Moment MLB Signing Bonus Guide: A Draft Playbook

Draft day is electric. Years of work finally pay off - and for the first time, life-changing money is on the table.

But here’s the reality no one tells you:

That headline signing bonus? It’s not what actually lands in your account. And the decisions you make in the first 90 days determine whether that moment becomes a launchpad for long-term wealth… or a story of missed opportunity.

At Moment Private Wealth, this is where we come in. We help athletes take control of the money game - so they can focus on the actual game.

The Illusion of the Bonus

The average signing bonus of the first 43 picks in the 2025 MLB Draft was $4,338,931.

Here’s what that really looks like after taxes and fees:

• Federal Income Tax (~37%): ~$1.60M

• Agent Fees (5%): ~$220K

• State Income Tax (North Carolina @ 4.25%): ~$180K

  
  

➡ Total Costs: ~$2.0 million➡ Net in Your Account: ~$2.34 million

That means roughly half your bonus is gone before you make a single financial decision. This is why the first 90 days matter so much. The earlier you put structure in place, the more control you’ll have over what you keep.

The Payment Schedule: Two Checks, Two Tax Years

One often-overlooked detail: your signing bonus usually isn’t paid in one lump sum. For most players, it comes in two installments over two calendar years:

• First 50% — typically 30-45 days after your contract is approved.

• Remaining 50% — paid the following year, usually between January and April, depending on the team’s payroll schedule.

  
  

For example, on the average $4.34M bonus:

• ~$2.17M arrives within weeks of signing.

• ~$2.17M comes in early the next calendar year.

  
  

This structure has major implications for tax planning, cash flow management, and investment timing. Knowing when your money hits is just as important as knowing how much.

The higher the draft pick the more leverage you have to negotiate how your signing bonus is paid out. That leverage can open the door to further tax planning opportunities based on the percentage paid out in a given year.

State Residency for Athletes

Residency is one of the most misunderstood aspects of professional sports. Where you live on draft day has an outsized impact on your finances.

• MLB spring training happens in Florida (0% tax) or Arizona (2.5%).

• Establishing residency in one of these states can create six-figure savings.

• Example: California (13.3%) vs. Florida (0%) on a $4.34M bonus = $576,000+ swing.

But this isn’t just swapping your driver’s license. A proper residency plan includes housing, documentation, lifestyle alignment, and ongoing proof to withstand scrutiny from state tax authorities. We guide clients through this step-by-step and coordinate with CPAs, agents, and payroll departments to ensure it’s done right.

Retirement Accounts: The Hidden Advantage

Most players think retirement accounts are for the future. In reality, they’re a tool to save money now and build wealth for later.

• MiLB/Solo 401(k): Contribute up to $70,000 and deduct it from taxable income.

• Backdoor Roth IRA: Add another $7,000 with tax-free growth.

  
  

Together, these moves can reduce your tax bill by ~$27,500 in year one. More importantly, it jumpstarts compounding - turning today’s dollars into tomorrow’s wealth.

Investing Like a Pro Athlete (Because You Are One)

Getting money in the door is only half the battle. The real question is: How much do you keep after taxes and bad investment choices?

Athletes earn early, peak fast, and face unique risks. That’s why we design portfolios with an emphasis on flexibility and tax efficiency:

• Municipal Bonds: Generate tax-free income.

• ETFs & Individual Stocks: Provide more control and efficiency than traditional mutual funds.

• Donor Advised Funds: Lock in charitable deductions while supporting causes you care about over time.

Our goal is simple: growth that matches your career arc and maximizes after-tax returns.

Why the First 90 Days Define the Next 30 Years

Draft day is a milestone - but it’s only the beginning. The financial moves you make in the weeks after being drafted will echo for decades.

This is why Moment Private Wealth exists. We’re not product salespeople. We’re fiduciaries - CFPs and investment professionals dedicated to building financial game plans for top MLB Draft Picks and the games biggest stars at their most pivotal moments.

Key Takeaways for Draft Picks

1. Half of your bonus disappears fast — taxes and fees take a huge bite before you ever touch the money. Plan for the net, not the headline number.

2. Your bonus comes in two checks — one soon after signing, the other the following year. Plan for both tax years.

3. Residency is a game-changer — choosing the right state could mean six-figure savings in year one alone.

4. Retirement accounts are tax weapons — use them early to lower today’s bill and build long-term wealth.

5. After-tax investing matters most — the goal isn’t just growth, it’s keeping as much of that growth as possible.

6. The first 90 days set the tone — the right structure now creates clarity, security, and momentum for decades.

   
   

   If you’re ready to see how much of your bonus you can truly keep and how to turn it into long-term wealth, let’s run the numbers and build your playbook today.

   
   

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If you are an athlete or the family of an athlete exploring the MLB draft, connect with our team.

Moment was built to serve the specific needs of professional athletes.

You can book a call today and speak to a founder.

Have more questions? Check out our YouTube page for ways to get smarter with your money.

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Frequently Asked Questions

Here are some answers to questions received regarding athletes and money:

1.  How does Moment help draft picks prepare for the MLB draft?

   
   

   Our focus is on educating families around signing bonus structures, amounts, tax planning, and everything that goes into actually signing your MLB draft contract.

   
   

2. What is the biggest tax mistake you see with professional athletes?

   
   

   The biggest mistake we see is not planning in advance. There is a big difference between tax planning and tax preparation.

   
   

3. How does Moment work with CPA firms?

   
   

   We work hand in hand with CPA firms that specialize in professional athletes. This way our clients are getting specific advice regarding their tax planning moves.

   
   

4. What is unique about tax planning for professional athletes?

   
   

   The short earning arc, multi-state taxation, and income fluctuations provide athletes with circumstances often unique to them. We must account for all of these factors when looking at tax planning for professional athletes.

   
   

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*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.