I decided to watch a documentary on how professional athletes handle their finances and if, in fact, they go through the same troubles as the average American.
After watching the ESPN Films: 30 for 30 documentary, “Broke.” I was astounded that 60 percent of former NBA players are broke after just five years of retirement. In addition, after just two years of retirement 78 percent of former NFL players are bankrupt as well.
I couldn’t believe these former athletes are not only struggling, but are literally penniless after their glory days. With the amount of money these guys pull in, it is amazing they can be so careless.
The video describes examples of what lead to their economic downfalls, such as medical expenses, friends who tend to ask for too much at times (freeloaders), as well as bad investments and — finally – egotism. That causes the former superstars to show off a bit too much, and pay for things that they do not need nor have the money for. The video said that many players entrusted their finances to investment advisers. Many players were involved in pyramid schemes – sometimes knowingly but moret commonly unknowingly. For example, one NFL Ponzi scheme was established by an adviser named Kurt Barton. This scheme was not only pitched by his company Triton Financial but also by former NFL players and Heisman trophy winners.
Retirement can be a slippery slope for these formers professional athletes. Many forget that they are human beings and make the same mistakes as we do, except certain mistakes can cost them millions and millions of dollars.