAPL 0.6975 $286.75 $200.01
10/12/2010 BUY AAPL 0.3367 $296.99 $100.00
10/19/2010 BUY AAPL 6.4255 $311.26 $2,000.00
10/26/2010 BUY AAPL 3.2347 $308.84 $999.00
11/2/2010 BUY AAPL 0.9724 $308.5 $299.99
11/9/2010 BUY AAPL 0.9352 $320.78 $299.99
11/23/2010 BUY AAPL 1.9379 $309.1 $599.00
12/7/2010 BUY AAPL 1.8648 $321.75 $600.00
12/14/2010 BUY AAPL 1.867 $321.38 $600.02
1/4/2011 BUY AAPL 3.0075 $332.5 $999.99
1/11/2011 BUY AAPL 8.7587 $342.52 $3,000.03
1/18/2011 BUY AAPL 0.8944 $335.44 $300.02
1/25/2011 BUY AAPL 0.8858 $338.66 $299.99
2/1/2011 BUY AAPL 0.8705 $344.62 $299.99
2/15/2011 BUY AAPL 0.8358 $358.92 $299.99
2/22/2011 BUY AAPL 0.8729 $343.69 $300.01
3/1/2011 BUY AAPL 1.4151 $353.33 $500.00
8/30/2011 BUY AAPL 0.2571 $388.89 $99.98
9/13/2011 BUY AAPL 0.7855 $381.94 $300.01
10/18/2011 BUY AAPL 0.4768 $419.42 $199.98
11/1/2011 BUY AAPL 0.1259 $397.21 $50.01
12/20/2011 BUY AAPL 3.8201 $392.66 $1,500.00
12/27/2011 BUY AAPL 2.4613 $406.28 $999.98
1/25/2012 BUY AAPL 2 $449.72 $899.44
2/14/2012 BUY AAPL 0.9933 $503.36 $499.99
2/16/2012 BUY AAPL 3 $491.31 $1,473.93
2/16/2012 BUY AAPL 4 $491.31 $1,965.24
2/21/2012 BUY AAPL 0.9773 $511.6 $499.99
3/6/2012 BUY AAPL 3.0447 $525.51 $1,600.02
4/23/2012 BUY AAPL 1 $570.8 $570.80
5/8/2012 BUY AAPL 2.668 $562.22 $1,500.00
5/22/2012 BUY AAPL 0.8672 $567.36 $492.01
6/5/2012 BUY AAPL 1.1521 $564.17 $649.98
10/23/2012 BUY AAPL 2.3947 $626.38 $1,499.99
11/6/2012 BUY AAPL 0.8543 $585.29 $500.01
6/5/2013 SELL AAPL -10 $445.65 -$4,456.50
7/2/2013 SELL AAPL -43 $410 -$17,630.00
Investing

5 Years of Trading: The Sell Story

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One of my informal new years resolutions was to get a grasp on my stock trading in 2014. To start, I wanted to balance my portfolio so it’s less risky and more focused on dividends (thanks to some insight from a reader, I made some significant moves in January I’ll be posting about later.)

This post, however, is about how much money I’ve missed out on in hindsight with poor trading choices. I’m looking only at my taxable Sharebuilder account at the moment. Since 2008, according to my Sharebuilder account history, I’ve made 372 trades.

21 of those were sell orders.

Continue reading 5 Years of Trading: The Sell Story →

Career, Networth

My (Potentially) $20,000 Mistake

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It’s been said a prudent investor should limit the value of one stock to a maximum of 10% of their total portfolio. Usually it’s advised that one is even more diversified, especially if that stock is a small cap. I haven’t found advice about private companies because at that point wealth managers are generally advising angel investors with over $1 Million in networth to their name already. It’s really hard to find good advice for startup employees trying to figure out what to do with ISOs (incentive stock options.)

ISOs are a type of employee stock option that can be granted only to employees and confer a “US tax benefit.” They are also called Qualified Stock Options by the IRS. Tax benefits provided by the IRS are typically designed to encourage regular folk like myself to take minor risks in order to obtain higher value down the line. For example, the IRS allows the average joe to put pre-tax money (up to $17,500 a year) into his 401k, which, theoretically, is taxed at a lower rate during retirement.

For ISOs, the benefit can be huge if and only if the employee takes the risk to exercise early via an 83(b) election and the company does extremely well. The problem is that the risk that the employee is required to take is much, much larger than that of someone investing in a 401k. When you invest in a 401k for $17,500 per year you usually have an array of mutual funds that you can select so you have a diversified investment. If one company goes under, your investment will take a hit, but you won’t be down to $0.

Now, with ISOs, it’s a different story. If you join a company as an early employee you’re often sold the dream of the company hitting it out of the park, and those stock options being worth much more than they’re worth today. That’s how startups entice talented folks to leave big corporations to work for less money and much longer hours. Sure, there’s the flexibility, the excitement of building something new, et al, but if stock options weren’t a key part of that recruitment package they wouldn’t exist in the first place.

Some people do strike it rich on options. But the matter of fact is, 9 out of 10 startups fail. It isn’t clear how many of those 9 startups go to $0 and how many of those 1 in 10 actually return anything significant to common shareholders (i.e., the employees.)  I know for a fact that a certain $1 billion acquisition returned around $1 per share to common shareholders, while an acquisition of just a few million over what was raised returned $3 a share to common shareholders. The numbers never make clear sense.

With ISOs, you’re provided the benefit of early exercising. I’ve written a bit about this before, but basically, early exercising means you “get” (benefit) to BUY your shares right away. Why would you want to do this? Well, say you have the option to buy 10 shares for 1 penny each today, even though you don’t actually own any of them until one year down the line because you have 4-year vesting with a one year cliff, standard terms for founders and early employees. This means that whether you buy your options or not, you don’t actually have the right to any of them until one year of service. If you quit before that time, so long options.

But it gets more complicated. After the one year of service, every month you vest a percentage of those options, until year four. The company may or may not be sold or go public during this time. Companies, even successful ones, usually take much longer to go anywhere. Many of them have ups and downs and ups and downs on the way. The ups are great. The downs sometimes include investors coming in to give more money to keep the company afloat while washing away any potential gains of common shareholders. That’s one reason why successful companies may still not even provide expected returns to employees who have worked long and hard for their reward.

So why exercise early? Exercising is actually a taxable exercise. Companies gain value, albeit paper value, as they grow. So if you received 10 options for 1 cents a share in 2013, you can buy them in 2013 for 10 cents a share and pay no tax on these options. Say in 2015 your company is supposedly worth $1 per share. If you want to exercise them at that point, you have to pay tax on 99 cent gain per share. That’s not much. But if you own hundreds of thousands of shares, and the difference between the exercise price and the current value is much greater, you’re looking at a sizable tax bill for assets that are entirely illiquid and may be for the foreseeable future. Long story short, if you want to get any of the potential value out of your stock options, you probably should exercise early if your company lets you. Exercise early and pray.

Now, you’re thinking, why not just wait until a long time in the future when the company sells to exercise my options vs taking the risk today? You can certainly do that. The only problem – and it’s a biggie – is that makes you stuck if you want to leave the company or if you are forced out. You have 3 months (count ’em, 90 days) to exercise your options, or you give them up. At that point, even though the company may be doing well, you are looking at a taxable event if you want any of those options you negotiated so hard for and earned during your tenure at the company. You’re stuck with a psychological battle here — do you buy the options, pay tax on them, because they were part of your compensation package, accepting that they very well will be worth nothing after you’ve paid a heap of tax on them – or do you let them go and accept that one day they might be worth a lot and you won’t see a penny of it?

Yes, that’s the problem with ISOs. Worse yet, when you join a company early on, you don’t have to exercise your options, but when you’re a small team — unless it’s clear you just cannot afford to exercise those options today — people you work with like to see your skin in the game. If you’ve exercised your options, you’re an investor in the company. Yes, your fancy benefit for working for a startup is that you get to pay to invest in a company that has a 90% chance of failing.

The later you join a startup, the chances of failing might go down ever-so slightly, but the cost to exercise the options go up. No matter what, it’s a crapshoot. Like in Las Vegas where the Casino always wins, in startups, the investors always win, even if they lose. Founders have a slightly higher chance of walking away with a piece of the pie, even in a failed outcome, because they have so many shares the investors often want to buy them back from the founder so they can control the company. Founder gets a few million for selling their shares back, leaves on his merry way. Early employees are pretty much fucked.

That’s just the way it is. Few people understand this, or the odds. I joined an early-stage startup and paid $20,000 to exercise my options. Yes, this was a huge risk. Our CEO would rattle off numbers of our shares one day being worth something between $35 and $65 a share in company meetings. He got us all excited because that was his job and at the time we all had to be a bit delusional to grow the company from nothing to something. But I fell for it. I wanted to. I wanted to buy the startup lottery ticket and, while I knew the $65 per share was a long shot, I dreamed of walking away with enough for a down payment on a house. Couldn’t my 100,000 shares turn into $200,000? The fantasy was always $1M, but I kept myself grounded in reality, worked hard, hoped that maybe all my hard work would result in $2 per share. Just $2 per share.

Today, everything has changed. We have a new leadership. There’s no CEO standing up and talking about employee share price anymore. I’m pretty sure that’s one conversation the executive team wants to avoid. And I’m just an early employee who put 10% of her networth into one very early-stage company. If someone came along and asked me to invest $20,000 into a Series A startup today, and if I was legally allowed to, I don’t think I would because the risk is too high.

Angel investors (and VCs for that matter) would never invest in just one risky company and call it a day. For more seasoned executives, buying a chunk of a small company to exercise their stock options may be a much smaller percentage of their portfolio, so that’s a different story and a different risk allocation – what’s 10% of my portfolio could easily be 2% of an executive’s portfolio who has a lot more money and assets saved up.

That said, I encourage everyone thinking of exercising their options to be realistic about the risk involved. It’s not like buying an expensive lottery ticket exactly, or putting it all on roulette red, but there are risks involved, and yes, you can and very well may lose all or some of your investment. Venture Capitalists do not care about employees or their cute little stock. They care about not losing money and making money. If you’re working for a company that is going to raise a lot of money and wants to grow fast (once you take any VC money this is kind of a given) your stock is most likely going to be worth very little to worthless. Unless you happen to hit the jackpot.