In an exclusive frank and revealing interview with WLR'S Eamon Keane the Del La Salle man revealed the emotional moment he told his players of his decision.
The 42-year-old announced his decision to his panel after their final game this season against Cork in Semple Stadium.
Conscious that his decision would not clash with Michael Brick Walsh making history by making his 74th Hurling Championship appearance.
Father-figure McGrath said he made his "emotional" announcement during players gathering in the Horse and Jockey last Sunday evening.
"We went into our normal meeting room at the horse and Jockey and I told them that after much consideration that I was stepping away after five years at the helm."
Feeling "guilt-laden" of his decision he asked his "unified" players to respect his decision.
"I hugged each and every one of them and thanked them from the bottom of my heart for what they have done for me, Waterford and my own family."
Looking back on Tipperary's 'Ghost Goal' the manager who remained very sanguine and composed during the game that may have been the Championship ending decision for Waterford believes that all aspects of decision-making need to be analysed.
"It was almost made kind of; I'll give this goal because if I don't give it, they will show it on 'The Sunday Game' that it was a goal, it almost a spur of the moment.
"I better give this because it might be a goal and I think when it's might you can't give it."
The former Waterford boss feels he is "saturated" in what he has given and needs to time to recharge and it was his own decision to step down.
He described his wife as unbelievably supportive during his five years in charge of the Waterford team.
Derek who is a family man and likes nothing better than being out and about with the kids and believes he needs time to recharge after leading Waterford for five years.
"I am burnt out because of the expectations I place on myself as opposed to anything else."
"For me, my greatest relationship is with the players and I felt I owed them another year of giving everything we can and I told them that in the sweep last year on the 29th of September and said we will just give it everything we can."
The English teacher from Del La Salle College Waterford said he loves teaching and is looking forward to returning to the classroom but would not rule out or going back or returning to management in the future.
https://soundcloud.com/wlrfmwaterford/deise-today-tuesday-19th-june-2018
