Athletes and money

In the media, we often see how the mighty have fallen. OJ Simpson was force by circumstances to rob back some old sports memorabilia he once owned. Former NFL players are living on pittance because of a poor pension plan in the NFL. Michael Vick was taken advantage of by nearly everyone and is now being forced to sell everything. Evander Holyfield's house is being foreclosed or already has been foreclosed. Latrell Sprewell melted down when his 11 million dollar salary couldnt pay to feed his kids, after already making 50 million in the 5 previous seasons. He turned down a 10 million dollar a year for 3 years contract extension because it was insulting. I dont know about you but not many people that I know of would turn down a 10 million dollar a year contract. The list is endless and includes athletes in all forms of sports and all levels of skill. Dorthy Hamill, Mike Tyson, and even football god Johnny Unitas all filed for bankruptcy.  What seems to be the common theme running through athletics? The common theme is that athletes mismanage money and treat the money they have at that time as a infinite resource. 

A good athlete's career, in many sports, doesn't continue too far past 35 or 40. This presents the biggest problem for all athletes financially. The income you have during your 10 year career, or however long of career you have, is only going to keep coming in during the time you play. Once you are done playing, in most likelihood, you are done making money. That money you made during your career then needs to last the remaining 40+ years of your life. How many athletes do we see though, that choose to invest in 401ks or other retirement plans. Athletes tend to live in a here and now type bubble. They spend what they have now and don't really look forward to plan for when their income will stop. In many cases, injury can shorten a career and possible cost an athlete millions in lost potential income. Athletes invest millions in cars, houses, clothes, and other luxurious items.

Athletes like Vick are also at risk for being taken advantage of by others. Most athletes did not come from wealthy backgrounds or have had any experience dealing with money. They need help to manage their finances, but do not know what to look for in that person who will ultimately help them. When friends, relatives, and acquaintances all begin asking for money, often these starstudded athletes do not know any better then to just keep saying yes.

This brings me to my main point, why don't profession sport leagues provide players with financial planners? They offer career planners and they offer everything from doctors to security. Now many leagues do offer optional financial planning sessions, but it doesn't do enough to help the situation. If you teach a kid about safe sex by providing an optional session, the desired result probably won't be too successful. Now if you instead change it to a class over a semester or a year or what not, studies have shown how much more successful the later is. Now you cannot just do the same in sports and provide single optional seminars. Financial security is just as important as publicity and the leagues should screen and supply financial planners (consultants) for the athletes. Its the only way to ensure that no one is being taken advantage of by consultants just looking to steal some money away or doesn't know what they are doing. These pension problems and health care problems can be solve the same way a wealthy business person would, with a financial advisor and savings for the future. I don't want to look at athletes that have blown tens of millions of dollars and feel bad for them being in bankruptcy because they cannot manage money the same way that hundreds of millions of Americans do each day.