Posted on 04/16/2015 5:20:28 AM PDT by SeekAndFind
The stat comes from a new paper from the National Bureau of Economic Research.
It may be hard to believe that professional athletes, who earn so much money at such a young age, could possibly end up bankrupt. But nearly 16% of those in the National Football League do—just not right away.
According to a new working paper from the National Bureau of Economic Research (NBER), 15.7% of NFL players have filed for bankruptcy 12 years after they retired.
The paper, entitled “Bankruptcy Rates Among NFL Players with Short-Lived Income Spikes,” examines the traditional model of consumption smoothing (save money when income is high for later on, when income is low) in the context of athletes, who undergo what is really the opposite income path of most people. Athletes hit their earnings peak almost immediately after school, while young. Then they retire young, and in the vast majority of cases, never again earn at the same levels. Because of that model, it can be difficult for them to save. They are often taken advantage of financially, or simply haven’t had any guidance preparing for managing their money after retirement.
NFL players have an “income profile,” says a précis to the NBER paper, that “does not just gradually rise then fall, as it does for most workers, but rather has a very large spike lasting only a few years.” The paper uses data on all players drafted to NFL teams from 1996 to 2003. The data finds that bankruptcy filings begin “very soon after retirement” (but just 1.9% of retirees have filed after two years) and “continue at a substantial rate through at least the first 12 years of retirement.”
(Excerpt) Read more at fortune.com ...
WHO CARES?
Surprised the number is so low.
ATleastt they’re better off than Arron Hernandez.
I do... I think there are lessons to be learns from others mistakes and the consequences they suffer.
Every child in America should be required to take a class on managing money, saving, compounding interest, living below your means, ect.
We must help them transition back to the good life. Those poor unfortunate souls.
I would guess that the NFL has a “save your money” lecture as part of their “Welcome to the NFL” orientation. Unfortunately, few young men are likely to listen.
But how do they feel about The War on Gay Marriages?
These guys DO go through a course from the NFL on managing money, etc. The NFL is actually pretty concerned about it, as it should be.
Based on the trajectory of public education, you wouldn’t like what was taught.
Agreed. Add to that how to balance a checkbook, make and keep a budget, etc.
Probably look like Jim Rogers compared to pro boxers.
It means at least 84% aren’t finished idiots!
% compared to Lottery winners?
“Nouveau riche” syndrome?
When you get paid 400,000/month, you should buy what ever car you want. However, you should also put a little bit back.
Because of their very unique earnings profile, these guys should be encouraged to pay for everything with cash and carry no debt. Since unlike most people they will earns tons and then next to nothing with little or no warning.
Cars, bling, and teeth ain’t cheap.
I think I read a statistic somewhere that estimated 1 in 6 Americans goes bankrupt at least once in their life.
That’s right at 16%.
Or a "posse".
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.