The New Avery Rule

[I_H8_Crawford]

Didn't like him as a player, but an interesting article by Sean Avery discussing player salaries and such:

http://www.theplayerstribune.com/the-new-avery-rule/

[killer_carlson]

hmmmmmm

i wonder how popular he will be if the IRS has a boo into the NHL's use of per diem and its tax free status, given Avery's claim that everything the per diem is to cover is already provided by the team.

[Burke Salad]

Or you could um... get a job after the NHL thing is over!

[dissentowner]

No wonder guys want to sign with the Rangers.

[nfotiu]

I don't know about this math:

In truth, it isn’t. Taxes take about half (if you take no evasive tax action), agents take 25 percent, and the NHL snatches another 20 percent to put in escrow, which the owners balance out at the end of the season. Sometimes, they use the players’ cash to help small-market teams. Sometimes we’d get a refund. But for The New Avery Rule purposes, consider it gone. So really, that $13.2 million becomes $660,000 — which is still a lot of money, but you have to make that last for the next 50 or 60 years because if you have a five-and-a-half year NHL career, you’ve retired at age 25 or 26.

He's claiming he only gets to keep 5% of his earnings. I'm sure it comes out more like (((Salary minus 20% escrow) minus 25% agent fee) minus 50% income tax) which would leave them with more like 30% of their gross plus whatever they get back in escrow. So probably more like 4-5 million, not $660,000.

[mrkajz44]

This was the part that had me scratching my head:

Taxes take about half (if you take no evasive tax action), agents take 25 percent, and the NHL snatches another 20 percent to put in escrow, which the owners balance out at the end of the season. Sometimes, they use the players’ cash to help small-market teams. Sometimes we’d get a refund. But for The New Avery Rule purposes, consider it gone. So really, that $13.2 million becomes $660,000

He's basically saying you only get 5% after all taxes and expenses of your total salary. That cannot be true. I'm sure you can write off your 25%(!) agent fees and not pay tax on that, and the money in escrow should generally come back to you, or at least some of it.

I'm guessing the real take home is somewhere closer to 40%, so using the "average" salary and lifetime on an NHL play, you take home over $5M. Yeah, really got to start saving that per diem to make ends meet.

EDIT: Pretty much exactly what he said ^

[Trailer Fire]

25% to the agent? I highly doubt that. Most acting agents only take 3-5%.

[sevenarms]

And wouldn't the players receive the money back from escrow as long as league revenues are sufficient? Which I think they have been for the most part. I was also under the impression that agents received 3-5% of the contract value.

So if players paid 50% tax, 5% to their agent, and received their full escrow back, then they'd be walking away with 45% of their contract value. Not 5%.

[Blarg]

Reading that just solidified my opinion that Avery is a self centered idiot. The part where where he "needed" to buy a $28k car for appearances is terrible money management. Making a "rule" named after himself is pure ego.

[Kolbe31]

His agents must've been Jack Johnson's parents, 25% seems excessive.

[Hockeyguy15]

I wonder if he lumped multiple people into the "agents"? Maybe like a trainer, manager, his actual agent, ect.

[Huntingwhale]

I like that website. They have cool articles.

[getbak]

It's hard to find hard numbers for the final escrow values, but from what I could find, there's only been one season where the players lost more than 10% of their salaries to escrow. In 2008-09, the players made 87.12% of their contracted salaries.

There has also been at least one season where the players not only got all of their escrow money returned, but also received a bonus.


Either way, the agent's fees and taxes should be on the post-escrow value of the contract, not the pre-escrow amount.

[Poe969]

25%?!?!?!?!11?!?!?!/?!?!?1/1?!?!

My son is almost 2 and I always joke around with people and say he'll be in the NHL some day. My new dream job for him is to be an agent for players in the NHL.

[polak]

I definitely think he exageratted but still crazy to think how much money these guys lose to taxes. Not that they should be complaining. He'll be fine with his 4-5 million take home.

[Ashasx]

Players wouldn't have agents if the fee was 25% or anything close.

[DJones]

Originally Posted by Blarg

Reading that just solidified my opinion that Avery is a self centered idiot. The part where where he "needed" to buy a $28k car for appearances is terrible money management. Making a "rule" named after himself is pure ego.

He called himself an idiot for doing it... Not sure where the hate is coming from.

I didn't realize the escrow was so high. Wow.

It's a shame how agents, their friends and everyone else takes advantage of young athletes. It's unbelievable how many of them are broke by 30. It's an epidemic in the NFL anyway.

How some basic financial advice isn't given is a shame. Was happy Mony was with Hudler last year. Hudler doesn't seem the type to piss it all away.

[CliffFletcher]

The original version of this article stated that agents take 25 percent of total salary. A clarification has been made to reflect that agent and management fees take up 25 percent.

I don't dislike Avery. At least he has some original thoughts in his head. He'd probably be a more amusing person to sit beside on a long trip than most NHLers, who act as though they were all cracked from the same vapid and blithely conformist mould.

[corporatejay]

Originally Posted by polak

I definitely think he exageratted but still crazy to think how much money these guys lose to taxes. Not that they should be complaining. He'll be fine with his 4-5 million take home.

Same percentage as most of us, except I earn a fraction of what he earns.

[Eric]

If the fee was 25% for an agent, would that mean the agent takes home more than the player..?