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LeBron James informed the Miami Heat that he is opting out of his contract that would pay him $20.6 million next season, meaning he will become a free agent on July 1.

So now that he will have his choice of teams, where will James end up? Here are his best options:

Miami Heat

They are the top option for a variety of reasons. The Heat can offer James the longest and most lucrative contract. If Chris Bosh and Dwyane Wade return, that's still a pretty good core. He has won two championships with the Heat and more are possible if the Heat make the right roster improvements. It's Miami. He and his family like it there. The Heat should be front-runners.

Chicago Bulls

If the Bulls are interested in Carmelo Anthony, why not James? Chicago met with James in 2010, and a core of James, Derrick Rose and Joakim Noah would be outstanding. But the Bulls would have to amnesty forward Carlos Boozer, trade Mike Dunleavy, trade one of their two first-round draft picks, eliminate some non-guaranteed contracts to free up the cap space to offer James an enticing contract.

Houston Rockets

General manager Daryl Morey is a dreamer and a dealer, and it will take a good dose of both for the Rockets to sign James. It starts with convincing James that he, Dwight Howard and James Harden can play together — offensive and defensively — then Morey needs to create salary cap space, and that means trading Omer Asik and Jeremy Lin.

Cleveland Cavaliers

The Cavs are always going to get mentioned because of the possibility James returns to his hometown team and erases the bad feelings from his 2010 departure. But winning titles sooner rather than later still remains at the top of James' priority list, and the Cavs are not championship-ready now. A first-year coach (David Blatt) with no previous NBA experience and a first-year GM (David Griffin) aren't strong selling points.

Los Angeles Lakers

The big question here: Is Kobe Bryant willing to cede control to James? Can you see Bryant doing so? But there's no question the Lakers believe it can work and will do everything they can to convince James they are the team for him — with Bryant and without Bryant down the road. The Lakers have the money to sign James, and will have money for another top-notch player either this offseason (if Steve Nash retires) or maybe even next offseason. But, like the Heat, can the Lakers add enough quality players around James to compete for a championship?

Los Angeles Clippers

James, Chris Paul and Blake Griffin would automatically make the Clippers favorites to win the Western Conference. But like Houston, the Clippers would need to make a series of moves, including a sign-and-trade, to get James from one coast to the other. Doc Rivers would love to coach James, and James has strong respect for Rivers' Celtics teams. But there remains that pesky little Donald Sterling issue. There's no guarantee that situation is resolved by the time James needs to make his choice, and his direct comments about Sterling not belonging in the NBA would make it difficult for James to go to the Clippers as long as Sterling still owned the team — even if he has no control of the team.

Phoenix Suns

It's a long shot, but point guard Eric Bledsoe and James share the same agent (James' longtime friend Rich Paul), and the Suns are a promising team. They won 48 games last season in the ultra-competitive West when many expected them to tank. They have a solid coach (Jeff Hornacek) and a talented and young roster (Bledsoe, Goran Dragic, Markief and Marcus Morris, Gerald Green and Miles Plumlee). With the right additions, the Suns could be appealing to James, at least enough for him to hear their pitch.

VIDEO: For LeBron, 'the league is his oyster'

USA TODAY Sports' Sam Amick explains why it's good right now to be LeBron James after he opted out of his contract with the Heat.

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