damnn that is a high rate, 60%. My profession is in finance/accounting, if i had the salary of what the least paid player in any of those leagues had for just a few seasons, i would be rich beyond my dreams and set for life cuz i would know how to use it lol. I dont know whether to chuckle at them or get sad...but ya, good read.
Great read. Made me wonder about myself in that situation too. I like to think that I'd handle all of my own finances, like I do today. But with the hectic traveling schedule and constant demands on their times, pro athletes can't review every bill and statement (like I currently do) and make their own payments. I can do this because I work in front of a computer for 8-12 hours a day. Pro athletes do not. I figure that if I was in their shoes - I'd have to trust a financial adviser to handle all of my finances too. And it seems like you can't trust anyone these days. My question is - why not ask the owner of your team (a billionaire) for some advice on good investment firms - though, like i said, you really can't trust anyone anymore.
Minimum NFL salary for 2008 was $295,000. Do you really think you could be "rich beyond your wildest dreams and set for life" on $295,000 (before taxes) a year for a few years?
It appears that the long and short of the article is that many (most?) of the athletes that go broke are either a) suckers b) stupid c) a terrible combination of both
Good read. I wonder why players unions can't do more to help educate and advise athletes to avoid so many of these pitfalls. But it still comes down to the athletes themselves making poor decisions.
You're right. it really does. I mean, when you read that Travis Henry attended the NFL Rookie Symposium, sat in the discussion about how some women are looking for a payday, and still went on to father a ton of children with different women - it makes you realize no matter how much any of the unions do - it really is up to the athlete at the end of the day. I have a feeling that most of the 22-year-olds attending these classes are half asleep. Perhaps they should have some kind of "continuing education" - even after the rookie season - once these players start to come across the trappings of their fame and fortune. Perhaps then the messages will strike more of a nerve.
One piece of simple advice that I'd give to athletes who insist on hiring their friends as handlers would be to set up an annual external audit of all their financial dealings (and have one done after the first 3 months and 6 months of their relationship with their handlers). This should catch any funny-business early enough to prevent them from being cleaned out (of course, this assumes they would actually pay attention to the advice of the auditors, which may not be a given based on what the article suggests). The other thing I wish everyone got was a better economic/financial education in high school (actually, it would be best to start in late elementary and junior high school). In particular, everyone needs to understand that designer clothing, jewelry and custom cars are essentially worthless after 5 years due to depreciation.
This is absolutely true. When I was in my late 20s and making more money than I ever imagined - I, too, spent it on stupid stuff. Expensive cars, rims, designer clothes, watches, vegas spending sprees, and any and everything under the sun that was a depreciable asset. I look back on that time and wonder - "what the hell was i thinking?" And I'm a college-educated man who likes to think he is smarter than that. I started making that money with no understanding of economics/finances. It took years for me to start thinking wisely and to stop the foolish spending. I think some formal economics/financial classes in college or high school probably would have better prepared me for my life.
its easy to call these guys stupid and suckers but really, giving some 20 something year old with limited education education a bunch of money is a recipe for disaster. Youth is a major a factor alone. what does a twenty year old no about a business venture and why wouldn't they trust their family.
I was not trying to be unsympathetic. Call it what you want: Youth tend to be stupid and suckers. It is what it is.
And not to mention they have tons of spare time between games and seasons and there are so much tempatation out there.
There must be a lot of peer pressure to get a baller car, baller house, and baller clothes the first time you step into a locker room. The problem is you get your first fat check, then you think the sky's the limit. But then consider your retirement (which could start from the 30's to 40's depending on the sport), not to mention the possibility that you may be out of the league much sooner than you think. Isn't the NFL average career like 3 years? You should really be saving a lot of money up front, instead of the other way around. Pragmatically, that early money should be budgeted for the next 30-40 years instead of next season, because anything can go wrong.
I didn't read the whole thing yet, but... I imagine this has a lot to do with the fact that nearly all pro athletes were stars in high school, got full-rides to play sports in college, and then come out and get drafted and start making all of this money without ever having to live on a budget or manage their money properly. They've never even had a full-time job before and had to pay all the bills, so of course they're not going to know how to spend/save money.
You've got 8-10 years in most cases to make money to last you 60. Most players (and really, most fans) don't comprehend the economic realities these guys have. Most just say they're millionaires, so they most be rich and set for life. But let's say we've got a guy that averages $5M/year for 10 seasons. That should be the NBA's version of "Middle Class". We'll further assume he's smart enough to live in either Florida or Texas. His actually take home each, minus taxes (federal, plus state taxes for all away games) and minus his agent fees is going to be somewhere between $2M and $2.5M. That's a little less than $25M take home for his career, not including endorsements. THAT then translates to about $400k per year to live off of, without adjusting for inflation. And athletes do have higher living expenses, without involving luxury. They do need gated communities so they aren't hounded. They are almost always providers for their parents and siblings to some extent. But yes, there's still enough that they could live comfortably for life on what they make. But they don't do that simple math to start with. Scottie Pippen made about double what I listed in my example for his career. That's nice and all, but to think he could afford a private plane on that was stupid. Evan
