Banking

Cash flow for equity holders is lumpy. A large RSU vest hits every quarter. An IPO or tender offer drops a six- or seven-figure lump into an account. An AMT bill from an ISO exercise takes a big chunk out the following April. Inside that lumpiness, the job of cash management is straightforward: keep the right amount liquid for known obligations, put the rest to work at sensible yield, and avoid the trap of keeping seven-figure balances in low-yield checking accounts because nobody set up the plumbing.

The tax-reserve account

The single highest-ROI banking decision for an RSU-heavy earner is having a dedicated high-yield savings account (HYSA) or money-market fund that holds the known-owed tax shortfall. At current short rates, HYSAs pay 4-5% on FDIC-insured balances. Holding $80k of Q4 estimated-tax reserve in a 4.5% HYSA earns about $3,600 a year over a checking account paying nothing. Marcus, Ally, Wealthfront, and direct Treasury access via TreasuryDirect or a brokerage are all reasonable choices; the difference between them is trivial compared to the difference between a HYSA and a checking account.

Treasury bill ladders for larger balances

For balances above the FDIC $250k per-institution limit — common after a liquidity event — short-term Treasury bills are the safer play. A 4-week / 8-week / 13-week T-bill ladder produces rolling liquidity at current federal rates without credit risk, and T-bill interest is exempt from state tax (useful for California, New York, and other high-tax-state residents). Brokerages handle T-bill ladders at near-zero friction through an auto-roll feature.

For IPO-year taxpayers, T-bill ladders are usually the right home for the cash earmarked for the April tax bill — higher yield than HYSA, state-tax-exempt, and the maturity can be aligned to the filing date.

When to borrow instead of sell

The HELOC vs SBLOC article in the mortgage section covers the decision to borrow against equity or real estate rather than selling concentrated stock. The short version: if you’re holding large unrealized gains on appreciated employer stock, and you need liquidity for a one-time event (a tax bill, a home purchase, a bridge to a liquidity event), SBLOCs can be cheaper than the capital-gains tax you’d pay to liquidate. The risk is a call on the line if your concentrated position drops — manageable if you keep the advance ratio well below the lender’s maintenance threshold.

Cash during tender offers

The specific case of pre-IPO tender offers deserves its own cash-management pattern. Tender proceeds hit your brokerage account; taxes are due in the quarter the sale closes; and the rest wants to be deployed into a diversified allocation. For most tech employees the tender-offer sequence is: tender → settle → immediately move tax reserve into a T-bill ladder → move the remainder into an ETF or direct-indexed portfolio. Leaving seven figures in a low-yield sweep account for six months is the most common mistake.

Credit cards, mortgages, and the broader banking stack

For high-income tech employees, the incremental value of points-optimization, premium cards, and private banking mostly doesn’t move the needle. The exception is post-liquidity-event clients, where private banking (Goldman, JPMorgan, Morgan Stanley) starts adding value through custom lending, currency handling, and concierge services. Before a liquidity event, a free Fidelity or Schwab brokerage does essentially everything a private bank does except offer white-glove service.

Next step

If you don’t have a dedicated tax-reserve HYSA, open one this week. If you have >$500k of cash sitting in checking or a sweep account, set up a T-bill ladder or move to a money-market fund in the same brokerage. If you’re post-liquidity-event with seven figures of uninvested cash, match with an advisor to structure the full deployment — the opportunity cost of a month’s delay on a seven-figure balance is usually several thousand dollars in yield.