You probably know your vesting schedule from memory. Four years. 25% after the first year. Quarterly after that. Or maybe it's monthly. Maybe your company does something different.
What most people don't know is what the structure actually means for their money, their taxes, and their decision-making. A vesting schedule isn't just a timeline — it's a financial event calendar that affects everything from your tax filing to whether quitting in March costs you more than quitting in April.
The Standard Four-year Structure
Most large US tech companies — Google, Amazon, Microsoft, Meta, Qualcomm — use a four-year vesting schedule. The typical design:
Year 1: 25% vests all at once on your one-year anniversary. This is the cliff. Years 2–4: The remaining 75% vests in equal installments — monthly at some companies, quarterly at others.
The cliff is the most financially significant feature of the schedule. If you leave before your one-year mark, you walk away with nothing from that grant. Nothing vested. The company keeps it all.
The day after your one-year mark, 25% is yours. The day before, zero. That gap is sometimes worth lakhs — even crores for senior employees. It's one of the most concrete financial incentives to stay through that first year.
📊 INFOGRAPHIC: "The Cliff and What Comes After" [Insert here: A timeline bar showing: - Month 0 to Month 12: Empty bar, labelled "Cliff period — nothing vests" - Month 12: Big jump labelled "25% vests (cliff)" - Month 13 onwards: Gradual fill labelled "Quarterly/monthly vesting" - Year 4 end: Full bar, "100% vested"]
Monthly vs Quarterly Vesting: the Difference in Practice
This sounds minor but it isn't.
If your company vests quarterly, you have four perquisite events per year. Each one is a taxable moment. Your employer sells a portion of your shares four times a year to cover TDS.
If your company vests monthly — Google does this, for instance — you have twelve perquisite events per year. Twelve separate entries in your brokerage statement. Twelve different FMV calculations at twelve different stock prices. Twelve different sell-to-cover transactions.
At filing time, your CA has to reconcile all of these against your Form 16. If you've been treating this as "it just happens automatically," you might be handing your CA an incomplete picture.
The other implication: monthly vesting creates twelve small chunks of shares, each with its own cost basis and its own 24-month LTCG clock. That matters a lot when you're deciding which shares to sell.
The Back-weighted Exception: Amazon
Amazon does it differently. Very differently.
Amazon's vesting schedule is famously back-weighted: 5% in year one, 15% in year two, 40% in year three, 40% in year four.
For someone joining Amazon with a ₹1 crore RSU grant, that's: Year 1: ₹5 lakh worth of shares Year 2: ₹15 lakh Year 3: ₹40 lakh Year 4: ₹40 lakh (depending on stock price)
Years one and two feel like you're barely getting anything. Year three is when it hits. The financial planning implications are significant — you can't treat your RSU income as evenly distributed if you're at Amazon, and the advance tax obligations in year three can be a serious surprise if you haven't planned for them.
Refresher Grants: the Compounding Effect
Here's the part that catches most people off guard, usually around year three.
After your initial grant starts vesting, most large tech companies issue additional RSU grants — called refreshers — typically tied to your annual performance review. These new grants have their own four-year vesting schedules, starting from when they were issued.
So by year three at a company, you might be vesting simultaneously from: - Your original new-hire grant (years 3–4) - A refresher from year two (years 1–2 of that grant) - A refresher from year three (just started)
Your quarterly RSU income is now a combination of all three. And your single-stock concentration keeps rebuilding, even as the original grant runs out.
This is why long-tenured tech employees often have significantly more concentrated RSU exposure than they expect. The more senior you get, the bigger the refreshers, the faster the concentration grows.
📊 TABLE: "How Overlapping Grants Stack Up — A Hypothetical Example" [Insert here: A 4-column table] Year | Grant A (Original) | Grant B (Year 2 Refresher) | Grant C (Year 3 Refresher) | Total Vesting Year 1 | 25% of A | — | — | A×0.25 Year 2 | 25% of A | 25% of B | — | A×0.25 + B×0.25 Year 3 | 25% of A | 25% of B | 25% of C | A×0.25 + B×0.25 + C×0.25 Year 4 | 25% of A | 25% of B | 25% of C | A×0.25 + B×0.25 + C×0.25 Year 5 | — | 25% of B | 25% of C | B×0.25 + C×0.25
Why This Belongs in Your Financial Calendar
Put every vest date in your calendar. Treat each one as a financial event that warrants a decision — not just a notification you acknowledge and move on from.
On or just before each vest date, three questions are worth asking: 1. How much is vesting, and what is the approximate tax I'll owe (already handled by sell-to-cover, but good to verify)? 2. Of the shares I'll receive, what's my plan — hold, sell, or a split? 3. Does this vest push my total RSU position to a concentration level I'm comfortable with?
Answering these three questions at every vest, consistently, is more valuable than any complex financial model.
How Rovia Can Help
If you're not sure which grants you're currently vesting from, what your effective quarterly RSU income looks like, or how your vesting schedule interacts with your tax obligations — that's exactly the kind of clarity Rovia can provide.
We'll map your full equity picture across all active grants, help you understand what's coming up, and build a plan that takes into account the shape of your schedule, not just the total number of shares.
Source: Amazon vesting schedule structure — widely reported in public comp benchmarking, confirmed via levels.fyi and company public disclosures.
