The Yankees are entering the 2025 season with a luxury tax payroll of $303 million, officially surpassing the final $301 million threshold. While the team continues to invest heavily in its roster, a notable portion of their spending is tied up in players who will not be contributing on the field this season. This financial inefficiency has become a hurdle as they look to maximize their resources and contend for a championship.
Paying for Aaron Hicks’ Departure
A solid chunk of the Yankees’ payroll is still allocated to Aaron Hicks, who is no longer with the team but remains on the books. Hicks is set to earn just under $10 million in 2025, even though he hasn’t played for the Yankees since being released during the 2023 season. His contract runs through 2026, although the Yankees will owe him just $1 million for the final year of his deal due to a buyout clause.
Hicks’ lingering financial impact has been a source of frustration for a team already operating at the top of the payroll spectrum. The extra moves the Yankees want to make are held back by bad contracts like this — throw DJ LeMahieu into the mix as well while we’re at it.
Anthony Rizzo’s $6 Million Buyout
The Yankees also paid a $6 million buyout to Anthony Rizzo after declining his $17 million club option for 2025. Rizzo, who had been a staple in the Yankees’ lineup for the past few years, experienced a steep decline in 2024.
In 96 games, Rizzo slashed .228/.301/.335 with 8 home runs and 35 runs batted in, registering an 84 wRC+. His production, both at the plate and defensively, fell well below expectations, leading the Yankees to explore other options at first base.
Goldschmidt: An Immediate Upgrade
Instead of bringing back Rizzo, the Yankees pivoted by signing Paul Goldschmidt to a one-year, $12.5 million deal. Goldschmidt, while not at his peak, represents a clear upgrade over Rizzo. In 2024, the 37-year-old played 145 games for the Cardinals, slashing .245/.302/.414 with 22 home runs and 65 runs batted in. His 100 wRC+ suggests he was a league-average hitter, but even in a down year, Goldschmidt outperformed Rizzo in almost every offensive category.
Defensively, Goldschmidt continues to provide value at first base, where he has long been regarded as one of the better fielders in the game. His steady glove and improved offensive profile give the Yankees a more reliable presence at the position, something they lacked with Rizzo’s inconsistency last season.
Future Financial Flexibility
While the Yankees’ current payroll constraints are evident, the upcoming expiration of these financial commitments could provide some relief. Hicks’ contract will mostly come off the books in 2026, and the buyout money allocated to Rizzo is also one and done. This opens the door for the Yankees to be more aggressive in free agency next off-season forward, with an estimated $16 million freed up from these two players alone.
Having that money available should allow the Yankees to reinvest in other areas, whether it’s retaining key players, pursuing top-tier free agents, or adding depth to their roster. While the immediate financial impact of these contracts is frustrating, the light at the end of the tunnel will position the Yankees to maintain their competitive edge in the coming years.
