nike employee benefits

Which Nike Employee Benefits Should I Prioritize?


As a Nike employee, you’re not just part of a company; you’re part of a community that values its team members. Beyond the iconic logo and the latest kicks, Nike offers a range of employee benefits designed to enhance your work-life balance and financial well-being. So, which Nike employee benefits should you prioritize?

Nike 401(k)

We believe the number one benefit to prioritize is the Nike 401(k). Nike generously matches 5% of your annual salary, essentially providing you with free money. If you want to get the maximum benefit, contribute at least 5% of your salary.

In 2024, the maximum 401(k) contribution is
– $23,000 if you under age 50
– $30,500 if you are age 50 or older

If you earn $130,000 and contribute up to the 5% match, you would earn $6,500 in free money. Don’t miss out on that money! 

Should Nike employees contribute to a Roth 401(k) or a traditional pre-tax 401(k)?

If you want to reduce your annual taxable income now, you may want to contribute to a traditional pre-tax 401(k). Your contributions will grow tax-deferred until you withdraw them in retirement. We generally recommend a traditional pre-tax 401(k) for high-income earners.

However, if you want to pay taxes on your annual income now, you may want to contribute to a Roth 401(k). This money, including the interest earned, will grow tax-free. You will never have to worry about paying taxes on that money again.  This gives you more control over your future taxable income.

Nike Mega Backdoor Roth

The Mega Backdoor Roth is a unique and valuable benefit that not many employers offer. This provision within your 401(k) allows you to contribute after-tax dollars to your 401(k) and then automatically convert those dollars to a Roth. You can contribute an additional 3% of your income (including your base salary and Profit Sharing Plan bonus), up to $10,350 in 2024, in after-tax savings.

How do I execute the Mega Backdoor Roth option?

First, you typically contribute the maximum in your Nike 401(k) Plan. Once you have done that, you can then contribute an additional 3% of your income, up to $10,350. You’ll need to request an in-plan Roth conversion of these funds, which you can do by calling the Nike 401(k) phone line. It’s important to execute this conversion as quickly as possible. In the event the funds increase between contribution and conversion, the growth will be taxable.

For example, our Nike employee is under 50 and earns a base salary of $230,000. They already max out their 401(k).
– 401(k) contribution: $23,000
– Nike 401(k) match: $11,500
Total 401(k) contribution: $34,500.

Using the Mega Backdoor Roth, the Nike employee can contribute an additional $6,900 in after-tax dollars and then convert those dollars to Roth. 

If you have already contributed the maximum amount to your Nike 401(k), then we believe this is the next best benefit to focus on. This is a fantastic way to increase your retirement savings.

How much should I contribute to the Mega Backdoor Roth?

How much you want to contribute is up to you. If you have already contributed the max to your 401(k) and contributed to your other large saving goals, then this may be the next best strategic move for you. However, it depends on your situation so it’s best to consult your financial advisor. 


Nike Employee Stock Purchase Plan (ESPP)

The Nike Employee Stock Purchase Plan (ESPP) allows you to purchase Nike stock at a 15% discount. Your ESPP contributions come from payroll deductions and are taken out on an after-tax basis. Each calendar year, you can use up to 10% of your eligible pay to purchase the lesser of $25,000 or 500 shares of Nike stock.

There are two offering periods each year:
– April 1 to September 30
– October 1 to March 31.

The first day of each period is the offering date and the last day is the purchase price.

If you sell your Nike stock within a year, the discount you receive plus the gain in value is taxed as ordinary income. If you hold the stock longer than a year, the discount is taxed as ordinary income, while stock returns are treated as long-term capital gains.

Should I participate in the Nike Employee Stock Purchase Plan?

It depends on your situation. For most employees, it makes sense to take advantage of the Nike stock discount. However, you should have a strategy in place so it’s best to contact a trusted financial advisor. 

Nike Equity Compensation

You can choose annually whether you want to receive your equity compensation in 100% NSOs, 100% RSUs, or a combination of 50/50 each. Your decision affects the number of shares awarded, with NSOs typically offering a higher count than RSUs.

Nike RSUs vs NSOs

Nike Restricted Stock Units (RSUs)Nike Non-Qualified Stock Options (NSOs)
ValueThe value of your RSUs is the price of Nike stock on the day your RSUs vest.The value of your NSOs depends upon when you exercise your stock options and when you choose to sell the stock.
TaxesYour RSUs are taxed as supplemental wages when they vest. They are taxed at a 22% rate for supplemental wages up to $1 million and a 37% rate for wages over $1 million.Your NSOs are taxed as ordinary income when you exercise them.
What happens if I leave Nike?You keep your RSUs even if you leave Nike.If you leave Nike, you have three months in which to exercise your vested stock options or you lose them.

Navigating equity compensation can be complex, but the potential benefits can significantly contribute to your long-term financial well-being. Engage in a conversation with your financial advisor to identify the optimal equity compensation strategy tailored to your unique circumstances. This will help you make a more informed decision that aligns with your financial goals. 

Nike Deferred Compensation Plan (DCP)

Deferred Compensation is available to employees who earn a base salary of $150,000. It’s an opportunity to save and invest dollars on a pre-tax basis meaning that you reduce your taxable income on a dollar-for-dollar basis. For example, if you defer $20,000 of your income, using DCP, you reduce your taxable income by $20,000.

Eligible Nike employees can defer:

  • Up to 75% of their salary
  • Up to 100% of their PSP Bonus for the following year. The bonus deferrals must be made at least 18 months before the payout.

If you’re eligible, you can enroll in the deferred compensation plan during Nike’s open enrollment window.

Nike Health Savings Account (HSA)

Nike offers its employees the option to enroll in a Health Savings Account (HSA). An HSA allows you to use pre-tax income for eligible medical expenses. To qualify, you’ll need to enroll in a High Deductible Health Plan (HDHP), which may come with a higher deductible but lower monthly premiums.  Your HDHP also needs to be HSA-eligible.

The HSA has three significant tax benefits:
– Contributions are tax-deductible
– Money grows tax-deferred
– You can withdraw money tax-free if the funds are used for qualified medical expenses.

Additionally, the funds also roll over from year to year and the money remains with you even if you leave Nike. The HSA program provides Nike employees with a valuable opportunity to maximize their retirement savings.

The 2024 combined contribution limit for an HSA is:
Individual: $4,150
Family: $8,300
If you’re 55 or older, you can contribute an additional $1,000

Does Nike pay bonuses?

Nike pays annual bonuses based on the company’s performance over the prior fiscal year. This is commonly known as The Performance Sharing Plan (PSP). Typically, qualified employees receive 5% – 30% of their annual salary as a lump sum.

Make the most of your Nike employee benefits in 2024

As you navigate your career at Nike, understanding and prioritizing these employee benefits can make your journey even more rewarding. From your health to your wealth, work-life harmony, and career development, Nike’s got you covered. 

If you want to make the most of your Nike employee benefits and are interested in a comprehensive financial plan, schedule a free discovery consultation today.

Best Financial Planner Washington DC

Alvin Carlos, CFP®, CFA is an investment advisor and fee-only financial planner, in Washington, D.C that works with clients across the country. He has a Master’s degree in International Relations from SAIS-Johns Hopkins. Alvin is a partner of District Capital, a financial planning firm designed to help professionals in their 30s and 40s achieve their financial goals through smart investing, reducing taxes, retirement planning, and maximizing their money. Schedule a free discovery call to learn how we can help elevate your finances.


District Capital is an independent, fee-only financial planning firm. We help professionals and entrepreneurs in their 30s and 40s elevate their finances and maximize their money. We are based in Washington, D.C and we work with people virtually nationwide.

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