(FORTUNE Magazine) – DEAR ANNIE: I've been offered a job at a startup, and stock options are part of the compensation package. At this point all I know is the number of options, which is 25,000. What else do I need to know in order to figure out what the things are worth or might be worth in the future? I'm a tech person with no financial background, and I don't want to admit to the people recruiting me that I don't understand this stuff. BABE IN THE WOODS

DEAR BABE: At least you know that you don't know enough yet (or as James Thurber once remarked, "It's better to know some of the questions than all of the answers"). Says David Gumpert, who co-founded NetMarquee, an online direct-marketing agency, and ran it for four years before selling it to Circle.com in late 1999: "All my employees got options, and I was always surprised at how few questions people asked. It's very common for employees to say, 'Well, a friend of mine got 50,000 options at some other company, so I want 50,000 too.' " That would make sense only if options at one company and options at another were not apples and oranges--or, as the unhappy case may be, apples and lemons. Telling the sweet from the bitter, particularly at the startup stage of a business, is such an imprecise science that even seasoned professional investors used to shy away from trying. Two suggestions: Go to www.betterthanmoneybook.com, where you can download a copy of Gumpert's thorough, down-to-earth new book, Better Than Money: Build Your Fortune Using Stock Options and Other Equity Incentives--In Up and Down Markets. It will answer questions you haven't even thought of. For a quicker read, check out www.salary.com, a terrifically informative Website on all matters related to pay. Under the SALARY ADVICE tab, go to FEATURED ADVICE for a seven-part analysis called "Understanding Your Options."

In the meantime, Gumpert and Bill Coleman, a longtime compensation expert who is a VP at Salary.com, have a few thoughts on how to put a value on your options. The first step is to try to put a realistic value on the whole company. Says Gumpert: "Has the company received any financing from venture capitalists or other private investors? If so, they'll have ascribed a value to it. Let's say they invested $1 million and got 25% of the equity. By their reckoning, it's a $4 million company." Even though the company is not public yet, a certain number of shares exist. Try to get that number too. "Besides your 25,000, how many other shares are there?" asks Coleman. You can arrive at a rough share price by dividing the putative value of the business by the number of shares. Don't feel too bad if your stake looks puny: "A CEO will often have 3% to 6% of a startup. A rank-and-file employee will own something like 0.25%."

What if the venture hasn't gotten outside financing yet--or the top dogs are unwilling to reveal that information--so you have no objective opinion on the company's worth? Gumpert suggests that you do what the pros do and apply a "projection discount factor" to the founders' estimates: "Entrepreneurs make all kinds of projections about future revenues, profits, and so on, and often they are pulling numbers out of the air. So a good discount factor is about 50%." If you whittle the bosses' projections by half and feel that, on that basis, your 25,000 options just aren't worth enough, you can try to negotiate for more.

Observes Gumpert, "You should get the salary part of your compensation nailed down first." Since a startup will probably pay you less than you could command at an established firm, your aim should be to see that your options make up the difference. With 25,000 options at, say, a $1 strike price--meaning it will cost you $1 to turn them into real shares once you are vested (and, alas, vesting and its discontents are a whole other subject)--you should accept a $25,000 salary shortfall only if you believe the company's shares are worth more than $1 apiece today, with the potential to grow more.

Bill Coleman at Salary.com advises you to look at companies similar to this one that have already gone public and figure out their market capitalization (number of shares outstanding times share price), which will give you at least a sketchy idea of where you may someday stand. "But don't start counting your money too soon," he says. "Options are designed as a long-term investment, not a short-term cash-out."

Given the markets' recent backflips, that's a good thing.

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