WHEN someone retires, usually it means that that somebody will be free from the daily grinds of work and signals the end of a person’s regular income-generating ability. Thankfully, there are pension/retirement plans that compensates for the loss of earnings.
As for athletes, they don’t play forever and depending on one’s ability and durability, they could either have a long and productive career (20 years or more) or a brief and uneventful one. With their huge salaries, these athletes earn millions that we ordinary species can only dream of. Sadly, more than 70 percent of them had squandered their earnings and ended up bankrupt and swimming in liabilities.
We had heard of sad stories of NBA players who ended their playing careers in debt because of ill-advised purchases, gambling and substance abuse. But a select few had left the game as multimillionaires but still do receive salaries from their former teams.
Pro basketball players enter the league with complicated contracts that could compel their teams to pay them long after they had given away their sneakers to fans and collectors alike. The league’s Collective Bargaining Agreement allows teams to adjust a waived player’s remaining salary on their contract to a longer period than the term left which that player could have been fully paid.
Also called the “stretch provision,” the team may double the term of the remaining number of years left on the waived player’s contract plus one year. Because, retired or not, money due to players is included in the team’s salary and the restructuring will allow the team to soften the salary cap hit that would have affected them because of such player’s salary.
Here are some NBA retired players receiving pensions from their former teams because they had signed contracts that guarantee payments whether they’re on the team or are actually out of basketball.
GILBERT ARENAS. Hoping Agent Zero will help improve their team, Washington in 2008 signed him to a six-year, $111-million contract but it was not meant to be. Attitude problems sent him and his contract to Orlando in 2010 and he was eventually waived a year later. Just loafing around, the stretch provision paid Arenas $22 million a year up to 2016.
JOSH SMITH. Drafted 17th straight out of high school by Atlanta, the man also known as “J-Smoove” was responsible for the Hawks’ return to the postseason in 2008 until he left via free agency in 2013 and signed a four-year, $54-million deal with Detroit. The honeymoon lasted only two years and the Pistons released him with two years left on his contract. With the stretch provision, Smith gets $5.3 million yearly until 2020.
TIM DUNCAN. The Big Fundamental retired in 2016 but still gets $1.6 million annually until the 2018-2019 season. Duncan retired with one year and $6.4 million left on his contract but he and the Spurs agreed on a buyout.
KEVIN GARNETT. KG also retired from active basketball in 2016. Without playing a single game for Minnesota, he still received an $8-million payout last season. He is still due $35 million as his deferred salaries from the two contract extensions with the Celtics spread over seven years. Until 2022, KG will have $5 million annually. At least we now partly know why they call him The Big Ticket.
Not only does the NBA have the highest average annual salary in all professional sports but through contract provisions, they also give some extra retirement compensations running for a few years./PN
