6 figures just to change numbers.
Why do athletes end up broke?
- Thread starter Glenn's Take
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Usually comes down to bad friends, bad representation. Rarely a guy just over splurged that went broke.
People who literally become millionaires overnight many times don't have a good record of financial success.
I wish I remembered his name, but about 15 years ago, I read about a Cincinnati Bengals player stating he bought a nice $300K house because he knew the money wouldn’t last forever and wanted to always have a home.
Smart dude.
Smart dude.
People that make $100,000 dollars a year make it for more than an average of 4 years.
I remember Rod Smith, WR for the Broncos years ago, saying he lived in a $200,000 house and was banking every other penny he made. I bet he is doing OK now.
Probably same reason most lottery winners go broke too
That may have been him. It’s been so long ago. I heard them talking about it on a sports show when doing yard work, so definitely could’ve gotten teams mixed up
If it holds no value it is stupid. Doing stuff like that multiple times is why people can't retain wealth.
That said, it's his money. He can.do whatever he wants with it.
There was a documentary about how some pro athletes making big salaries go bust, some even become homeless. In a nutshell it's not having a plan. One guy signed a big multimillion dollar contract first thing bought a big house for momma, a big house for himself, brother, sister uncle likewise, cars, bling bling, at the time he was cut from the team a couple of years later he was paying on 7 mortgages. He declared bankruptcy.
The smart thing to do is hook up with an HONEST competent, certified financial planner and come up with a long term plan, develop a budget and live on it. You can have all the nice things you might want and still manager your finances so you won't wind up broke.
The smart thing to do is hook up with an HONEST competent, certified financial planner and come up with a long term plan, develop a budget and live on it. You can have all the nice things you might want and still manager your finances so you won't wind up broke.
Except for the example in the OP, it’s probably women who are the cause of a lot of it.
I was watching a former pro football player lecture young players on money management and he was talking about all the hangers on. He signed a contract for like 1.4 million that was reported in the press but he said when he got cut he wound up only seeing 20k of that money. If you fail to plan for your tax liabilities and try to keep up a large group of people your money is going to go fast no matter how much you make. When you have so much overwhelming overhead then even somebody with an unimaginable income like Michael Jackson can run into problems. Mike Tyson went through so much it should have been a crime.
I want to see Floyd Mayweather in 20 years. He'll be my greeter at Walmart.
I want to see Floyd Mayweather in 20 years. He'll be my greeter at Walmart.
Many football and basketball players come from family backgrounds with little to no wealth and little to no education. Give someone like that a few million at age 20 and it is no wonder that so many end up busted. Something like 50% of all NFL players are bankrupt within five years of retirement (maybe a fake news stat, but I think I read that it was some amazing percentage)
That being said, you can't out earn bad spending habits, there are plenty of people with education and from good backgrounds making good money that can't write you a check for $2500, Rich Man Poor Man (I think that is the name of the book) is a great read about that very issue, why so many with essentially the same job end up so drastically different in terms of wealth.
That being said, you can't out earn bad spending habits, there are plenty of people with education and from good backgrounds making good money that can't write you a check for $2500, Rich Man Poor Man (I think that is the name of the book) is a great read about that very issue, why so many with essentially the same job end up so drastically different in terms of wealth.
Let’s see- most from a culture of hanger-ons and handlers where they have grown up seeing rappers act like they have the pockets of Zuckerberg. Add in hoes who are looking to get a baby to have a paycheck for 18 years? Not good.
You give someone like that millions of dollars overnight who has no education and no real guidance and it’s not going to end up well.
The main issue is these guys have major egos and a belief system they’re going to be a star and the money is just going to keep rolling. For football players, no way should you bank on anything.
You give someone like that millions of dollars overnight who has no education and no real guidance and it’s not going to end up well.
The main issue is these guys have major egos and a belief system they’re going to be a star and the money is just going to keep rolling. For football players, no way should you bank on anything.
Absolutely. I've worked around and with people who have made anywhere from $80K to $200K+ that would have been one missed paycheck from having their utilities shut off. The vast majority of them are college educated people who are competent at their jobs, but for whatever reason(s), remain financially challenged.
Although professional athletes are susceptible to going broke due to poor financial management and frivolous spending, I do not see this example involving Jaylon Smith as one of those.
He is using the money to buy all the remaining inventory of his jerseys and shirts with the old number. If all these jerseys were being disposed, or he was just paying a fee, or paying somebody else for the permission to switch numbers, then that would be frivolous. But he's actually walking away with a product that has intrinsic value: clothing.
Perhaps now he can autograph it and have it either auctioned/sold, or he can donate it for a tax deduction. I don't know if he has to buy it all at retail price or cost, but he can deduct it for fair market value. If he can get it all at cost, then it's possible that a third-party will place a higher fair market value on it, which would result in a higher deduction amount that than actual amount of money spent.
He is using the money to buy all the remaining inventory of his jerseys and shirts with the old number. If all these jerseys were being disposed, or he was just paying a fee, or paying somebody else for the permission to switch numbers, then that would be frivolous. But he's actually walking away with a product that has intrinsic value: clothing.
Perhaps now he can autograph it and have it either auctioned/sold, or he can donate it for a tax deduction. I don't know if he has to buy it all at retail price or cost, but he can deduct it for fair market value. If he can get it all at cost, then it's possible that a third-party will place a higher fair market value on it, which would result in a higher deduction amount that than actual amount of money spent.
There's a reason Financial Advisors like myself exist.
A lot of broke athletes spend their rookie contract like it's gonna last 20 years. Then whoops they get cut after year 4 and end up in the G League.
You must work with my sister in law, GD, never seen a human being spend money like she does, and is often cash strapped, for no reason at all.
Also worked with a top attorney years ago who was the main cog in the whole firm, whose personal money management, or lack thereof, became a real problem for all the rest of us and eventually the firm broke apart. His kids were at very expensive private schools, leased (not purchased) the biggest most expensive Mercedes there was, lived in a huge home in a neighborhood anyone from Lexington would love to live in . . . and never had a dime to spare, literally was pounding on the office manager to make extra distributions so he could make his payments.
And spend like he's gonna make that money for 40 years, unfortunately.
Exactly. Not long back, one of my best friends' parents won about 10K, and less than a month later they'd blown it all on absolute garbage and were asking to borrow money from him. XD
Boats and hoes. Cmon guys. The answer is always boats and hoes.
On the other hand, I've known people that hardly work and somehow always have money. That drives me insane.
With that ridiculous outfit, if he didn’t play for Kentucky, every poster on this board would be calling him an idiot.
In many cases it's ex wives and a lot of child support. Plus most of these guys don't realize that taxes and agents fees get more than than half of their paychecks. Finally, they make bad investments like bars and restaurants which are very prone to failure.
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For the mega million athletes that end up broke? I would say lack of education when it comes to money and how to manage it. JMO though.