I started my career is software engineering in 2020. Over the years, here\u2019s what my base salary progression has looked like:<\/p>\n\n\n\n

Amazon<\/strong> (2020<\/em>): $112,000<\/p>\n\n\n\n

Microsoft<\/strong> (2021<\/em>): $123,000<\/p>\n\n\n\n

Google<\/strong> (2022<\/em>): $169,000<\/p>\n\n\n\n

I didn\u2019t major in math but those jumps seem a lot more than a 7% year-to-year salary bump. Here\u2019s a deeper breakdown on what people don\u2019t talk about between the three.<\/p>\n\n\n\n

The Three Compensation Categories<\/h1>\n\n\n\n

In most software engineering offer packages at big tech companies, the compensation packages follows the following structure<\/p>\n\n\n\n

Base Salary<\/h2>\n\n\n\n

The base salary is your yearly take home salary before taxes. Most companies offer just a base salary for your role. This is usually paid every two weeks, twice a month, or once a month.<\/p>\n\n\n\n

Sign-On Bonus<\/h2>\n\n\n\n

Sign-On bonuses are usually one-time payments to new hires for joining the company. Companies need that extra incentive to get you to switch over. This usually has a 1 year commitment and if you leave before 1 year you have to pay back either the full amount or a pro-rated amount.<\/p>\n\n\n\n

Equity<\/strong><\/h2>\n\n\n\n

Equity is a complicated topic and deserves an article on its own. A company will promise to give you a certain amount of company stock but when you get it depends on your offer. It\u2019s usually 25% every year for 4 years and eventually runs out.<\/p>\n\n\n\n

If a company gives you $100,000 and distributes 25% every year for 4 years, expect $25,000 worth of company stock in your stock brokerage on your 1 year work anniversary.<\/p>\n\n\n\n

Performance Bonus<\/h2>\n\n\n\n

The tech offer might include a performance bonus that is given to the employee once a year every year. It\u2019s always subjective and depends on your performance and the budget. I\u2019ve only ever seen it be between 0% and 20%.<\/p>\n\n\n\n

Now you know when engineers are sharing their total compensation, it generally includes:<\/p>\n\n\n\n

Base Salary + Sign-On + (Total Equity)\/4 + Average Performance Bonus<\/em><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

Introduction Imagine you\u2019re using your favorite MP3 player, like iTunes. You can use its interface to add new songs…<\/p>\n","protected":false},"author":1,"featured_media":69,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6,7],"tags":[],"class_list":["post-68","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-software-development","category-web-development"],"yoast_head":"\n