Bryce Harper to Phillies; 13 years, $330M

[homer]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

[Ennder]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

It is certainly the majority of it but do you think Harper is buying a cheap house?

[homer]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

It is certainly the majority of it but do you think Harper is buying a cheap house?

 

No, but he also has to live in Philly and not San Diego.

[FVBrewerFan]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

It is certainly the majority of it but do you think Harper is buying a cheap house?

 

Yea, but its an investment not a cost. More than likely he would make MORE money in San Diego selling his house vs Philly. Not to mention he may not even want a house in Philly. All that said, its a non-issue anyhow since its a small fraction of his salary.

 

What IS a real factor is state income tax. My guess is PA taxes are high, but CA even higher.

[SRB]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

[SRB]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

It is certainly the majority of it but do you think Harper is buying a cheap house?

 

No, but he also has to live in Philly and not San Diego.

 

Philly >>> San Diego unless you want to live on a military base or in a zoo

[adambr2]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

 

No. But I think he might have been able to get 4/168 now and then 10/300 after that.

 

As you mentioned though I certainly can't blame him for taking a guaranteed third of a billion right now.

 

The lack of an opt out does surprise me. It's not just about wanting to spend the rest of your career there, it's a leveraging tool for players.

[Fear The Chorizo]

For what it is worth, PA state income tax is a flat 3ish percent, regardless of income level, while CA has a base rate of 7.25 percent and a top marginal rate of over 12 percent....just comparing CA's base rate to PA at a $25M annual salary, it's a $1M plus annual savings for Harper to get his paychecks from a pennsylvania workplace.

 

He is already used to living on the east coast half the year, moving from DC area to philly is actually a cost savings, too...not that he really needs it anymore!

[502 to Right]

It's pretty obvious to me why Machado and Harper took the most guaranteed money over the potential for more money. They can have a career ending injury tomorrow and they are getting PAID. A bird in the hand...

[brewcrewdue80]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

 

10/300=30per

13/330=~25.4per.

 

That's 4.6mil a year less. I gave 4.5mil a modest 6.5% return if invested over 10 years. What is 45mil base at the 10year mark becomes $64,872,836. On that modest return he'd only need 10mil? over the next 3years signed to earn 330mil. But you know, he didn't go to College so maybe he has zero sense when it comes to investing. Pay a guy to do it for him.

[Oxy]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

 

10/300=30per

13/330=~25.4per.

 

That's 4.6mil a year less. I gave 4.5mil a modest 6.5% return if invested over 10 years. What is 45mil base at the 10year mark becomes $64,872,836. On that modest return he'd only need 10mil? over the next 3years signed to earn 330mil. But you know, he didn't go to College so maybe he has zero sense when it comes to investing. Pay a guy to do it for him.

 

How much should he pay a guy "to do it for him?" Tricky business, financialz.

[homer]

San Diego has a 50% higher cost of living than Philly? I am guessing that is entirely driven by housing costs.

It is certainly the majority of it but do you think Harper is buying a cheap house?

 

Yea, but its an investment not a cost. More than likely he would make MORE money in San Diego selling his house vs Philly. Not to mention he may not even want a house in Philly. All that said, its a non-issue anyhow since its a small fraction of his salary.

 

What IS a real factor is state income tax. My guess is PA taxes are high, but CA even higher.

 

One site I saw had it about 1.5% more in CA.

[homer]

For what it is worth, PA state income tax is a flat 3ish percent, regardless of income level, while CA has a base rate of 7.25 percent and a top marginal rate of over 12 percent....just comparing CA's base rate to PA at a $25M annual salary, it's a $1M plus annual savings for Harper to get his paychecks from a pennsylvania workplace.

 

He is already used to living on the east coast half the year, moving from DC area to philly is actually a cost savings, too...not that he really needs it anymore!

 

City of Philadephia has a wage tax. 3.88%

[Roderick]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

 

10/300=30per

13/330=~25.4per.

 

That's 4.6mil a year less. I gave 4.5mil a modest 6.5% return if invested over 10 years. What is 45mil base at the 10year mark becomes $64,872,836. On that modest return he'd only need 10mil? over the next 3years signed to earn 330mil. But you know, he didn't go to College so maybe he has zero sense when it comes to investing. Pay a guy to do it for him.

 

Has it been confirmed that the salary is basically the same year after year? Could be he negotiated front-loaded years. Doubtful, but possible.

 

 

It seems to me, for these big free agents, the agent (and probably the union) is always shooting for the biggest number, regardless of deferrals or backloading. They just want to be able to advertise the big number to clientele (or save face with a client if he told Harper he would get X amount of $).

 

 

And in some instances, I assume the agent can feel like they are protecting the player from himself, if he is a free spender - by pushing the contract out.

[homer]

Philly >>> San Diego unless you want to live on a military base or in a zoo

 

So you've seen Top Gun and Anchorman.

[SeaBass]

Not sure why some find this deal odd. If I was in Harper's situation I would absolutely take this deal that guarantees me a third of a billion dollars (plus marketing money in a major metropolitan area where he will be the biggest star) and piece of mind that I will never have to go through free agency again. He's set for life and can just focus on his playing.

 

It's also much better than 10/$300. Are either Harper or Machado likely to land a $30+ million plus contract in their late 30s?

 

10/300=30per

13/330=~25.4per.

 

That's 4.6mil a year less. I gave 4.5mil a modest 6.5% return if invested over 10 years. What is 45mil base at the 10year mark becomes $64,872,836. On that modest return he'd only need 10mil? over the next 3years signed to earn 330mil. But you know, he didn't go to College so maybe he has zero sense when it comes to investing. Pay a guy to do it for him.

10y/$300M plus 3y/$0 = 13y/$300M

 

I'll take the 13y/$330M over that every single time. No investment tricks necessary.

 

It is strange to assume he doesn't already have a well established investment strategy in place though. He's been in professional baseball since 2010.

[RobDeer 45]

At first I thought this contract was nuts, but after some time to think about it, it's not that bad. Obviously he could be a shell of himself by the time it is over, but I bet PHI makes more than his contract back over the next few years. Hard to calculate that, but there will be a huge buzz for awhile because of him. Good investment from that standpoint.

 

As for why he'd go 13 over 10 years. Seems simple. He's set for the rest of his career. He could have gambled but who would actually think he'd be worth much at age 36. If you aren't going short, like a 4 or 5 year, in hopes of getting another monster deal, mind as well sign something that goes for the rest of your career. Good move by him.

 

I think they can still get trout. This contract is spread over a long period of time.

 

SRB - I know that's your opinion, that PHI is a better place than SD, but man, I don't know who else has that opinion, except someone from PHI. If you're just talking about what each city has to offer, I bet 98 out of 100 would take SD. But hey, it's your opinion, so that's cool.

 

Those crunching numbers on cost of living and taxes and all that, I think it's all irrelevant at this point. Dude is getting $330 mil, and who knows what else in endorsements. He could live on the moon and the cost of living wouldn't effect him much.

[MrTPlush]

The Phillies sold 100,000 tickets yesterday after the news broke. That is likely a surge of around $4,000,000 from increased ticket sales on ONE DAY ALONE. It wouldn't really shock me if Harper is generating over $25mil in off the field revenue streams in his first year. The jersey sales are going to be off the charts. I think the impact of getting one of these guys in FA is really understated financially. Extending a guy is usually not a big revenue stream because the fans probably already have the merchandise over the years and it isn't going to generate major excitement.

 

However getting Bryce Harper, one of the faces of MLB, out of nowhere to be on your team is just insane. Harper was #13 in jersey sales last year despite being on the same team for 7 years. That is especially crazy when you consider many thought he was on the way out the door and was in his walk year. Yet everyone and their brother in Philly wanted his jersey.

 

While off the field revenue generation quickly tails off from what it will be this year it is still major. Not to mention if Harper reverts back to an MVP level of play the revenue will keep trickling in until multiple generations die off and don't remember him anymore.

[Warning Track Power]

Philly >>> San Diego unless you want to live on a military base or in a zoo

You quite obviously have never been to San Diego

[yfinn6]

 

Philly >>> San Diego unless you want to live on a military base or in a zoo

 

 

[bill hAll Star]

I don't have a problem with either city (Philly or SD) but he might...just might...have enough money to live in Philly from April through October and then move to somewhere like San Diego from November through February (and of course Florida for March). That's the beauty of playing the actual season in the summer.

[tmwiese55]

Turns out he's from Las Vegas, I wonder if he would spend a lot of time there over the winter

[wallus]

The weather is better in San Diego but you would have to put up with the residents of those places as well...

[danzig6767]

 

Those crunching numbers on cost of living and taxes and all that, I think it's all irrelevant at this point. Dude is getting $330 mil, and who knows what else in endorsements. He could live on the moon and the cost of living wouldn't effect him much.

No kidding

 

People talking about tax rates and whether Harper may have made more money had he signed a shorter deal elsewhere.

 

He already had made 47 million while playing with Washington to make him set for life with just a shred of common sense and now he's set to earn another 330 million.

 

Regardless of tax rates and cost of living amounts in whatever city, Harper will make almost 400 million for his career. Let the number sink in. 400 million dollars. That's incredible wealth. He could live very comfortably just on interest of that wealth if done smartly.

[homer]

 

Those crunching numbers on cost of living and taxes and all that, I think it's all irrelevant at this point. Dude is getting $330 mil, and who knows what else in endorsements. He could live on the moon and the cost of living wouldn't effect him much.

No kidding

 

 

Regardless of tax rates and cost of living amounts in whatever city, Harper will make almost 400 million for his career. Let the number sink in. 400 million dollars. That's incredible wealth. He could live very comfortably just on interest of that wealth if done smartly.

 

I get your point but after taxes and after paying his agent (is it 3% or 6%?) it's more like $155 million or thereabouts. Still, your point remains. He could invest not smartly and still live off interest.