MLB Draftee's Playbook: Hiring Your Financial Team at the Right Time
- Scott Morrison
- Sep 16
- 6 min read
The biggest financial mistakes most MLB Draft picks make have nothing to do with baseball.
They don’t come from strikeouts, slumps, or stat lines. They come from what happens off the field — and when they make their first financial decisions.
And almost all of it comes down to one choice: They wait to hire their financial team.
MLB Draft Window
For most players, Draft Day feels like the finish line. But financially, it’s the starting block.
Those first 30 days are when the most important decisions get made:
Where you establish residency.
How your signing bonus is structured.
When you fund retirement accounts.
Who you trust to guide you through it all.
Get those moves right, and you build a foundation for decades of growth. Get them wrong, and you can fall behind before you make your professional debut.
Want a full breakdown of how the MLB Draft works? Read The Moment Guide to the MLB Draft.
Here’s a real example of how timing can change everything.
The difference shows up fast — and it starts with when you build your team.
Pre-Draft vs Post-Draft: The Real Difference
Before we dive into the numbers, let’s bring this to life. Every year, we see talented players step into the draft with similar tools, similar upside, and similar financial opportunities — but end up on completely different paths based on how early they build their team.
The contrast is striking, and it comes down to one thing: timing.
These two players entered the same draft, were both top 50 prospects, but made their decisions on very different timelines.
One brought us in early — well before their first dollar ever hit the account.
The other waited until after the draft, when the opportunities for proactive planning were far more limited and felt rushed.
This one difference in timing created two very different financial futures.
🟢 Player A: Hired Early and Planned Ahead
What We Planned for Ahead of Time:
Established residency in a no-tax state before signing
Coordinated contract structure with their agent and financial team
Contributed to a Solo 401(k) and MiLB 401(k) early
Ran full tax projections before their first tax season
Set up banking, payroll, and legal protections from Day One
Impact of Early Planning ~ $130,000+ in total savings
~$100,000+ from state tax savings
~$25,900 from Solo 401(k) tax benefits
~$8,700 from MiLB 401(k) contribution
Result: Player A started their career with structure, clarity, and momentum. They had their tax strategy, cash flow plan, and savings vehicles in place before they even stepped foot on the field — which meant they could focus entirely on baseball.
🔴 Player B: Hired Late and Played Catch-Up
What Couldn’t Be Planned and Implemented in Time:
Missed residency window → taxed as a resident of a high-tax state
Missed opportunities to optimize payment timing and terms
No retirement contributions in Year One
Tax planning was reactive instead of proactive
Managing avoidable issues instead of enjoying a huge payday
Cost of Waiting ~ $180,000+ in lost opportunities
Extra state taxes paid
Missed Solo and MiLB 401(k) tax savings
Result: Player B followed a comparable path with comparable upside — but was already playing financial catch-up. Instead of building wealth, they were scrambling to fix costly mistakes from day one.
Their careers started the same, but their planning didn’t — and the results show it.
When MLB Draftees Should Hire a Financial Team
That gap wasn’t about talent — it was about timing.
Draft picks assume they’ll have time to figure it all out later. But many of the biggest financial levers can only be pulled before your bonus hits or within the first few weeks of signing.
If you miss them, they’re gone — and they don’t come back.
Something to consider is also knowing the details around your signing bonus. Lucky for you, we have you covered: MLB Signing Bonus Explained: A 1st Rounder's Story
Here’s why early planning changes everything:
Residency Planning
Where you live when you sign your contract determines which state claims income tax on your signing bonus. For high-tax states, that can mean 10%+ of your bonus is gone before you touch it. If you wait until after signing to move, you’ve already missed the window.
Contract Structure Coordination
MLB teams can structure signing bonuses across different tax years. That affects which tax bracket you land in and how much you owe. Without planning, players often receive their bonus in a way that maximizes their taxes instead of minimizing them.
Retirement Contributions
Solo 401(k)s and the MiLB 401(k) are powerful tools to reduce taxable income and start compounding early. Waiting means you lose an entire year of contributions, growth, and tax savings — and the IRS doesn’t let you retroactively go back.
Legal & Insurance Protections
Disability insurance, liability coverage, wills, and POAs protect your career and your family. They’re easiest and cheapest to get before there’s a problem. Once something happens, it’s usually too late.
Players who hire early don’t just save money — they gain clarity, control, and peace of mind.
They step into their pro careers prepared, not panicked.
The First 90 Days
Most draft picks think of their signing bonus as a reward. The best ones treat it as seed capital.
It’s the only time in your life where you can convert a single check into lifelong financial security — if you plan for it.
Instead of asking: “What can I afford now?” Ask: “How do I turn this into long-term wealth?”
That’s what separates the players who are broke five years after retiring from the ones who never have to work again.
Here’s what an early team will actually do before your first game:
Residency planning and documentation — to establish tax domicile and maximize state tax savings.
Tax projections and withholding setup — to avoid surprises and plan cash flow around what you’ll owe.
Retirement account contributions — Solo 401(k) and MiLB 401(k) to reduce taxable income and jumpstart compounding.
Contract structure review — to align bonus payouts and salary timing with your tax strategy.
Legal and insurance protections — disability, liability, and estate documents — should be in place before they’re ever needed.
Budget and cash flow strategy — to manage living costs, training expenses, and savings goals with clarity.
This structure gives you clarity, confidence, and control — instead of scrambling because you didn’t plan ahead.
The Cost of Waiting
Waiting isn’t neutral — it’s expensive
Surprise tax bills — from missed projections and poor withholding.
Lost state tax savings — by missing the residency window.
Missed retirement contributions — delaying compounding and long-term growth.
Unfavorable contract terms — from uncoordinated bonus and salary structures.
Financial stress and distractions — instead of clarity and focus on the field.
By the time most players finally call for help, they’ve already lost opportunities they can’t get back.
Key Takeaways
Hiring a financial team early isn’t overhead — it’s leverage. It protects what you earn and multiplies what you keep.
The most expensive mistakes happen in the first 30 days. Once they’re made, they’re hard or impossible to undo.
Waiting doesn’t save you time — it costs you money. The earlier you build the foundation, the further you get ahead.
The Bottom Line
If you’ve just been drafted — or expect to be soon — now is the moment to build your financial team.
Don’t wait for check-cashing or tax season surprises. Let’s run your numbers, map your strategy, and help you keep more of what you earn.
Schedule a call with Moment Private Wealth today. We specialize in turning draft victories into lifetime financial wins.
Get in Touch With An Advisor
Frequently Asked Questions
Here are some answers to questions received regarding athletes and money:
When does Moment start working with future MLB draftees?
We start working with families often a year before the MLB draft. Our goal is to ensure every family is educated on their options and can enjoy the draft when it comes.
Does Moment help players with state residency?
Yes, Moment has a checklist we walk every player through to ensure they are compliant in navigating state residency.
How does Moment work with my agent?
Moment works with every major sports agency, and that collaboration ensures all of our athletes maximize not just their signing bonus but their career earnings.
Does Moment provide tax planning and strategy for MLB draftees?
Yes, we handle all of our athletes' tax planning and team coordination. As part of your team at Moment, you will be working with a sport-specific CPA firm specializing in navigating everything that comes with athlete taxation.
*Moment Private Wealth offers information on tax and estate planning that is general in nature. Tax and Legal advice are not provided by Moment Private Wealth. Consult an attorney or tax professional regarding your specific legal or tax situation.
