Father Time has never been defeated, and there will always be a point in an athlete’s life where they had to retire. In basketball, hanging up the sneakers is an inevitable end to every career. But have you ever wondered what do NBA players do after they retire? And even though they made millions during their playing career, how do retired athletes make money?
Let’s find out.
Do NBA Players Get Paid After They Retire?
NBA players could retire for many reasons. They could call it quits because of a career-ending injury, no teams are interested in their services, or just because they feel like it. What if a player retires in the middle of his contract because of injury? What happens?
First off, there is an official and a non-official retirement. An official or formal retirement is when a player sends a retirement letter to the league. Bison Dele, Kobe Bryant, Vince Carter, and many others went that route. Now, if a player officially retires when still under contract, he will forfeit the remaining balance of his contract.
But what if an injury forces a player under contract to quit? First, league-appointed physicians must examine the player to make sure that the injury is truly career-ending. If it is, the said player will be paid the remainder of his contract, but the medical insurance will shoulder 80% of it. The bitter part about the team is that the injured player’s salary still hits against the salary cap, although they can apply for a disabled player exception to replace him in the roster.
Another possible scenario is when a player wants to retire without an injury and is still under contract. The team may choose to pay him the rest of his contract, although that’s a rarity. Another unique scenario is when a player wants to be released, but the team doesn’t want to let him go. In that case, the only option is for that player to file for formal retirement, and he foregoes his remaining salary.
In any case of retirement, the player may return after one year to continue playing and resume his career.
Here’s another question: Do NBA players get a pension after retirement? Yes, they do! The league already has had a pension plan in place since 1965, but it had been significantly improved in 2017. The NBA Players Association led by Chris Paul, Caron Butler, and James Jones, all did their jobs to make it work.
Here are some revisions: If a player chooses to receive a pension at age 50, the pension increases by 50%. If a player elects to receive a pension at a later age, then the pension increases. On average, the former players earn $300 more.
Former NBA players may start receiving pensions at 45 years old, but of course, they receive less because they get paid over a more extended period of time. They should at least play three seasons to be eligible. They are also encouraged to receive payments later, preferably at 62 years of age.
To put things in perspective, a 62-year old, former 10-year NBA vet could get $215,000 per year as pension. A former NBA player with three years of experience could net almost $57,000 if he chooses to receive pensions at age 62.
Other benefits for retired NBA players are tuition reimbursement (up to $33,000 annually if one chooses to go back to school) and healthcare for life.
What Age Do Most NBA Players Retire?
The average age of NBA player retirement is from their mid to late 30s. Most of their physical abilities taper off after the players hit their prime at about 27 years of age. They could still get better in terms of skill and basketball IQ, but their speed, quickness, agility, and jumping ability begin to decline.
In some circumstances, a player may retire sooner because of accumulated injuries. Jonathan Bender was forced to retire at age 25 because of devastating knee injuries. Injuries also caused former All-Star and two-time NBA champion Andrew Bynum at age 26.
If you did not know, both Bender and Bynum are big men. Therefore, although studies do not officially back this up, positions could play a role in how a basketball player’s body breaks down during time. Power forwards and centers weigh the heaviest, so the pressure on their knees is more tremendous. On the other hand, guards are smaller, and their position does not require them to bang with the giants. Hence, they generally have longer careers.
Of the 21 oldest players to ever play in the NBA, 13 are either guards or small forwards.
How Much Do NBA Players Get When They Retire?
The NBA’s pension plans are already mentioned in the previous section, but here it is in a nutshell:
- To qualify, one must play in the NBA for at least three years.
- The pension amount depends on the year of service and the age at which one chooses to receive a pension.
- A retired player may receive a pension when he is at least 45 years old.
- The NBPA encourages the former players to opt-in to their pension at age 62.
- The minimum yearly pension for a 62-year old former NBA player is $56,998.
- The maximum NBA pension is $195,000 plus a league-sponsored 401 (k), putting the yearly total to $215,000.
- If a former NBA player goes back to college, he will be reimbursed for his tuition for up to $33,000 annually.
- Former NBA players get lifetime health insurance while the spouses and children of 10-year-plus vets get assistance.
What Do Most NBA Players Do After Retirement?
What NBA players do after retirement is entirely up to the passion of the individual. Kobe Bryant, for instance, built companies, and Michael Jordan also had some successful businesses. Magic Johnson dabbled into real estate and turned into a mogul, while Shaquille O’Neal also had a long list of business investments. Bryant, for one, actually won an Oscar in 2018 for Best Animated Short film.
In short, what do NBA players do after they retire? They choose to grow their portfolio by investing in businesses and pursuing their passions. However, there seems to be one thing in common for all these retired NBA players. What is that? It looks like they always return to basketball in some capacity.
Here are some examples:
- Kobe Bryant built the Mamba Sports Academy, which aims to develop youth sports programs including basketball, volleyball, etc.
- Michael Jordan currently owns the Charlotte Hornets.
- Magic Johnson once served as the Lakers’ president of basketball operations.
- Shaquille O’Neal, along with Charles Barkley and Kenny Smith, work at NBA on TNT.
- Kendrick Perkins, Ryan Hollins, Jalen Rose, Richard Jefferson, and many others work as basketball analysts for TV networks.
- Many NBA coaches were also former players such as Scott Brooks, Tyronn Lue, Nate McMillan, Doc Rivers, and Steve Kerr.
- Cherokee Parks works for the NBA headquarters in Manhattan, focusing on player development.
- Luc Longley is closely working with the Australian national basketball team.
- Patrick Ewing and Penny Hardaway are coaching for NCAA schools.
- Dikembe Mutombo is closely involved with NBA Africa.
- Yao Ming is also involved with basketball in China.
- JJ Redick, Matt Barnes, and Stephen Jackson host podcasts whose main topics are basketball-related.
Wrapping Things Up: What Do NBA Players Do After They Retire?
Most NBA players start to go pro when they are 19 or 20 years old. The average age of NBA player retirement is anywhere from 32-37. That means, between their starting years and their retirement, they earn millions of dollars playing a sport they love.
An NBA player could retire for various reasons, with health and injuries the most typical justification. If an NBA player calls it quotes because of injuries, he is still entitled to the rest of the amount of his contract with 80% shouldered by health insurance. If a player under contract simply decides to quit and the team does not let him, he may file a formal retirement to the league. He will forego his remaining salary and could return to the NBA after a year.
Now, what about the long-retired NBA players? Do they get a pension? Absolutely yes! In all fairness to the NBA and its players’ association, the pension plan is one of the most generous in sports. The pension amounts differ based on years of service and the age at which a player chooses to receive his pension.
To qualify, one must have played in the NBA for at least three years. A retired NBA player may receive pensions at 45 years old, but they are encouraged to forego the earliest options until 62. If a former NBA player with three years of NBA experience chooses to receive a pension at 62 years old, he gets a shade under $57,000 annually. Someone with over 10 years of experience could get over $200,000 in pension annually, the maximum NBA pension barring any changes in the future!
Still, many NBA players who invested their money wisely would not need the pension money. How do retired athletes make money? Some of them are already accomplished businessmen, and many enjoy some form of basketball-related employment such as coaching. Whatever the case may be, it seems like the league and the players association are looking out for the best interest of the former players in terms of income.