Financial Impact of McCullough's Decision

Full breakdown of the financial implications of Chris McCullough's decision. Will he make more money if he stays or if he goes? The answer may not be as obvious as many think.

Chris McCullough is considering leaving Syracuse and entering the NBA Draft this year, despite tearing his ACL in the middle of this past season according to Donna Ditota of Syracuse.com. One main reason players leave the college ranks early is because the money is too great to pass up.

But is it really? Is it better to have one extra year of income or wait it out for more money per year down the road? In McCullough’s case, what are the financial implications of this decision?

The NBA lottery consists of the first 14 picks of the draft. Should McCullough stay for one more season, that is his likely destination in 2016. Leaving this year puts him further down the board, an unlikely lottery selection and a lower per year salary. He does, however, have an extra year of income.

There are two scenarios McCullough has to evaluate. Will he make more money with four years of salary in this year’s draft or three years of NBA salary in the 2016 draft? Comparing those two scenarios takes into account the extra year of salary but still compares total income earned in both.

A lot depends on draft position in both years.

The general consensus is that McCullough will be a lottery pick in 2016 while he will slip to the end of the first round, at best, in the 2015 draft. So let’s take a look at the finances surrounding those options.

How much money will he make over the next four years if he is taken with the 28th pick in the draft? The salaries for NBA rookies works on a sliding scale. The higher you are drafted the more money you make each year.

According to Basketball Insiders, the 28th slot in the rookie wage scale is set at $957,200 for the first year. His salary in the three years after that would be $1,000,200 in year two, $1,043,300 in year three and $1,877,940 in his final year.

That is a total of $4,878,640 over four years.

The projected salary for the 2016 draft class shows a significant increase assuming McCullough lands in the lottery. His salaries over the first four years of the deal if he is selected at pick 14 (the last slot in the lotter) are $1,743,500 in year one, $1,822,000, in year two and $1,900,500 in year three.

That is a total of $5,466,000 over four years, if you consider year one would have no income since he would still be at Syracuse.

If you compare the two numbers, McCullough would stand to earn $587,360 more over the same time period if he stays at Syracuse for one more season. The increased income would be even greater the higher in the lottery he goes.

For example, if he is taken with pick seven, he stands to make over $3.5 million more over the same four year time period.

Now it is entirely possible that McCullough goes higher than the 28th pick. If he lands at the 25th spot, he still makes over $200,000 more by staying the extra year over the same four year span if he lands at pick 14 in 2016.

At what pick does McCullough start making more if he leaves than if he lands at the 14th pick in the 2016 draft? If McCullough is taken with the 23rd or better pick, he makes more money by leaving this year.

But again, that assumes he is taken with the last pick in the lottery in 2016. If he were to be a top-10 pick in 2016, a reasonable assumption considering some mock drafts have him as a high as the fifth pick, he will make $6.7 million through the first three years of the contract (or the next four years overall).

In order to surpass that amount of money, he will have to be the 17th pick or higher in this year’s draft. That does not seem very likely given the concern over his ACL injury.

McCullough will not likely be ready to significantly contribute in the NBA regardless of which year he declares. That does not matter to NBA executives, however. His skill set and upside, the two most important buzz words with pro prospects, are coveted.

That is why, even with his injury concern, McCullough would be a likely late first round draft pick by a savvy team looking for value. He would be among the most talented players at that point in the draft.

But further removed from that injury, with a strong sophomore campaign at Syracuse, he would be a near lock to hit the NBA Lottery in 2016 for those same reasons.

The last thing to consider is earning that second contract, which is generally more lucrative than the rookie deal. That is, of course, if the player has performed well enough to earn a large contract.

If McCullough leaves early, he is one year closer to the second contract. The problem is, given that he where he would be selected, he would likely be on a team that does not need to use him on the court for the first couple of years. That impacts his ability to prove he can play at the NBA Level, and may impact his ability to earn a larger second contract.

Therefore, staying an extra year and being drafted by a team that forces him onto the court a little earlier may actually help him earn a larger second contract. Regardless, he will have to play well and prove he is worthy of a large financial commitment.

The scenario of staying an extra year provides more guaranteed money just in case the second contract does not end up being as large as desired.

Given the financial implications as outlined above, it actually may make more sense to stay. In the long run, there will be more money in his pockets even with the extra year of income.


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