16% of retired NFL players go bankrupt, a report says

Fortune ^ | 04/15/2015 | Daniel Roberts

[PGR88]

Surprised the number is so low.

Indeed. ONLY 16%? Perhaps its a narrow definition of those who literally file for bankruptcy protection. I would assume its closer to 50% who wind up spending every cent they ever made

[norwaypinesavage]

A million dollars seems like a LOT of money. Most of us will never have a million dollars at one time. BUT....if you obtain a million dollars at age 22 and want it to last a lifetime, the most you can take in any one year is $40,000. (And with today's interest rates, it's a lot lower than that.)

Now, $40 K a year is good money, especially if you have another job, but it's hardly a life changing sum. You can't buy expensive cars, big houses, recreational drugs, and expensive dinners out for the rest of your life on it. Yet, it seems like that's what most NFL players become known for. I'm surprised the number is as low as stated in the article.

[RobinOfKingston]

There was a saying when I was a kid ... “easy come, easy go”.

[norwaypinesavage]

Welcome to this Obamanation. Thanks for your help.

[Svartalfiar]

Nice find. Some stuff from the article:

And tells stories about players who know very little about bank accounts or credit cards and, for example, take their first huge paycheck to a check-cashing place.

Why would you do that? If you take it to your bank, they'll cash it for free! How are people not aware of that? I don't know anyone much past freshman year of high school who doesn't have some kind of checking/savings account.

Know the difference between ‘need’ and ‘want’ when people ask you for money.... “I finally learned how to cope with this type of request. I paid the bills directly to the company or handyman doing the work. It was amazing to see how my family responded when I told them I would take care of it.”

Yea, you can be a good family member/friend and help out. But I'm sure, in his case, this direct-payment method likely cut the requests in half. at least.

Sad that so many people have no shame and are willing to just ask someone for money. Sigh. My roommate's in his late 20s and has made 6 figures for the past couple years. The only time I don't pay for stuff is sometimes if he wants to go to a really expensive place for dinner or something and he offers to pay. I would never just ask him for free money...

[driftless2]

I remember reading the words of a defense lawyer for a Packer player accused of assault about twenty years ago. Although he made about half a million a year, the public was surprised to discover that the player's mother was still on welfare. He'd given his mother very little of what he earned.

The lawyer responding to the criticism of the player for not giving his mother enough to get off welfare said the general public knew very little of the spending habits of pro players. He said a great many of them spent every last penny they earned as soon as they got their money. No thought for tomorrow much less when they retired.

[discostu]

That’s an improvement from the last wave of numbers. Used to be around 30% in 5 years, half that in more than twice as long would seem to indicate their rookie symposiums on how to manage their money and life could be having an effect.

[Hoffer Rand]

I think I remember Dave Ramsey saying he was involved in this.

[ken5050]

Thought you might enjoy this...a few years ago we had a serious discussion in my parish as to if it was a good thing to give money to those begging/panhandling..usually for food on street corners..some felt that even thought the money was likely going to drugs/alcohol..it was still somehow our obligation to give. I never give to beggars..I donate to food pantries and the like. Our priest suggested this experiment..as they’re mostly found at major intersections..maximum traffic...and there is almost always a fast food place on one or more corners..he said don’t give them money..but tell them to meet you at, say, the McD..and you’ll buy them a meal, and talk to them while they eat and see if you can help....he gave us print outs of all the social service and outreach agencies for the homeless in the area..I did it for 30 days...and kept score..I made the offer to 83 men, 28 women...10 men accepted...12 women did..I think I might have helped a few of the 22 I met with..gave them info on shelters..and money for bus fare..but overall it shows you that the vast majority aren’t really “hungry”..at least NOT for food..

[driftless2]

"class...managing money"

They should also have to take a class by senior year of hs about free-market economics and how it has benefited the world and made America great.

[Grams A]

Amen. I could foresee a big problem though in that there would not be enough people available who could teach the needed courses. I took a course several years ago at one of our local junior colleges on economics. Taught by a Vietnamese fellow who had taken $25 given to him by his parents when he was a teen and turned it into a substantial amount of money by bottling and selling orange juice. Best teacher I ever had and certainly a whole lot better than any I had through my 6 years of college. Interestingly this instructor did not have a college degree of any kind so he would not be permitted to teach in the public school system. Life’s lessons are often the best teachers.

[RayChuang88]

That's why the best players have supplemental income from endorsements and money managers that invest most of the salary earnings. It's not a coincidence that both Tom Brady and Peyton Manning are now worth hundreds of millions of dollars. And Peyton Manning is ready to move from the sidelines to the NFL front office in just about a blink of an eye.

[Figment]

N***er rich