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06/05/2014

TCU baseball coach shows how fast the guaranteed $$ of the MLB draft goes

Tyler-Kolek-600-2Today is the annual Major League Baseball draft, a time of great angst for both the big leagues and college teams. Will the high schooler take the guaranteed money of a signing bonus, or go to college?

Every year, TCU baseball coach Jim Schlossnagle makes his best pitch to the high school kid who is torn between the desire to play pro baseball, take a guaranteed check, and attending school.

Schlossnagle, as well as a slew of other college coaches and agents, have all of the economics broken down to make their case. In many cases, the smart financial play is to turn down the money and start working towards a degree while playing baseball.

Schlossnagle was nice enough to share with me some of the numbers ... which may both surprise, and depress, you. The following are figures that a Fort Worth accountant estimated for Schlossnagle, and are all based on Texas residency.

$100,000 Signing Bonus
After taxes (34.5%) $65,500
After advisor fee (3%) $62,500
After living expenses: -$9,500
(per US census bureau: $18,000 per year minimum; $18,000 x 4 years to MLB=$72,000)
Does not take into account car or other extravagant purchases.

$500,000 Signing Bonus
After taxes (34.5%) $327,000
After advisor fee (3%) $312,000
After car purchase ($30,000) $282,000
After living expenses: $156,000
(per US census bureau: $18,000 per year minimum; average time for MLB for high school player=7 years; $180,000 x 7 years to MLB = $126,000)

$650,000 Signing Bonus
After taxes (34.5%) $425,750
After advisor fee (3%) $406,250
After car purchase ($30,000) $376,250
After living expenses: $250,250
(per US census bureau: $18,000 per year minimum; average time for MLB for high school position player=7 years; $180,000 x 7 years to MLB = $126,000)

$1,000,000 Signing Bonus
After taxes (34.5%) $655,000
After advisor fee (3%) $625,000
After car purchase ($30,000) $585,000
After living expenses: $469,000
(per US census bureau: $18,000 per year minimum; average time for MLB for high school position player=7 years; $180,000 x 7 years to MLB = $126,000) 

Minor League Pay
$5,500 per year salary
* Avg monthly salary in lower level of minor leagues: $1,100 per month
* You get paid for the time you play; 5 months per year
* You do not get paid during spring training
* You do not receive meal money or housing stipend while in "home city"

@MacEngelProf
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Comments

David

But numbers are the same whether you are a high school or college player? And you can always go back to college, most deals have in them that Pro team will pay for it. Plus, you don't hav ethe expense of college....very few if any baseball players get full rides...only 11.7 scholarships for 25 players. And Purke and other pitcher's use and subsequent injuries doesn't help his case.

Kev

If the NCAA wanted players to choose going to college over the pros, they would allow more than 11.7 scholarships per team. That is one of the dumber NCAA rules (and Lord knows they have alot of dumb rules).

It would be a win win for everyone. The MLB would get a FREE minor league system like the NBA and NFL have. Some schools generate more money for baseball than they do basketball (TCU *cough cough) so they need more than 11 scholarships. Just dumb

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