How Much Would You Sign For?

The Pirates concluded their portion of the 2014 MLB Draft today when they made their selection in the 40th round.  Counting two extra picks in the compensation rounds, the Pirates selected 42 high school and college kids.  Not every kid will sign, based on a combination of their bonus demands and the Pirates' draft pool of $7.0M.

How much each kid requires to sign is a complicated calculus of figures, though, that is roughed out by the area scout who has spoken with him at some point.  I'm wondering how much it would take for me to recommend my son sign, especially out of high school.

The Pirates selected a high school pitcher named Mitch Keller out of an Iowa high school in the 2nd round.  The slot value for that pick is $886,800, as per figures obtained by Baseball America.  Keller has been rated as a 2nd or 3rd round talent all spring, so he was picked right where he was rated.  He does have a college commitment to North Carolina, so it would appear that he may take a little over slot to sign and be difficult to get under contract.

But then I found an article with an interview from last month that Keller gave to his local newspaper.  In it, he tells the story of how his older brother, Jon, gave him some advice from his own situation.  The cautionary tale tells how Jon was drafted in 2010 by the Mariners and turned down a high six figure bonus to go to college.  In college, Jon developed arm troubles and was then drafted by the Orioles in 2013 and received only $100,000, a much lower figure than what he turned down in 2010.

His brother has told him that if the money is life-changing he should take it, because you never know what may happen in the future.  The $100,000 that Jon received sounds like a lot, but after 5% off the top for agent fees and then roughly 35% of taxes, Jon Keller only cleared approximately $60,000.  Good money, but not life-changing.

If Mitch Keller were to sign for (rounding up) $900,000, he could clear $550,000 probably.  That's not money to live off of the rest of your life, but that's a real nice start to a nest egg.  He wouldn't have to worry about a ton of stuff if his career flamed out early.

For me, if my son could sign for $500,000, that would be a net of about $300,000.  That would enable him to put a down payment on a nice house and get a nice car after his baseball career was over.  He would have to work, but some of the hassles of life would be reduced for him.  That amount is the slot value at the end of the 3rd round in this year's draft.

College is always there; it's not going anywhere.  Many teams will sweeten the deal for high school picks by promising four years of tuition to a college, as well.  At that point, it's almost a no-brainer.  Allow your son to pursue his baseball dream, then he can go back to college after it's over on someone else's dime.

I hope the Pirates can sign as many of their high school picks as possible, but they won't get them all.  I just hope that some of them don't sign just because it's not for every last dollar they think their son deserves.  Sometimes it's worth getting the bird in hand, instead of waiting for two in the bush.