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adbono posted:

 There are good teams and good players in every college conference but MLB clearly sees the SEC as having the best players.  Here are the # of players just drafted in each of the Power 5 conferences :                                                      SEC : 99                                                                                                                               ACC : 75                                                                                                                              PAC 12 : 49                                                                                                                         BIG 12 : 47                                                                                                                          BIG 10 : 37                                                                                                                          To reinforce other posts about slot value, college seniors having no leverage, etc.......A college senior that I help coach went in the 7th round and signed for   20K.  Was agreed to before the pick was made.

 

 

This year for sure. 99 is an incredible number -- 7 per school on average. Last year the SEC and ACC tied with 75 players drafted apiece.

RJM posted:
roothog66 posted:

One note. I believe the tax situation has changed dramatically for guys in the seven figure range. 

It only changed 2.6%

True, but a 2.6% drop in the tax rate equals a 5.08% drop in the amount of tax paid. Given only the personal deduction, a player in the 2017 draft would have paid $338, 714.62 in federal income tax. A 2018 draftee would pay $321, 488.25. A $17,226 savings may only be a 5% reduction in tax paid, but, hell, a 18yo minor leaguer could stretch that into living money for a year if he had to. Of course none of this takes state taxes into consideration and that can differ drastically from case to case. Anyway, $17k can pay a lot of bills.

Note: none of this is to be taken as an endorsement of the recent "tax cuts" which I am politically against, but if I had a million dollars...maybe I wouldn't be?

roothog66 posted:

As to the thought that a million only becomes $500-600k after taxes...that's 8 and 1/2 years of income for the average American family...on the low end...before taxes.

but compared to the earning power of degree from say Vandy or UVA it is not much money at all...hence why it was stated that the value of money is a variable. 8.5 years go very fast and a kid who crapped out of baseball and is now digging ditches or is a small town lawyer obviously has limited his lifetime earning power tremendously.

I honestly don't know the average household income for a family but I don't think it is relative in terms of a country. the costs of goods varies by similar amounts to the wages in a local area. Supply and demand and all that kind of stuff....plus the demographics of sport come into play.

IMO a college Jr needs to take the money and run, he is mature enough to finish remaining degree if he chooses.

A HS kid who considers himself a student needs to bank 7 figures or damn close to it or he should go to school.

I am always in favor of everyone paying less taxes...it makes for the best minor league!

old_school posted:
roothog66 posted:

As to the thought that a million only becomes $500-600k after taxes...that's 8 and 1/2 years of income for the average American family...on the low end...before taxes.

but compared to the earning power of degree from say Vandy or UVA it is not much money at all...hence why it was stated that the value of money is a variable. 8.5 years go very fast and a kid who crapped out of baseball and is now digging ditches or is a small town lawyer obviously has limited his lifetime earning power tremendously.

I honestly don't know the average household income for a family but I don't think it is relative in terms of a country. the costs of goods varies by similar amounts to the wages in a local area. Supply and demand and all that kind of stuff....plus the demographics of sport come into play.

IMO a college Jr needs to take the money and run, he is mature enough to finish remaining degree if he chooses.

A HS kid who considers himself a student needs to bank 7 figures or damn close to it or he should go to school.

I am always in favor of everyone paying less taxes...it makes for the best minor league!

It is not my position that it's a bad idea to pass up the money, just pointing out that it's funny how cavalierly we treat a half million after taxes. Median family income in US is around $59K and the avg. is around $71K. 

FYI, Uncle Sam takes 25% off the top, not for the very small bonuses paid out. Most of the larger bonuses are paid out in 2 payments, one after the draft and another in March. So a million payout is 500k, less 12.5% regardless of what tax bracket you will fall in. Then there is the agents fee, a good guy will split his fee in two payments. And then there are your state taxes.  

The MLB scholarship fund isn't what most think it is. Whatever you have negotiated, gets reduced each time you move up a level for no less than 90 days.  And then, believe it or not, you pay taxes on that scholarship money, which earns no interest.

I have been to this rodeo, so lets say a milllion after taxes, etc. becomes 700k which is a nice chunk of change. But I wouldnt let my son who is headed off to a college world series contender spend his time in the lower levels of milb. Ever.

JMO

TPM posted:

FYI, Uncle Sam takes 25% off the top, not for the very small bonuses paid out. Most of the larger bonuses are paid out in 2 payments, one after the draft and another in March. So a million payout is 500k, less 12.5% regardless of what tax bracket you will fall in. Then there is the agents fee, a good guy will split his fee in two payments. And then there are your state taxes.  

The MLB scholarship fund isn't what most think it is. Whatever you have negotiated, gets reduced each time you move up a level for no less than 90 days.  And then, believe it or not, you pay taxes on that scholarship money, which earns no interest.

I have been to this rodeo, so lets say a milllion after taxes, etc. becomes 700k which is a nice chunk of change. But I wouldnt let my son who is headed off to a college world series contender spend his time in the lower levels of milb. Ever.

JMO

And note that the 25% "off the top" is not enough to cover the tax bill for those who don't do much to protect that money then they get hit with a big surprise the next April. Paid out in 2 payments at least makes it all taxable at a lower %. 

By the time a player pays the taxes on a million dollar bonus he’s lost 37 to 50% depending on the state. But still the last pick in the first round received 1.6 gross this year. That’s 800K to 1M net. Signing and taking the bonus doesn’t prevent to player from attending college later.

roothog66 posted:
TPM posted:

FYI, Uncle Sam takes 25% off the top, not for the very small bonuses paid out. Most of the larger bonuses are paid out in 2 payments, one after the draft and another in March. So a million payout is 500k, less 12.5% regardless of what tax bracket you will fall in. Then there is the agents fee, a good guy will split his fee in two payments. And then there are your state taxes.  

The MLB scholarship fund isn't what most think it is. Whatever you have negotiated, gets reduced each time you move up a level for no less than 90 days.  And then, believe it or not, you pay taxes on that scholarship money, which earns no interest.

I have been to this rodeo, so lets say a milllion after taxes, etc. becomes 700k which is a nice chunk of change. But I wouldnt let my son who is headed off to a college world series contender spend his time in the lower levels of milb. Ever.

JMO

And note that the 25% "off the top" is not enough to cover the tax bill for those who don't do much to protect that money then they get hit with a big surprise the next April. Paid out in 2 payments at least makes it all taxable at a lower %. 

Yes, who knows exactly what they will end up paying in taxes. I almost threw up when I saw what sons first check really was. We live in Florida so no state taxes. 

Then a lot of the kids go out and spend a lot on boy toys. They don't know how to save and their parents don't educate them on being responsible.

BTW, they don't split the payments to help the player out. Teams claim to be cash poor when first checks are drawn. You dont get drafted and paid right away. Ask if I feel badly for them. 

I don't.

 

 

its not just during the draft. i have friends that played in the minors and majors. teams will do somw shady things to avoid paying or cutting your length of service. thats another reason if you do not get great money, and you have a chance to get a vandy, stanford type degree you would be foolish to take a million. 600k after taxes, for 6 years...... and i hear the "go to school later" advice but thats not practical ....70 % of mlb players went to college

Get Outlook for Android<https://aka.ms/ghei36>

well according to Forbes 27% of MLB is foreign born, I feel comfortable speculating that the vast majority of them didn't go to college...so that leaves with what maybe 5% ish of players who didn't go to college?

life gets in the way, go to school, have fun, play hard, drink beer, chase girls, study well...Jeez I feel like Kenny Chesney could write a song about this.

I just wanted to make it clear that I wasn't taking any position on passing on draft $$$, just pointing out that it is easy for us to talk about $500K after taxes when it's hypothetical. It's a little more complicated in the real world. This decision is a very, very, circumstantial one in which several factors must be considered:

1) What school are you committed to?

    Stanford and Akron are not equal.

2) What is your family's financial situation?

   Again, Vandy from a family that can help support you for three years is not the same as coming from poverty with a 30% scholarship from Northern Colorado

3) Are you ready to play professional ball?

   Emotionally, this is a big step into the real world for an 18yo. Are you emotionally ready and mature enough to step into the brutal realities of low-level minor league ball that is a business? A world where the real competition isn't on the field, but rather is the guy sitting next to you in the bullpen? 

4) What are the chances you will improve your draft status in three years?

  This may be THE factor when talking money in the high-six-to-seven-figure range. If you're a big-time talent headed to a Power 5 school and don't feel like you've fully developed yet, this could be a big time, low risk gamble that could turn a million dollar bonus into 5 million if you're willing to wait.

My 2018 turned down money from two clubs wanting to draft (nowhere near the money we're talking about - NOWHERE near). However, if he entered pro ball now, as a young 18yo, he'd most likely be pigeon-hold into a reliever slot. He needs more work and development. What he doesn't need is years of bus travel and bad living conditions. However, he's not going to Vandy or Stanford, so, almost no matter how he develops in college, he's not coming out of it as a top half of the first round guy. For him, a third round slot would have been something with enough money that he wouldn't have gambled by passing it up. 

 

roothog66 posted:

 

2) What is your family's financial situation?

   Again, Vandy from a family that can help support you for three years is not the same as coming from poverty with a 30% scholarship from Northern Colorado 

I don't think most people realize how much of a difference this is between baseball and football. What is a  smart kid who has zero money for college going to do with a 75% offer from Vandy? Where is he going to get the other $15K per year to attend. He can  borrow the money, but that's really betting on yourself in a big way. Easy for us to say that a Vandy degree is well worth that investment in the long run, but much tougher for the guy who's trying to keep his scholarship, work toward a meaningful degree, and survive with very little money.

MidAtlanticDad posted:
roothog66 posted:

 

2) What is your family's financial situation?

   Again, Vandy from a family that can help support you for three years is not the same as coming from poverty with a 30% scholarship from Northern Colorado 

I don't think most people realize how much of a difference this is between baseball and football. What is a  smart kid who has zero money for college going to do with a 75% offer from Vandy? Where is he going to get the other $15K per year to attend. He can  borrow the money, but that's really betting on yourself in a big way. Easy for us to say that a Vandy degree is well worth that investment in the long run, but much tougher for the guy who's trying to keep his scholarship, work toward a meaningful degree, and survive with very little money.

A lot of factors. For Vandy or Stanford, for example, the need-based aid is SO generous that any low income kid with a 25% scholarship isn't going to need family money. Heck, even families with decent incomes will be covered. It's the HUGE advantage private schools and a few public schools with huge endowments have over the rest of the baseball recruiting world.

Everyone's situation is different.   2018 had a number and if a club hit that number , he would have gone and we would have supported him  with housing , vehicle, insurance, cell phone just like I did the other sons while they were in college.   

While he could have agreed to what some would feel was a steep number, and went to rookie ball,  you have to factor in many variables some of which have been listed in this post.  Frankly,  600k  is a lot of money to me....  but when you compare it to the scholarship dollars he is receiving at Vanderbilt,  and future earning potential for life, 600k is not that much. 

I know the MLB scholarship fund is sold to players but think about it.  What is going to mature you as a person and allow you to find out who you really are and who you want to be?  Going to Vanderbilt ( or similar )  at this point and time in your life when you are 18-19  or going to low level pro ball with little supervision?   

maybe for some low level pro ball would make you "grow up fast"  but for me I would rather see him continue to improve as a person and a player as well as start working towards his degree.  

For instance, Vanderbilt allows all former players to return to school and if you are still playing pro ball you have your own locker, shower and so on.  2018 is already enrolled in a summer class with another incoming freshman pitcher from Ga.  They will start with the trainer and nutritionist working out on campus this summer and the class will lighten his class load next spring.  Not to mention the facilities , and perks..... charter flights, expense account

So in this case we feel he is setting himself up for not only a shot at the 2020 ( draft eligible soph)  or the 2021 draft but also a worthy degree and shot at Omaha....   then go into pro ball and basically skip the low levels,  and if he's good enough , pro ball will work out, if not  the degree could be worth 200K or more  for life.

I mean he's not going to the MLB in 2-3 years anyway ( if ever) so why not spend that time at college?  2018 got a text from a friend who did sign took the money and is already in rookie ball.... he's not so impressed with it.

 

TPM posted:
roothog66 posted:
TPM posted:

FYI, Uncle Sam takes 25% off the top, not for the very small bonuses paid out. Most of the larger bonuses are paid out in 2 payments, one after the draft and another in March. So a million payout is 500k, less 12.5% regardless of what tax bracket you will fall in. Then there is the agents fee, a good guy will split his fee in two payments. And then there are your state taxes.  

The MLB scholarship fund isn't what most think it is. Whatever you have negotiated, gets reduced each time you move up a level for no less than 90 days.  And then, believe it or not, you pay taxes on that scholarship money, which earns no interest.

I have been to this rodeo, so lets say a milllion after taxes, etc. becomes 700k which is a nice chunk of change. But I wouldnt let my son who is headed off to a college world series contender spend his time in the lower levels of milb. Ever.

JMO

And note that the 25% "off the top" is not enough to cover the tax bill for those who don't do much to protect that money then they get hit with a big surprise the next April. Paid out in 2 payments at least makes it all taxable at a lower %. 

Yes, who knows exactly what they will end up paying in taxes. I almost threw up when I saw what sons first check really was. We live in Florida so no state taxes. 

Then a lot of the kids go out and spend a lot on boy toys. They don't know how to save and their parents don't educate them on being responsible.

BTW, they don't split the payments to help the player out. Teams claim to be cash poor when first checks are drawn. You dont get drafted and paid right away. Ask if I feel badly for them. 

I don't.

 

 

Like to add a couple of things to TPM. Financial adviser mentioned that those athletes who go to college 3 - 4 years are USUALLY more responsible when dealing with finances and planning.  There is a tendency that those who will buy a fancy expensive toy are the high schoolers.

Also, it can be put in the contract if the bonus will be split up.  Not saying the MLB club will accept it but it can.  Son's team did split up the signing bonus over 2 calendar years.  Still got nailed by taxes/

bacdorslider posted:

Everyone's situation is different.   2018 had a number and if a club hit that number , he would have gone and we would have supported him  with housing , vehicle, insurance, cell phone just like I did the other sons while they were in college.   

While he could have agreed to what some would feel was a steep number, and went to rookie ball,  you have to factor in many variables some of which have been listed in this post.  Frankly,  600k  is a lot of money to me....  but when you compare it to the scholarship dollars he is receiving at Vanderbilt,  and future earning potential for life, 600k is not that much. 

I know the MLB scholarship fund is sold to players but think about it.  What is going to mature you as a person and allow you to find out who you really are and who you want to be?  Going to Vanderbilt ( or similar )  at this point and time in your life when you are 18-19  or going to low level pro ball with little supervision?   

maybe for some low level pro ball would make you "grow up fast"  but for me I would rather see him continue to improve as a person and a player as well as start working towards his degree.  

For instance, Vanderbilt allows all former players to return to school and if you are still playing pro ball you have your own locker, shower and so on.  2018 is already enrolled in a summer class with another incoming freshman pitcher from Ga.  They will start with the trainer and nutritionist working out on campus this summer and the class will lighten his class load next spring.  Not to mention the facilities , and perks..... charter flights, expense account

So in this case we feel he is setting himself up for not only a shot at the 2020 ( draft eligible soph)  or the 2021 draft but also a worthy degree and shot at Omaha....   then go into pro ball and basically skip the low levels,  and if he's good enough , pro ball will work out, if not  the degree could be worth 200K or more  for life.

I mean he's not going to the MLB in 2-3 years anyway ( if ever) so why not spend that time at college?  2018 got a text from a friend who did sign took the money and is already in rookie ball.... he's not so impressed with it.

 

With ya all the way, BDS, until the "then go into pro ball and basically skip the low levels".  VERY rare in my limited experience.  We had a guy drafted top of the second with a seven figure signing bonus.  Just like many others in his situation, he started in rookie ball and in year 2, is in advanced A despite decent success.  Seems like even very good P's drafted high still go through at least most of the levels and 'the process".  

cabbagedad posted:
bacdorslider posted:

Everyone's situation is different.   2018 had a number and if a club hit that number , he would have gone and we would have supported him  with housing , vehicle, insurance, cell phone just like I did the other sons while they were in college.   

While he could have agreed to what some would feel was a steep number, and went to rookie ball,  you have to factor in many variables some of which have been listed in this post.  Frankly,  600k  is a lot of money to me....  but when you compare it to the scholarship dollars he is receiving at Vanderbilt,  and future earning potential for life, 600k is not that much. 

I know the MLB scholarship fund is sold to players but think about it.  What is going to mature you as a person and allow you to find out who you really are and who you want to be?  Going to Vanderbilt ( or similar )  at this point and time in your life when you are 18-19  or going to low level pro ball with little supervision?   

maybe for some low level pro ball would make you "grow up fast"  but for me I would rather see him continue to improve as a person and a player as well as start working towards his degree.  

For instance, Vanderbilt allows all former players to return to school and if you are still playing pro ball you have your own locker, shower and so on.  2018 is already enrolled in a summer class with another incoming freshman pitcher from Ga.  They will start with the trainer and nutritionist working out on campus this summer and the class will lighten his class load next spring.  Not to mention the facilities , and perks..... charter flights, expense account

So in this case we feel he is setting himself up for not only a shot at the 2020 ( draft eligible soph)  or the 2021 draft but also a worthy degree and shot at Omaha....   then go into pro ball and basically skip the low levels,  and if he's good enough , pro ball will work out, if not  the degree could be worth 200K or more  for life.

I mean he's not going to the MLB in 2-3 years anyway ( if ever) so why not spend that time at college?  2018 got a text from a friend who did sign took the money and is already in rookie ball.... he's not so impressed with it.

 

With ya all the way, BDS, until the "then go into pro ball and basically skip the low levels".  VERY rare in my limited experience.  We had a guy drafted top of the second with a seven figure signing bonus.  Just like many others in his situation, he started in rookie ball and in year 2, is in advanced A despite decent success.  Seems like even very good P's drafted high still go through at least most of the levels and 'the process".  

Oh I am not saying he would skip rookie and low A , even A  entirely.   But he would have much shorter stints at those levels.  depending on the team and the round,  most teams are not drafting you at 21-22 to play any longer than you have to in the low rounds. Sure you will make "stops" there but they want a player drafted high out of college to be able to get a shot in 2-3 years...  If not they spent too much money on him.    

If you look at the history of Vanderbilt players taken in the top 5 rounds ( and believe me I have ) they are, barring injury, at least fast tracked to AA....  Fulmer, Buehler, Wright, Kendall, Cothan, Hill, Price, Gray, Flaherty,  Swanson,  Weil,  It's a long list.    

bacdorslider posted:

Everyone's situation is different.   2018 had a number and if a club hit that number , he would have gone and we would have supported him  with housing , vehicle, insurance, cell phone just like I did the other sons while they were in college.   

While he could have agreed to what some would feel was a steep number, and went to rookie ball,  you have to factor in many variables some of which have been listed in this post.  Frankly,  600k  is a lot of money to me....  but when you compare it to the scholarship dollars he is receiving at Vanderbilt,  and future earning potential for life, 600k is not that much. 

I know the MLB scholarship fund is sold to players but think about it.  What is going to mature you as a person and allow you to find out who you really are and who you want to be?  Going to Vanderbilt ( or similar )  at this point and time in your life when you are 18-19  or going to low level pro ball with little supervision?   

maybe for some low level pro ball would make you "grow up fast"  but for me I would rather see him continue to improve as a person and a player as well as start working towards his degree.  

For instance, Vanderbilt allows all former players to return to school and if you are still playing pro ball you have your own locker, shower and so on.  2018 is already enrolled in a summer class with another incoming freshman pitcher from Ga.  They will start with the trainer and nutritionist working out on campus this summer and the class will lighten his class load next spring.  Not to mention the facilities , and perks..... charter flights, expense account

So in this case we feel he is setting himself up for not only a shot at the 2020 ( draft eligible soph)  or the 2021 draft but also a worthy degree and shot at Omaha....   then go into pro ball and basically skip the low levels,  and if he's good enough , pro ball will work out, if not  the degree could be worth 200K or more  for life.

I mean he's not going to the MLB in 2-3 years anyway ( if ever) so why not spend that time at college?  2018 got a text from a friend who did sign took the money and is already in rookie ball.... he's not so impressed with it.

 

Great way to look at it overall. Think about it this way. For a player who falls into roughly the same category as your guy, they would arrive at MLB at basically the same time regardless of which route you take. Let's say you get real nice $$ & sign out of HS at 18. You are going to Rookie Ball, Low A, High A, AA, Maybe AAA all depending on development & results.

If you go 3 years to Top Shelf University & then sign in the same spot, you are probably going right to low A, then brief stops at High A, AA & maybe right to the show depending. So you are looking at trading 3 years at low level MILB vs 3 years at Vandy etc. No brainer........Unless you are looking at First Round $$ out of HS then maybe you take the $$ only if your kid can handle the MILB scene on a maturity level. 

 

A lot depends on the team that drafts the player. Some moves them up faster than others.

College players end up in short season college leagues. Mine was in high A his second season with the Cardinals.

HS players end up at the complex. It will take them at least 4 or 5 seasons to get to a ML team, IF that happens.

A pitcher who was drafted last year from Southern, a D2, is in high A, same organization.

Backdorslider,

You don't need to explain Ethans decision. I know how hard it was.  He chose wisely.  It's about him, but you will enjoy the next 2, 3 years a lot more than if he headed out to professional. Tell him Mrs. Kopp said so...lol.

Jeren Kendall, out of Vanderbilt, is still in High A ball in his 2nd year of Pro Ball at age 22, and he was a first round draft pick.  Ultimately you have to produce.  There is pressure both ways.  When you are 22 in High A competing against some 19 & 20 year olds, the clock is ticking....

I think it comes down to the individual.  If my kid was a pitcher I'd be a little scared of him playing college ball, if he has pro aspirations.  The college game can be abusive to arms.   For position players, it really depends on which program wants him and hundreds of other factors...  Just my quick 2 cents

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