Many of you
probably don't care about the NFL, but I am entrenched in it in my
everyday life. For those of you who don't know what I do for a
living, I work for a firm which provides financial advisor services to
active NFL players. These players include many names you have
heard of (Steve McNair, Roy Williams (Cowboys and Lions), Jeremy
Shockey, Todd Pinkston, etc.) My job is to handle the operations
of their money on a day-to-day basis. If a player is going to buy a
house, car, jewelry or land, or invest, or is considering anything
that's a major expense,
he usually talks to me along the way.
I give you that background so you understand where I am coming
from. I know what kind of money these guys make, and I also know
what they spend it on. Do I think they are over paid? Maybe, but
some of these guys certainly appreciate the big bucks they make, and
some don't. In the last few weeks we have watched star agent Drew
Rosenhaus and his top clients all threatening to hold out to get more
money. Let me explain this phenomenon to you. Each big-time
player is paid based on his value to the team and how he stacks up to
other players around the league at his same position. Now, the
crucial factor in all of this is the signing bonus. What most of
you don't realize is that in pro football the only money that is
guaranteed is the signing bonus.
When Shaquille O'Neal signed his 5-year 100-million dollar contract
last week, he set himself for life. Shaq will receive every penny
of that 100 million unless he retires before the 5 years is up.
Contrary to that, when Michael Vick signed his 7-year 100-million
dollar contract last year, the only thing guaranteed was the
30-million-dollar signing bonus he got up front. The Falcons
could cut Vick
today and keep the other 70 million. They would never do that
because they would have wasted 30 million for one year's worth of
work. But what they could eventually do is to ask him to
restructure his deal, trade him or cut him because they don't want to
pay the money.
When Terrell Owens threatened to hold out in camp, it wasn't
necessarily because he doesn't think his original contract didn't pay
him enough, it's because he thinks he should have gotten more than 7
million up front, because he is arguably the best receiver in the
game. Do I agree with that? Yes, but what I don't agree with is
the fact that he agreed to the deal last year and then decided one year
later that it isn't good enough. He should have not signed the
deal last year, and forced somebody to pay him what he is worth.
Now that you have some insight on NFL contracts you hopefully will
understand both the team's argument and the players', the next time
favorite player threatens to hold out.