PROFESSIONAL ATHLETES FACE UNIQUE FINANCIAL REALITIES
Professional athletes face a unique set of financial realities and problems, unlike any we “normal” people face.
No, this is not a bleeding heart tale of a professional athlete who lost his wealth through mismanagement. This is simply an attempt to help laymen to understand the unique set of circumstances facing a professional athlete who suddenly receives wealth.
The first thing to understand is that almost all professionals are out of sports by the time they are thirty. If they live to be the average age, that means they are looking at fifty years out of sports, away from mammoth incomes. And then there is the injury factor. A rookie may well make three million dollars after signing his initial contract, but if he is injured and never returns to sports after two years, that three million dollars suddenly is spread out over fifty years, meaning about $60,000. No, that is still not a poverty wage, but I think the point is clear.
And then we have what I call the “social factor.” Take an eighteen year old athlete from a poor neighborhood in Alabama and give them sudden wealth and all manner of problems start to arise. Friends and relatives suddenly ask for loans. The temptation to purchase new cars and homes is suddenly overwhelming. The idea of financial planning and budgeting is completely foreign to them.
And what about life after sports? Few athletes are trained for anything other than sports. They have a unique skill set, in sports, but after that, many are left with very little on their resume. Sure, a few move on to sports commentary after retirement, and a few on to coaching, but for every one who has one of those positions to fall back on, there are literally thousands who have nothing as a fall-back plan.
Without a doubt, professional athletes have a nice financial head start as they begin their earning years, but few of them are prepared for the years following their playing career.
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