Alrighty guys, I’ve been here with a similar scenario before, but I have since received the offer and accepted.

My employer, owner/manager of a private equity firm specializing in real estate development, offered me 1% of the fund I work for, exercisable in 5yrs (May 1st, 2029), valued currently at just over $250k. This offer included this current value to be the purchase price for if chosen to exercise. Additional details include that any distributions to members would reduce that value that is locked in for my purchase price, thus reducing the exercise price. Along with this, as normal, if the value increases, my purchase price remains the same. The owner set this up in a way that he wishes for me to exercise this option, stating that he’d finance the purchase himself come that time.

The company has increased in value by $32m since inception in 2012, averaging $3.2m in growth over the last 4 years, and paying out $6m in dividends since inception.

The trade off here is that my salary will not increase as quickly as it otherwise would. My question is whether or not this is a good deal. There’s potential for more % as I progress, as well. I’m 24, live in AL, work in a semi-rural community. Should I take this deal or take a salary increase of potentially $25k over the same 5 years. Furthermore, since electing this route, how should I prepare for this leading up to time?

Supplemental info, I make above average pay for my age and area. I also work some side gigs in accounting that average around $10k-$15k/year and then own rental properties, netting me an additional $5k-$7k per year, then average around $10k/year from options trading. Leaving me roughly $90k of income after factoring in taxes. I’m currently single, looking to marry soon, I rent, and have $25k of student debt.