drafted out of hs?

No big deal either way.  Everybody has an opinion and point-of-view.  That's why Baskin Robbins has 31 flavors.

 

2016 Baseball Dad:  There's a lot of great advice for your friends to accept/ignore on this and other threads.  The bottom line is this:  It only takes one team to like the kid.  If he's drafted, then he'll have a decision to make (based on his commitment to a top D1).  Many others (including TPM's son) have already been thru the process and are giving advice based on their experiences, which is invaluable.  You will also note that there are as many different answers as there are posters.  We are going thru the same process right now (GHHS jr is a 2016 LHP also) and appreciate everybody's input.  It doesn't mean we always agree, but all knowledge is power.

 

Spend some time searching all the draft threads and recommend your friends to the same.  You won't find a better spot for answers.

You side tracked this topic, not me.  I stand by my original statement. If one drops out of college after their freshman year if they do not re enroll and sit idle for the next two years its not going to happen. Bickford did not remain idle, he had to attend JUCO for the next years draft to be eligible to be drafted. And he was an exceptional talent from the get go. 

 

My advice is not based on experience but the rules.

 

The first year player draft rules(Rule 4) for draft eligibility are as follows.

Never signed a major or minor league contract.

High school players who have graduated and not attended a 4 year college or junior college.

College players from a 4 year program who have completed at least 3 years or at least 21 years old and junior college players regardless of how many years they have attended.

 

Unless you can come up with something else, I don't see where I gave any wrong advice. Bickford could not have gone and played independent ball and been eligible for the next draft.  Neither could anyone else who left after one year of college.

 

And in my original statement I suggested that the parents of the player become familiar with the draft and even visit this site.

 

The mistake he made was not signing when first drafted out of HS as the 10th overall pick.  

 

 

 

Let's find a way people to share info/opinions without getting personal.

shouldnt be about getting last word or always being right. Remember, when texting u don't hear tone as u would in face to face communication. Something may sound harsh, but it's just way things are worded. 

http://sportsblogs.star-telegr...-mlb-draft-goes.html

 

Interesting article on money breakdown. Numbers are supplied by a college coach, so grain of salt to some degree, but knowing him it should be fairly accurate. Interesting read.

 

Shows "seven figures" ain't all it's cracked up to be.

I do a little personal investing advising on the side.  I have a guaranteed return on investment TWO STEP plan for anyone.  Here is my "big money" plan I offer to any athlete or anyone who comes into a lump sum of money:

 

Step 1:  Give me all your money

Step 2:  I give you half of it back in 10 years

 

My guarantee is you will have much more money with my plan in ten years than handling the money yourself.

Sorry Ironhorse, but that article has little to no actual value in that it addresses about 20% of the entire picture.  I could see a college coach throwing out these figures (which are probably accurate - just not useful in a vacuum) to persuade a player to go to college.  There are some folks on this site that will say college is the only real choice absent really big money (sounds like $1 million is a decent starting point) or essentially zero shot at actually succeeding at school - they are of the opinion that the college fund (which generally gets included based on my understanding) seldom actually gets used properly.  Getting back to my original sentence - the 20% refers specifically to the mathematical calculations.  Once you get the math down, the real work begins on whether or not a kid (assume 18yo but could be 17 or maybe 19) can cut it in MiLB based on the competition and the less than luxurious lifestyle - if you can truthfully answer this second part, the math will probably work itself out.

The math sounds about right to me... however 1 million would not do it for me... If 2018 was at a low D1 state school maybe so, but Vandy not even close....

 

Vandy education, the perks they have, the baseball is excellent, chance at College W/S, close to home and I feel they would make him a better faster rising pro guy after three years there and still get drafted....

 

Compared to clearing 500k for a 5 year contract , the low A living conditions... being in some small town no -brainer

I didn't mean to imply that $1 million would sway one from Vanderbilt, nor Stanford.  Maybe not Virginia, etc. and the list goes on.  I can see where the Vandy coach has a lot easier argument because of just what you mentioned - the other side of the equation.  That said, there may be some big time players that, while having the baseball skills for these schools, may not be very successful in the classroom.  In short, it is a very complex decision which can never be fully answered based on a single dollar figure (ignoring the $2 million levels for sake of discussion).

It's not a math problem.

 

It's a "what's important in your life" problem.

 

My view is that if you have the choice between being picked in a signing round and playing for an elite D1 program, money should not be the determining factor.

 

Unless you are 100% committed to going all-in on a pro baseball career right now and you whole-heartedly embrace the hardships and risks and opportunity costs that accompany that choice, then you should go to school. An extra $100k or so shouldn't make the difference.

 

 

No sure how it has no value when people are discussing what is or isn't "life altering money." It does a pretty good job of putting the money piece in perspective. 

 

What this article fails to account for, and it is a MAJOR over site, is the good old time value of money, compound interest and the power of starting to invest early in life dynamic.  Let's have a look:

 

* Let's assume that he is right on with his "short term" math and that a young man who gets a $1m signing bonus really only ends up with $469,000....Ohhh, to have $469,000 going to work in a diversified portfolio at the age of 20!!

* Basic investing, time value of money, diversification and portfolio theory (and the Rule of 72) suggests that in average markets one will double their money in anywhere from 8 to 12 years (12 assumes a conservative 6% IRR and 8 assumes 9%).

* So, assume for simplicity that this money goes to work at age 20 and that the player can somehow survive on wages or salary (within or outside of baseball) from age 20 to 60...basically, like most humans.

* Let's assume the middle of the road; that is, a mere 7.2% average annual return.This means the money doubles every 10 years (or 4x) and that at age 60, that paltry signing bonus (net of all the expenses) will have turned into a nest egg of about $7.5m.

* That is real money in my world...and "life altering".

 

What % of parents in the US (let alone the world) would not advise their kids to take a financial path in life where their expected outcome would be to have $7.5m + or - (note, it does not take aggressive investing to get 7% a year!) at the age of 60.  Yes, it takes some discipline (so what, find good advisors, put it in a trust, etc.) and potentially hard work (if baseball doesn't work out, he'd have to find another way to make a living).  But, very realistic and achievable.  A lot depends on how much one values education...or should I say academics...because education can be achieved in any number of ways in life, and there are families and players on both ends of that spectrum (and in between).

 

[I banged this out quickly at work; hope my math is right...I will go back and check..pretty sure it is].

 

Ironhorse - the article does a good job detailing how $1 million gets whittled down to $469k, but IMO fails to put the $469K into perspective.  For a kid getting a 75% ride to Vanderbilt, who has aspirations to be a MLB ball player and maybe a doctor if that doesn't work out, $469k means one thing. For some kid going to State U who really would prefer not to set foot in a classroom, $469k means something completely different.  The article has some value but is really only the very beginnings of the decision making process.  The $469k "left over" assumes a 7 year career.  Taking BucsFan's figures, that $469k would be somewhere closer to $1 million at the end of 7 years.  

That makes sense, but the fact that it is a good starting point on money gives it some value. We can definitely play the hypothetical game all day with investments and academic motivations, but the fact I know is this: every kid I've ever had that got drafted, there was always talk of a "number," from every angle, player, colleges, scouts, etc. It is one of the most important aspects of the decision. Setting that "number" for each individual kid is sliding scale based on a host of factors, no doubt. Most kids looking at getting a big number (think 5th round at worst) have already committed to a quality D1 program. They probably got for a healthy chunk paid for (50-90% has been the range for kids I've had experience with), so college fund isn't as big of an issue. Generally, the kids who aren't good enough students to pass basic classes have shown that in high school, and that impacts the decisions made by college coaches in a lot of cases, especially at the premier programs that also seem to be premier schools. So a lot of the variables of whether these kids can succeed in or afford school aren't as big an issue as the money offered to sign. Again, just my experience, and when we're talking $1 mil plus, we're talking top HS talent.

Another way to look at it...

 

Every player that receives a million $ signing bonus is automatically considered a MajorLeague  prospect by the club that signs him.  Someone who will be in the Big Leagues within 5 years or maybe less.  While there is no guarantee that this will actually happen, this player will have every opportunity to succeed.  Baring injury he has a very good chance to make a lot of money. Even with injury he might make it.  The surgery and rehab will be paid for.

 

The other choice is to attend a great college.  That also is very valuable, but there is no guarantee that the player will be successful as a player or a student at that college.  What if he is injured and requires surgery?  

 

Then there is the player, his family, and the situation.  I know of kids that would consider $50,000 life changing money.  Also know of kids where 2 million wouldn't make a big change.  

 

If a potential baseball career is important and the money is right for "you" I can see every reason to sign.  Within a couple years the picture will clear up.  I know many don't ever use the MLB college plan, but it is there if college is important to you.  If injured seriously and can no longer play, college is there for you.

 

Maybe the thing to consider that most is that 4 year period between age 18 and 21.  A lot happens in those years no matter what choice you make.  Some get married and have children.  Some are injured.  Some do well, some don't.

 

Lets take baseball completely out of the decision.  Your son has this choice, right out of HS...

 

He can attend college with a nice scholarship plan.  Lets say 75% scholarship. No doubt, that sounds attractive.  He won't have to worry about taxes.  He can get a valuable degree and hopefully become very wealthy in time.  Degree in hand what might he earn over the next 4 years out of college?.

 

Or someone offers him a million dollars up front, less taxes, and he will get a small amount of pay also, insurance will be covered, and at the end if he still wants to, his college will be paid for. Add the fact that during that time, he has a chance to advance into a job that he always dreamed of that might pay him multi millions.  If that doesn't happen, he has earned a million dollars plus small salary the very first year out of HS.

 

So at the end of 8-10 years, we have two people that took different paths. Both have a degree.  One earned money early, one has been earning money for a few years now

 

Those are the two choices, no baseball involved in either choice.  What would you do?

 

I understand it isn't quite as simple as making that decision.  But I think it makes things easier if you simply take baseball out of the mix.  Because the dream of playing baseball for a living is very strong.  It can have a big affect on decision making.

 

 

Great post, now you have me thinking

> On Dec 1, 2015, at 12:52 PM, HS Baseball Web <alerts@hoop.la> wrote:
>

I agree college is way too risky!

PG hits the nail on the head.  That is, the way you analyze it is much the same person to person, but the weight each person puts on the opposing factors will vary person to person.

 

When I talk to players about the draft, I give them the framework to help them organize their thinking, but in the end they have to decide for themselves what number it would take to have them bypass college.  It's going to differ for everyone.

 

I have to laugh at the post saying they would pass on $1 million.  Statistically, less than 10% of the U.S. population will have as much as $900,000 when they retire.  With a million dollar bonus, you can expect to net something like 620-650k after taxes, and if you can't live on that and still keep enough in a growth investment fund to make you a multimillionaire by the time you're reaching retirement age, you should hire the financial professionals you need to keep you on track.  There are very, very few undergraduate degrees that translate to that kind of money.

 

Besides, by the time the kid is 25, he'll very likely either be adding MLB money on top of that, or he'll have washed out and gone on to school anyway.  That can make a difference for the kid who gets into Vandy only because of baseball and who wouldn't pass muster with the admissions department otherwise, but for most players, it just creates a different college experience.  Maybe one that involves greater maturity even, i.e., less focused on beer and more focused on academics.

 

I know of one kid who passed up a very high bonus because (a) he was dead set on college and (b) his father was an orthopaedic surgeon so, you might say money was not a big concern in their family.  Very few of us have the luxury of that kind of decision making.  BTW in that one guy's case, he came out after 3 years and actually did far better in the bonus department.  That actually doesn't happen very often, but there have been cases where players gambled and won.

P.S.

 

The reality is, for most draftees the bonus money you're talking about (if indeed there is any for them) is more like $100,000 as opposed to $1,000,000.  For them, the scales tilt more and more towards the college option.  But again, remember that roughly 45% of the population never even attempts college, so for a lot of people, getting 100k is a nice start on adult life that they wouldn't have otherwise.

Love all the different perspectives and info in this thread. PGStaff's post recalls a conversation I had earlier this summer with a friend who was drafted out of HS - mid-teens round. He played a couple of years, wound up with a career ending shoulder injury and put himself through college.

 

A player in our state had just been drafted and opted to sign right away, turning down a huge scholarship to a D1 school. Signing bonus was around 700K. My friend has a son who will very likely be a draft prospect in a few years and has already committed to a D1. Knowing that 700K quickly gets reduced by taxes, I asked my friend, based on his own experience, would he let his son go in the draft for that amount of money or advise him to go to school for the education, develop as a player and try to raise his stock. I assumed that his answer would be the latter. His response was that he couldn't answer my question.

 

He said that the variables would include what the farm system was like for the MLB team and where they saw his son fitting in to their system. He added (as previously mentioned) that the players drafted in the top 5 rounds are given a lot of time to develop. He also said that just as a player can develop in college, he can also implode or get injured.

 

Finally, he said the best advice he got in that situation was "You can always go to college, but you can't always get drafted." He said from his perspective it would be really sad to turn down a good draft slot and be sitting in an office at 40 years-old working a job just for the salary and all the while daydreaming about "what if?".

 

That conversation had an impact on my thinking about the draft v. college because it made me realize that while the value of a signing bonus or the value of an education can be measured in dollars, the value of pursuing one's dream and passion can't be measured in the same way - even if it means ultimately ending earlier than hoped.

 

Wow guys! So glad I found this site! I have a 2019 LHP that I wandered on here just to see what recruiting guidance I could find.....not that I have any delusions that my kid will ever be staring down a $1 mil signing bonus, but being a CPA I had never thought about the true financial aspects discussed here. The college vs pro scenario has tons of factors to be evaluated....if I should be so lucky, at least I have 4 years to evaluate!lol

You've come to the right place.  We have ALL the answers.   Heck, sometimes we'll even tell you more than we actually know. (All kidding aside, it's a gold mine..enjoy...and use the Search button and go back in the archives).

Midlo dad, glad I could give you a laugh.... I will send you  a PM and maybe another laugh or two...

 

Sorry system would not let me send you a PM.

 

you make some good points , but you do realize that 18 and 19 years olds are not the savy investor that thay should be?  And  tht there is a risk to investing... So that 469k could be lost in the market.... the degree from Stanford, Vandy, Virginia cannot .

 

 

 

 

I have heard repeatedly that the team can make a huge difference coming out of high school.  Have not heard many details about how "good" teams do it differently, just that it seems less cut throat as well as providing some structure (simple things like clean safe, affordable housing) which goes a long way for an 18 yo on their own for the first time.

I would take a million, if I flame out there still is a lot of left to pay school. So basically first two round prospects should consider signing strongly IMO. Even with 3-4th round (400-800k) signing is probably not the worst idea.

 

past the 5th round college probably is a better option, since your chances to make the majors are small and 200-300 k before taxes don't get you that far.

 

however with the guy in the first post I doubt he gets drafted the first 5 rounds unless he improves his velo to 90.

The beauty of having Vandy as your backup is that the scouts fully appreciate a players options and often have a pretty good idea of what it will take (despite what a player may tell them).  A high school kid going in the 5th round can still get $1 million if they can use the Vandy card.  The kid with the State U card doesn't get quite as much.  My main point to everyone with 9th graders is - make sure they understand that better grades equals a higher signing bonus - most will never see a dime but any motivation for a 9th grader is better than no motivation at all.

That's where you as a parent help your player to make good decisions.  

Believe it or not, my husband is an RA, yet he encouraged son to use a financial advisor who works with athletes. Son is 30 and has to go to him for money with good solid reasons why he needs it. Son didn't sign for a million dollars, never made a ML roster but has had some good investments made for him. 

If anyone feels their players would blow their bonus, they are not ready to go to work.

 

PGs post is excellent. Things have changed, if your son is a phenom out of HS he will be playing on the ML field in a year or two, making 500k a year, however,  keep in mind that most of our players are not phenoms. And yes, the drafting team should be a consideration because there are differences.

 

As much as I believe in the importance of an education, I would never give advice to my 17, 18 year old to give up a million+. I would also make him live on his milb salary. Sounds cruel but he will thank you someday.

 JMO

Look in the mirror. Am I ready or not?

 

 During the Area Code Games I interviewed thousands of parents and players and scouts.

 The majority of prospects, Not Ready for the grind. I Look for body language. 

 

Bob

I do realize that few 18-19 year olds are savvy investors.  Heck, few of any age group are savvy investors.

 

That's why there are financial advisors.  And any young man handling a large sum of money should have one.

 

BTW if your advisor lost all your money in the stock market, you should call me, I'll be happy to sue on your behalf.  Because that should never happen.  (Do some research on the term "suitability" and see what you find.)

 

A lot of people got skittish when the Dow went from over 11,000 to something like 6,500 back in 2008.  But if you were able to just not panic and ride it out, the Dow is close to 18,000 today, i.e., it's up like 60% over the last 7 years.  If you'd gotten your signing bonus in 2008, you'd be doing very nicely right now.  Even more so if you had been fortunate enough (or smart and brave enough) to buy in at the bottom.

 

An 18-19 year old has a very long term perspective and can expect to do quite nicely with a sound plan and patience.

In 2008 I was watching my 401k tank, my father however was on cloud 9 ! He asked me if I had any money , which I did not, and he said too bad, everything is on sale now, buy all you can
One particular stock is now 4 times what he paid
> On Dec 2, 2015, at 8:32 AM, HS Baseball Web <alerts@hoop.la> wrote:
>