Imagine this: you like your job and you make a pretty good living. You do a great job, you’re in no danger of being fired, you have worked for the same guy for over 22 years, and he’s a great boss. But you were just offered a lateral move to a different company at almost double the money. You don’t know a thing about the boss, and he (and/or you) could get fired at any time if you don’t do a good job. Do you take that new position?
That’s the choice that Bud Foster faced a few weeks back. Foster makes $400,000 a year working for Frank Beamer as Virginia Tech’s defensive coordinator, but Georgia was courting him for a rumored $750,000 a year to be their DC.
More money, less stability, and an unknown boss and working environment. Tough choice. That extra $300k+ a year must have been really tempting.
By now, you know what happened: Virginia Tech signed an addendum to Foster’s contract that would pay the coach a lump sum (an annuity) if he stayed with the Hokies for five more years. But the amount of the annuity wasn’t revealed at first.
Speculation ensued. How much was VT offering to keep Bud Foster in Blacksburg?
$750k times five years is $3.75 million. $400k times five years is $2 million. The difference is $1.75 million. How close to that did VT have to get in order to keep Bud Foster?
The Tech athletic department revealed the answer late Thursday. The amount of Foster’s annuity? $800,000.
The numbers reveal why I don’t negotiate contracts for a living; namely, I wouldn’t be very good at it. I figured that the number associated with Foster’s annuity was somewhere in the $1.0-$1.2 million range, so the fact that Jim Weaver (I assume) was negotiating this contract instead of me saved Virginia Tech $200k-$400k.
But the disparity between Georgia’s offer of an extra $1.75 million and Virginia Tech’s offer of $800k puts a solid price tag on the value of stability and a good working environment for a football coach. That price tag for Bud Foster is about a million dollars. Bud weighed the risks of going to Georgia with the rewards of staying at Virginia Tech, and knowing that he’ll be doing the same job for the same guy five years from now was worth a million bucks to him. That’s what he potentially gave up by staying in Blacksburg instead of going to Athens.
Bud Foster likes the bird in the hand more than the two in the bush.
When you’re talking about numbers like these, though, the perspective is different. For most of us, $400,000 a year is crazy money. Increasing it to somewhere between $560k (VT) and $750k (UGA) still leaves it squarely in the realm of crazy money. How much do you need, really? Answer: a lot less than $400k. Once you get to that level, you’re just playing with Monopoly money.
My point is, since I don’t make that kind of money (never have, never will), and most of you reading this don’t either, we can’t really look into Foster’s head and figure out what he was thinking.
But just based on numbers alone, Bud Foster felt that working in Blacksburg for Frank Beamer was worth giving up an extra million in income. When Bud is retired and kicking back on Claytor Lake a couple decades from now, I sincerely doubt he’ll rue the day he stayed in Blacksburg and didn’t go to Athens. More than likely, he’ll reflect on it as a decision well made.