Total Compensation Calculator

What This Calculator Does

The Total Compensation Calculator helps you estimate your true earning potential by combining your base salary, bonuses, and equity awards such as RSUs or stock options. This user-centric tool provides a clear, SEO-friendly breakdown of your average annual compensation, first year total, and four-year total, making it easy to understand the full value of your job offer or current compensation package. Whether you are evaluating a new opportunity or reviewing existing benefits, this calculator simplifies complex calculations for informed financial decisions.

How to Use This Calculator

1. Enter your Base Salary: Input the annual base salary amount offered or received from your employer.
2. Include Bonuses: If you have a sign-on bonus, enter its value. Specify your annual bonus target as a percentage of your base salary, if applicable.
3. Select Equity Type: Choose whether your compensation package includes RSUs (Restricted Stock Units) or Stock Options (ISOs).
4. Input Equity Details:
   • If you receive RSUs, provide the number of RSUs, current stock price, and expected annual stock growth rate.
   • If you receive Stock Options, enter the number of stock options, strike price, current preferred stock price, and expected growth over four years.
5. Review Your Results: Instantly see your average annual compensation, total earnings in the first year, and cumulative total over four years.
6. Adjust Inputs as Needed: Modify any inputs to compare different scenarios and compensation structures for better decision-making.

Definitions of Key Terms

Base Salary

The fixed annual amount paid to an employee before bonuses or equity. This is the foundation of your cash compensation.

Sign-on Bonus

A one-time cash bonus provided when you start a new job. Paid in addition to your base salary.

Annual Bonus Target %

The percentage of your base salary that you can potentially earn as a bonus each year, typically based on individual or company performance.

Equity Type

The kind of stock-based compensation included in your package, such as RSUs (Restricted Stock Units) or Stock Options (ISOs).

Number of RSUs

The total number of Restricted Stock Units granted over your vesting schedule, usually four years.

Current Stock Price

The present market value of one share of the company's stock. Used to estimate the value of RSUs.

Expected Annual Stock Growth

The anticipated yearly increase in the company’s stock price, expressed as a percentage. Helps project future RSU value.

Number of Stock Options

The total number of stock options granted, typically vesting over several years. Each option gives the right to buy a share at the strike price.

Strike Price

The fixed price at which you can purchase company stock via your stock options.

Current Preferred Stock Price

The current fair market value of a share as determined by the most recent funding round or valuation.

Expected Growth Over 4 Years

The projected percentage increase in the company’s stock price over the four-year vesting period for stock options.

Average Annual Compensation

The mean yearly value of all compensation elements, including salary, bonuses, and equity, averaged over four years.

First Year Total

The total value of all compensation elements you will receive in the first year, including sign-on bonus, base salary, annual bonus, and first-year equity vesting.

Four Year Total

The sum of all compensation components over four years, providing a comprehensive view of your potential long-term earnings.

Calculation Methodology

Base Salary (annual) = entered value

Annual Bonus = Base Salary × (Annual Bonus Target % ÷ 100)

Sign-on Bonus = entered value (applies first year only)

If RSUs:
  Annual RSU Vest = Number of RSUs ÷ 4
  Year 1 RSU Value = Annual RSU Vest × Current Stock Price
  Year 2 RSU Value = Annual RSU Vest × (Current Stock Price × (1 + Expected Annual Stock Growth))
  Year 3 RSU Value = Annual RSU Vest × (Current Stock Price × (1 + Expected Annual Stock Growth)^2)
  Year 4 RSU Value = Annual RSU Vest × (Current Stock Price × (1 + Expected Annual Stock Growth)^3)
  Total RSU Value = sum of yearly RSU values

If Stock Options:
  Annual Options Vest = Number of Stock Options ÷ 4
  Year 4 Stock Price = Current Preferred Stock Price × (1 + (Expected Growth Over 4 Years ÷ 100))
  Option Gain per Share = max(Year 4 Stock Price - Strike Price, 0)
  Total Option Value = Number of Stock Options × Option Gain per Share

First Year Total = Base Salary + Annual Bonus + Sign-on Bonus + Year 1 Equity Value
Four Year Total = (Base Salary × 4) + (Annual Bonus × 4) + Total Equity Value + Sign-on Bonus
Average Annual Compensation = Four Year Total ÷ 4

The calculator uses your provided base salary and annual bonus target to estimate annual cash compensation. Equity calculations depend on the selected type: RSUs are valued annually using the expected stock growth, while options are valued based on potential gains at the end of four years. The sign-on bonus is included in the first year total only. All outputs are designed to offer a clear, SEO-friendly snapshot of your compensation over time.

Practical Scenarios

• Comparing Two Job Offers: Use the calculator to compare total compensation packages from two different employers, factoring in differences in base salary, sign-on bonuses, and varying equity types. This helps you make a data-driven decision about which offer provides more long-term value.
• Understanding Startup Equity: If you are considering a role at a startup, input the number of stock options, strike price, and projected company growth to estimate the potential value of your options versus a traditional salary-heavy offer.
• Evaluating Promotion Packages: When offered a promotion or internal transfer, use the tool to quickly see how higher base pay, increased bonuses, or additional RSUs could impact your average annual and four-year total compensation.
• Planning for Stock Price Growth: Adjust the expected annual stock growth or four-year growth rate to see how optimistic or conservative projections affect the value of your equity and overall earnings.

Advanced Tips & Best Practices

• Model Different Vesting Schedules: Although the calculator assumes standard four-year vesting, consider how different vesting timelines or cliffs might impact your annualized equity value.
• Incorporate Realistic Growth Scenarios: Use conservative, moderate, and aggressive stock growth estimates to understand the range of possible outcomes, helping you plan for both best- and worst-case scenarios.
• Account for Taxes: Total compensation shown is pre-tax. Consult a tax advisor to estimate your after-tax take-home, especially for equity components, which may have complex tax implications.
• Review Liquidity and Exit Potential: For private companies, remember that stock options and RSUs may not be easily converted to cash. Consider the likelihood and timeline of a liquidity event (IPO or acquisition) when evaluating equity offers.
• Regularly Update Inputs: Market conditions and company valuations change. Revisit and update calculator inputs periodically to ensure your compensation projections remain accurate and relevant.

Frequently Asked Questions (Optional)

Can I use this calculator for both public and private companies?

Yes, the calculator accommodates both public and private companies. For private companies, use the most recent preferred stock price or your latest 409A valuation for the stock price inputs.

How accurate are the equity value estimates?

All figures are based on your input assumptions about stock price and growth. Actual future values may vary due to market fluctuations, company performance, and liquidity events.

Does this calculator factor in taxes or vesting cliffs?

The calculator provides pre-tax estimates and assumes a standard four-year vesting schedule with annual vesting. For more detailed modeling, including tax implications or alternative vesting structures, consult a financial advisor.