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 about 60 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 your favorite player threatens to hold out.