Contract Extensions - Last Minute Thoughts

I'd hoped to post a discussion of good and bad contracts that might have been signed last season to give some guidance but I both ran out of time and took a look at the list of salary increases/decreases and just froze on coming up with a ton of examples.

But - these players were the best to sign for a 2009 contract in 2008.

Tim Lincecum: 2008 Salary (and 2009 contract price): 1315; 2009: 6491; Savings: 5176
Cliff Lee: 2008: 1568; 2009: 5670; Savings: 4102
Josh Hamilton: 2008: 691; 2009: 4696; Savings: 4005
Rich Harden: 2008: 493; 2009: 4293; Savings: 3800

Now - it's doubtful that up until now Harden is living up to that high salary in the 2009 season, but it's a lot more tolerable if you bought his contract in 2008 for just 493.

Lincecum, by the way, is a great example of the possibilities of a 2-year contract.
2007 Salary: 100
2008 Salary: 1315
2009 Salary: 6491

In 2007, you would have paid 1500 for a contract covering 2008-09 (using the yearly minimums of 250 in year 1 and 1250 in year 2). If you had simply kept him on your roster without the extensions, you would have paid a total salary of 7806 for those 2 seasons. Using the 2-year contract, you just freed up 6306 over 2 seasons to spend on other players.

Beware, though...because there are always guys like Francisco Liriano. I spent 1500 in his rookie season for 2 years BEFORE he got injured (injury occurred at end of July 2006). 2006 Salary - 148 2007 Salary - 1883 2008 Salary - 694.

OK, so I paid 250 for the 2007 season and it looks like I saved a lot of money. But he sat out the whole season recovering from Tommy John surgery. And the 1250 I spent on the second year of the contract went toward the actual salary of 694.

Couple other points: Again - don't sign Stephen Strasburg or Dustin Ackley yet - or anyone else until they hit their first season of major playing time. And I'd also suggest that don't simply look for cost savings in a salary that will increase. Make sure that you think you really want that player on your roster next year, because you've got to keep him in the carry over period.

Good luck