The Way LeBron James Structures His Contracts Is Going To Make Him A Ton Of Money

ByJoey Heldon February 23, 2016inArticles›Sports News

There’s no doubt that LeBron James is one of the best basketball players to ever take the court. But what’s often overlooked, is that he’s a shrewd negotiator, too. And those business skills have helped him earn a ton of extra money already, with a lot more to come.

We’ve talked about how LeBron has structured his contracts since returning to the Cavs. To quickly recap: rather than signing a long-term deal, he’s signed short two-year contracts with a player option for the second year. He’s not doing this to hold Cleveland captive, but to maximize his earnings. Max players can earn up to 35% of the current NBA salary cap. And with a new TV deal about to kick in, the salary cap will soon skyrocket. It’s already increased quite a bit over the past few years. By essentially re-signing a new deal every year, LeBron has milked some extra money out of his owner’s pockets.

Consider this: he could have signed a max contract, a four-year, $88 million deal in 2014, his first year back in Cleveland. That contract would also have come with 4.5% annual raises. Rather than doing that, he signed his “one-year” contract, opting out before the second year to restructure the deal. He’ll likely opt out again after this off-season.

Jason Miller/Getty Images

There’s more incentive for LeBron to wait one additional year before going for a long-term deal. He’ll reach “Full Bird Rights” status in 2017, which means he can sign a five-year max contract with 7.5% annual raises. And, as the ever-increasing salary cap continues to explode, 35% of it looks even more appealing.

So how much extra money can LeBron make? B y waiting until 2017 to sign a long-term deal, he’d earn nearly twice as much than if he signed that contract back in 2014. A four-year deal two years ago would put LeBron’s potential career earnings at $214.2 million by the time the contract was up. If he waits until 2017 to sign a five-year contract, he’s projected to accrue $414.1 million in career earnings when that deal ends in 2022. Even signing a long-term deal this upcoming off-season would score LeBron a cool $95 million in additional earnings by the time it expires.

LeBron’s signing these two mini deals has proven to be fairly rare – most players in the league have taken the longer, more secure contracts when they’ve presented themselves, rather than trying to hold out for more money. Granted, LeBron is a freak of nature who rarely misses a game, so it’s a bit easier for him to bet on himself. But he’s 31, with nearly 38,000 minutes played under his belt. Will the durability be there for much longer?

It’ll be interesting to see when LeBron finally signs a long-term max deal. Either way, while his career earnings continuing to balloon, LeBron is well on his way to billionaire status .

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LeBron James Wants To “Break The Mold” With His Next Contract… Here’s What That Means

ByJoey Heldon January 3, 2018inArticles›Sports News

LeBron James will be a free agent this summer, which means people are already talking about where he’ll wind up. He could re-sign with the Cleveland Cavaliers. He may move out west and join the Los Angeles Lakers. Or he might form another super team, this time with the Houston Rockets.

Or maybe he’ll do something completely unexpected. After all, nobody saw him signing with the Miami Heat in 2010 or returning to Cleveland in 2014.

LeBron knows the media hangs onto his every word. He’ll throw a few tasty morsels out there every so often to stir the pot and get people talking.

“I want to kind of try to break the mold just for the next generation. Just take the narrative out of, ‘You’re past your prime when you hit 31,’ or ‘You’re past your prime in your 12th year in the league,’ or whatever the case may be,” James told Joe Vardon in an interview with Cleveland.com. “Hopefully I can break the mold so when the next guy comes, he can still get $200 or $300 million and be 33 years old. I’m serious.”

So… just what does LeBron mean by “break the mold?”

Thearon W. Henderson/Getty Images

For Cavs fans, they’re hoping LeBron means he’ll stop signing the short-term deals that he’s done the past few years and re-sign for the long haul. LeBron isn’t planning to take a discount to sign somewhere, and he’ll make the most money by staying in Cleveland. Based on current salary cap projections, he could make $207 million over five years with the Cavs.

LeBron was set to sign the first $200+ million contract two summers ago but was foiled by a peculiar league rule that players (including LeBron) have since altered to be more beneficial to athletes. Even 15 years into his career, he’s still playing at an MVP-caliber level. Most 33-year-old players aren’t the best in the league, so LeBron’s already breaking the mold in that regard.

However, LeBron could simply be talking about changing the narrative on how older players sign their contracts. Most players around LeBron’s age will sign one last long-term contract as their careers come to a close. He may be suggesting that they don’t have to do that simply for the security – one- and two-year deals can still be fruitful.

Whatever the case may be, LeBron’s free agency will be the biggest story this summer. Just about every other move will hinge on what he decides to do. And like his other career decisions, it will reverberate throughout the league for years to come.

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