How is it possible that over 80% of retired NFL players end up declaring personal bankruptcy just a few years after leaving the NFL? Aren’t these guys millionaires? Shouldn’t they be set for life? You would think. This applies to all professional athletes, celebrities, and lotto winners as well.
So why does this happen? I would venture to say that it is because 80% of NFL players do not know a thing about managing money. A lot of these players have no financial education and when they come into a large sum of money, they blow it.
Just as an example, it is estimated that Warren Sapp (hall of fame, defensive tackle who played for the Oakland Raiders and Tampa Bay Buccaneers) made around $60 million during his NFL career. After squandering millions, taking out huge mortgages on mansions, and going into massive amounts of debt, Sapp declared personal bankruptcy in 2012, just 5 years after retiring from the NFL.
Just having a high annual income does not make you wealthy. People who do not know anything about how money works, usually spend most, all, or more than their annual earnings. Wealthy people on the other hand, know that they must pay themselves first. They know that if they have enough discipline to spend only a portion of what they earn and use the leftover money to buy and build income generating assets, they will have life long income that will always be there to replenish their nest egg. This is how real millionaires are made and how generational wealth is built.
“5 Reasons Why 80% Of Retired NFL Players Go Broke
Sports Illustrated recently estimated that 80% of retired NFL players go broke in their first three years out of the League. How is this possible in a sport rolling in revenue with an average salary of almost $2 million a year? With few exceptions, the star players I have represented since salaries exploded are set financially for life. These are the players at the tip of the compensation pyramid, but what about the rest? The median income in the NFL is roughly $750,000 and the average career span is less than four years. Most college graduates don’t attain these levels of revenue in their first years out of college–why are the athletes struggling?…”
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