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How and Why Athletes Go Broke (2009)

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Re: How and Why Athletes Go Broke (2009)

#151

Post by civilitty »

ChuckMcM wrote: post #135
kpil wrote: post #121

Earlier quoted context omitted.

If you put that kind of money in a savings account, the bank will call you twice a day until they have made you move the money into something more profitable (for them.)

I would be surprised if the bank complained. They are only on the hook for $250K per the FDIC and could cover it with a low interest interbank loan from the FED. Since their mandatory reserve is only a fraction of the cash on deposit they will happily leverage it for greater returns paying you your paltry .7% while collecting much more than that.

The bank wouldn't complain but if your account is significantly above the FDIC's $250k limit, it's usually worth it for them to invest a few days or weeks of a salesperson's time to get you to convert to a more profitable investment account. That kind of human attention is just not profitable with an account that only has 10s or 100s of thousands of dollars.

Re: How and Why Athletes Go Broke (2009)

#152

Post by specialist »

manigandham wrote: post #128
mfringel wrote: post #124

Earlier quoted context omitted.

You didn't say "responsibility", you said "personal responsibility". "Personal" implies that they should take sole responsibility for their circumstances, ignoring any other agents involved. So, yes, it does appear you're talking about right and wrong.

What a strange interpretation. Did you read the entire thread? The comment I was originally responding to said teams "should require [athletes] to sign a consent form for arms-length management of their capital" which I absolutely don't agree with because they are adults who can choose for themselves. And yes, it's personal because it's their money and their choice to either spend it or do something else. I don't car…

The phrase "personal responsibility" has decades of rhetorical baggage, from long use as a dog whistle by the USA's political right.

Going with the principle of charity: I apologize for assuming you were using "personal responsibility" as a bludgeon.

Re: How and Why Athletes Go Broke (2009)

#153

Post by mobilefriendly »

Spooky23 wrote: post #143
Kluny wrote: post #49

Earlier quoted context omitted.

Really, taking their adult autonomy away is the first step? How about education? This might be anecdotal, but I feel like we don't hear these athlete bankruptcy stories as often about hockey players. Why? Because they're all white, not black. Putting a kid through junior hockey is expensive and hockey players tend to come from privileged homes with much better financial education than young black football players. Th…

That’s a unique spin. It’s not about infantilizing. Hockey players also make a lot less, with fewer big payouts and thus fewer big flameouts. Personally, I think the unions should help guide these guys. New money leading to bankruptcy is a universal story, not unique to any race. Athletes are particularly vulnerable to scammers, as they spend a lot of time isolated by coaches with a small group of people. Self dealin…

Hockey players make more than football players.

Re: How and Why Athletes Go Broke (2009)

#154

Post by paulddraper »

djellybeans wrote: post #139
pascalxus wrote: post #123

At the end of the day, it's the same reason most people go broke: they know nothing about money. Unfortunately, Money is the most important thing in the world because you can't get anything without it. And yet, it's not even a primary subject taught in k-12. Where are people supposed to go for a decent financial education? Instead k-12 teaches kids about useless butterflies and countless other things that are of less…

IMO the financial industry tries to make it seem so much more technical and complex than it is. Even for how an average person can invest money. A lot of people are perceiving it as such.

Well you're not going to be inclined to pay them for something simple.

Re: How and Why Athletes Go Broke (2009)

#155

Post by meow1032 »

saikit wrote: post #59
Kluny wrote: post #49

Earlier quoted context omitted.

Really, taking their adult autonomy away is the first step? How about education? This might be anecdotal, but I feel like we don't hear these athlete bankruptcy stories as often about hockey players. Why? Because they're all white, not black. Putting a kid through junior hockey is expensive and hockey players tend to come from privileged homes with much better financial education than young black football players. Th…

Could be an exception to the rule, but the highest profile athlete bankruptcy recently is from a hockey player http://ftw.usatoday.com/2016/11/columbus-blue-jackets-jack-j...

That was a bit of a different story since his parents took out loans in his name.

Re: How and Why Athletes Go Broke (2009)

#156

Post by madengr »

Baeocystin wrote: post #140
pascalxus wrote: post #123

At the end of the day, it's the same reason most people go broke: they know nothing about money. Unfortunately, Money is the most important thing in the world because you can't get anything without it. And yet, it's not even a primary subject taught in k-12. Where are people supposed to go for a decent financial education? Instead k-12 teaches kids about useless butterflies and countless other things that are of less…

Do you have any book recommendations? I have some younger relatives graduating from college soon, and although they are bright, I worry about their financial sense. I talk to them regularly, but something more concrete would likely also help.

A Random Walk Down Wall Street

Dave Ramsey videos on YouTube.

Re: How and Why Athletes Go Broke (2009)

#157

Post by fantispug »

Baeocystin wrote: post #140
pascalxus wrote: post #123

At the end of the day, it's the same reason most people go broke: they know nothing about money. Unfortunately, Money is the most important thing in the world because you can't get anything without it. And yet, it's not even a primary subject taught in k-12. Where are people supposed to go for a decent financial education? Instead k-12 teaches kids about useless butterflies and countless other things that are of less…

Do you have any book recommendations? I have some younger relatives graduating from college soon, and although they are bright, I worry about their financial sense. I talk to them regularly, but something more concrete would likely also help.

"If You Can" by William J Bernstein.

It gives a simple conservative investing strategy, and refers to other great books for the details.

Available here: https://www.etf.com/docs/IfYouCan.pdf

Re: How and Why Athletes Go Broke (2009)

#158

Post by mobilefriendly »

Spooky23 wrote: post #150
Brockenstein wrote: post #52

Earlier quoted context omitted.

>Then do the right thing and set Social Security as a guarantee at the same age for everyone. You have to take in consideration a few factors governing the original social security age limits. IE Life expectancy was significantly less. People live on average quite a bit longer now, addressing that reality isn't a bad idea. The other thing to consider is the money we're paying in now isn't being saved for our benefit…

Social Security is perfectly sustainable. The problem with is the demographic bump of the baby boom and use of it as a political football during the 60s and 70s when benefits were spun up, followed by the congress reducing funding by capping payments.

Payments have always been capped (maximum taxable earnings), your history is factually wrong. Congress spends the surplus but the only actions ever taken by Congress on the revenue side of Social Security have been to increase taxes paid into the system.

Re: How and Why Athletes Go Broke (2009)

#159

Post by WalterBright »

mobilefriendly wrote: post #149
ChuckMcM wrote: post #135

Earlier quoted context omitted.

I would be surprised if the bank complained. They are only on the hook for $250K per the FDIC and could cover it with a low interest interbank loan from the FED. Since their mandatory reserve is only a fraction of the cash on deposit they will happily leverage it for greater returns paying you your paltry .7% while collecting much more than that.

This highlights the problem-- the most "conservative" approach, a savings account, is actually TERRIBLE financial advice. First the money won't keep pace with inflation and second a bank failure will wipe out the fortune. That happened to savers in 2008, most notably the failure of IndyMac.

Of course. But you have to park the money somewhere while you learn about where to invest it.

If you've got more than $250K, I'd split it up into multiple accounts at different banks.

Re: How and Why Athletes Go Broke (2009)

#160

Post by hi41 »

pascalxus wrote: post #123

At the end of the day, it's the same reason most people go broke: they know nothing about money. Unfortunately, Money is the most important thing in the world because you can't get anything without it. And yet, it's not even a primary subject taught in k-12. Where are people supposed to go for a decent financial education? Instead k-12 teaches kids about useless butterflies and countless other things that are of less…

Yes, my thought too. I want to learn about managing money properly. Do you know any good book which is friendly to lay persons like me. I don't want the book to be too dry but also don't want a book like the idiot guide which tries very hard to be funny.
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