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What happens financially if Tom Brady retires from the NFL?

Will Tom Brady retire? While the world waits, there have also been reports of financial motivations for delaying the goodbye. Are they true?

Will Tom Brady retire? While the world waits, there have also been reports of financial motivations for delaying the goodbye. Are they true?

Amidst the intense speculation surrounding Tom Brady's possible retirement, there have also been some reports which suggest a less than pure reason for the delay in clarity from the legendary quarterback.

Some reports suggest Brady is waiting on payday

When news broke on Saturday that Tom Brady was retiring, news outlets became hives of activity as numerous pieces paying tribute to TB12 were churned out. Then later on that day those gears ground to a halt, as it was announced that Brady himself said he had not officially announced his retirement. To add an even greater sense of mystery, there have been reports from varying sources that suggest that Brady is waiting until February 4th, to officially hang up his boots because he is due $15 million in incentives. Is that true? As it turns out, no.

According to reports Brady is already guaranteed that money and in what essentially a 'plot twist' could be subject to a scenario wherein he is asked to payback the franchise, due to premature conclusion of his contract - Brady still has a year left on his deal. One can imagine, however, that should he actually follow through on his retirement, the Bucs won't do themselves any favors by asking the greatest QB in the history of the game to pay them back.

So what is Tom Brady's contractual situation?

Tom Brady is currently under contract through the 2022 season. By signing a one year extension last march for $27,941,176 he essentially freed up $19.3 million of 2021 salary cap room. His extension included three voiding/dummy contract years for the period of 2023 to 2025. What that means, is that his guaranteed $20 million fifth day of the 2021 league year roster bonus and $20 million signing bonus, could be prorated over five years - through 2025 - as opposed to over just two years - through 2022. What's the 'fifth day' mean? Brady is scheduled to make $10,395,588 in 2022 on a $20,270,588 cap number. The amount that he is set to receive consists of an injury guaranteed $8.925 million base salary that becomes fully guaranteed on the fifth day of the 2022 league year waiver period (Feb. 18) and a $1,470,588 17th regular season game roster bonus.

How does Tom Brady's retirement affect the Bucs?

In simple form, Brady's retirement would be a financial plus for the Buccaneers, as they would immediately have $32 million in 'dead money.' The term of course refers to a salary cap cost for a player who is no longer on a team's roster. In the case of Brady this would only be applicable if he retires before June 2nd. To be clear, that would be $11.8 million more than Brady's 2022 cap number, which means the aforementioned $8.925 million salary guarantee would be voided the moment he calls it quits.

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As things stand, Tampa Bay can't sustain an increased cap. with $189.992 million in 2022 cap commitments spread across 46 contracted players, the Bucs don't have any wiggle room. The 2022 salary cap is expected to sit at the $208.2 million ceiling the NFL and NFLPA agreed to last May. Once there are 51 players counting, Tampa Bay is projected to be $15.5 million under this ceiling. If one considers the numbers mentioned before, it's just not a feasible move.

What's the solution for Brady and the Bucs?

While it must be said that it is quite likely that Tom Brady will retire, it could be argued that there is a way in which it could be handled such that the Bucs avoid taking a hit. For example, if the Bucs were to wait until June 2nd to officially process Brady's retirement, they would actually be able to create a larger cap. The $24 million of bonus proration connected to the previously mentioned dummy contract years would become a salary cap charge rather than part of 2022's dead money - $8 million. The Buccaneers at that point would be eligible for $12,270,588 of 2022 cap room. For the moment, we can only wait and watch.