LeBron James is the wealthiest active basketball player in the world.
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King James has been part of the NBA since 2003 and his status as one of the best players has earned him a hefty sum in salary. His popularity has also gotten him incredible sponsorship deals. The above two combined with his investment portfolio have resulted in James attaining billionaire status.
The Boy from Akron made himself a superstar in the league and earned the riches associated with such status. LeBron’s dominance has been inspirational and has spanned decades.
Despite all his history in the league, LeBron James has never been part of a trade. The King has held complete control over his future at all times. His spell at Miami, his return to Cleveland, and his decision to join the Lakers were all free agency moves.
Among the non-basketball reasons to ponder a move, taxes have to be the most important criterion. LeBron James has made some interesting choices in that regard. This includes not changing residency while moving to the Heat to picking the exorbitant taxes of California.
Why did the move to the Lakers make less financial sense for LeBron James?
In 2018, as a free agent, LeBron James had the choice to move to any market in the NBA. Multiple teams had emptied cap space to acquire the King. Eventually, the King decided to adorn the purple and gold of the Lakers, who he represents to this day.
However, financial advisors criticized this move on various grounds. At Cleveland, the highest income tax rate that was payable was only at 4.9%. Such a figure plus the additional 2.5% local taxes associated with Akron still amounted to only a decent amount.
In comparison, California taxes demanded a payment rate of around 13.3% on bulk on LeBron’s $36 million salary. The King was projected to be paying an additional $21 million to make the move to LA.
With LeBron also reported to be paying a tax rate approximately 3 times higher than Steve Ballmer, jokes have surrounded how LeBron must change his tax advisors. The considerations and the additional sum payable to the state with his LA move further add to this narrative.
While the additional expense has resulted in him adding a ring to his collection, has it been worth it? The Lakers have been shrouded with drama and trade noise and the last couple of seasons have been disastrous. Did LeBron make an expensive mistake with his move?
