Is There Life After Football? Read Free Page B

income (median: $65,000). Other sources of “labor” income include bonuses or commissions, professional practices, endorsements, and business. About a third of former players have some sort of business income. Surprisingly only around ten percent of NFL alumni make money from endorsements, and those amounts are relatively small (the median is less than $10,000). The study does not indicate how many players have no income at all, nor does it report data on players’ current total wealth.
Benefits
    While the current NFL benefits package is extensive, if not comprehensive, this hasn’t always been the case. Alumni from earlier eras received only a small fraction of what’s presently available. NFLCommunications.com and other NFL sources specify the following benefits. 2
    Severance Pay
    Under the severance pay plan, a released player with two or more credited seasons in the NFL receives termination pay of $12,500 per credited season. A season is “credited” if the player is on (1) the active roster, (2) the inactive list, (3) injured reserve, or (4) the physically unable to perform list for at least three regular season or postseason games. A nine-year veteran such as George Koonce, for example, would be due $112,500 upon filing for retirement.
    Bert Bell/Pete Rozelle Retirement Plan
    The retirement plan provides both pension and disability benefits. Under the latest CBA, to be eligible (i.e., vested), a player must be credited with being an active player for (1) five credited seasons if he played before 1973, or (2) four credited seasons if any of his seasons were after 1973,or (3) three credited seasons if any of them was after 1992. At the age of 55, vested players receive monthly pensions based on years in service, not based on earnings in the league. The amounts differ according to the credited seasons played. Alumni are given $250 per month for each year played before 1982, $255 per season for 1982–1992, $265 per season for 1993–1994, $315 per season for 1995–1996, $365 per season for 1997, and $470 per season for years since 1998. For example, George Koonce started his nine-year career in 1992. His monthly pension payment would be calculated as follows: (1992) $255 + (1993) $265 + (1994) $265 + (1995) $315 + (1996) $315 + (1997) $365 + (1998) ($470) + (1999) $470 + (2000) $470 = $3,190 monthly payment for life ($38,280 annually at age 55). In comparison, the occasional player such as Brett Favre, a recently retired veteran of 20 years, will pull down nearly $100,000 annually when he reaches age 55. Players may elect to receive pension checks as early as age 45, but the monthly payments are substantially reduced. If players elect to defer payments until age 65, the monthly checks are substantially larger.
    Second Career Plan (401[k] Savings Plan)
    Rookie players may contribute to the 401(k) plan, but only players with at least two credited seasons get matching contributions. A player with at least two credited seasons in the league can contribute up to a maximum of $10,000 in pretax dollars per year and receive a matching team contribution of $2 for each $1 the player contributes.
    Player Annuity Program
    This program provides tax-deferred earnings on contributions made by NFL teams. NFL contributions are $5,000 for each of a player’s second and third credited seasons, $55,000 for his fourth credited season, and $65,000 for each credited season thereafter.
    Health Insurance
    The NFL provides continued health care coverage to vested players and their families
for five years
after leaving the league. Medical insurance covers100 percent of all in-network medical costs for a player and his dependents. The annual deductible for medical insurance is $400 per player and $800 per family with a lifetime maximum benefit of up to $2.5 million. Dental insurance covers 100 percent of all preventive dental care along with 85 percent of general services and 50 percent of major services. The