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How and Why Athletes Go Broke (2009)

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Re: How and Why Athletes Go Broke (2009)

#61

Post by test6554 »

Kluny wrote: post #49
ggm wrote: post #13

In many situations, people who are identified as being at risk have somebody else placed in control of the finance, by court action. Brain injury patients for instance. Hmmm.. hang on.. whats the major risk factor in the football circuit again? Seriously: the recruitment of minors for major league with giant cash benefits should require them to sign a consent form for arms-length management of their capital for some…

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…

They do exist: https://en.wikipedia.org/wiki/List_of_black_NHL_players

Re: How and Why Athletes Go Broke (2009)

#62

Post by test6554 »

ChuckMcM wrote: post #55
southphillyman wrote: post #50

The stereotype is that many of these athletes go broke because they are foolhardy with money. I appreciate that this article highlighted that a lot of these guys go broke because of scamming financial advisors. The athlete attempts to do the responsible thing and hires someone they are led to trust with managing their assets only to be ripped off. I'm not sure how financial literacy prevents this from happening when…

Agreed, look at it from their perspective. They haven't been around a lot of money before, they don't have a lot of friends who have been around a lot of money either, so they don't really know even what questions to ask to understand the people who are arguing to be their financial advisors. Perhaps major league sports would do well to help train their athletes in the basics of financial management in order to help…

It's not their responsibility though. The player could take a course on their own initiative.

Re: How and Why Athletes Go Broke (2009)

#63

Post by crescentfresh »

dangerboysteve wrote: post #24

ESPN's "30 on 30" sports docs looked into this matter and did a really goof job and worth watching. The episode is called "2 Broke". https://www.youtube.com/watch?v=Elfw0ESih-A

What a bunch of goofs.

Edit: downvotes, really folks? You don't see the parent's typo?

Re: How and Why Athletes Go Broke (2009)

#64

Post by watwut »

manigandham wrote: post #27
ggm wrote: post #13

In many situations, people who are identified as being at risk have somebody else placed in control of the finance, by court action. Brain injury patients for instance. Hmmm.. hang on.. whats the major risk factor in the football circuit again? Seriously: the recruitment of minors for major league with giant cash benefits should require them to sign a consent form for arms-length management of their capital for some…

It's called personal responsibility. They're earning sums that many will never reach and it's on them to figure out what to do with it. Nobody is stopping them from asking for help and it's not like there aren't enough examples to learn from by now. Someone who doesn't have responsibility can't be forced into it.

You can definitely raise children for more responsibility or away from it. If a lot of top sportmen can't manage finance, that would suggest that there is something about the system that raises them (they spend more time on sport then anything else) that is that way.

Which would suggest that responsible parent won't put children into such system.

Re: How and Why Athletes Go Broke (2009)

#65

Post by jhowell »

ggm wrote: post #13

In many situations, people who are identified as being at risk have somebody else placed in control of the finance, by court action. Brain injury patients for instance. Hmmm.. hang on.. whats the major risk factor in the football circuit again? Seriously: the recruitment of minors for major league with giant cash benefits should require them to sign a consent form for arms-length management of their capital for some…

It seems that we, the people that read about athletes and celebrities losing their money while we commute to work feel the best course of action is less control. Arguably similar, people in technology who hunt equity at the expense of future financial stability. We consider their competence at managing money in the but not the latter.

Re: How and Why Athletes Go Broke (2009)

#66

Post by brightball »

ggm wrote: post #13

In many situations, people who are identified as being at risk have somebody else placed in control of the finance, by court action. Brain injury patients for instance. Hmmm.. hang on.. whats the major risk factor in the football circuit again? Seriously: the recruitment of minors for major league with giant cash benefits should require them to sign a consent form for arms-length management of their capital for some…

There was actually a sports agency run by an accounting firm that did something close to this. They basically said, “We will make sure you and your family are taken care of for the rest of your life but it means there are certain things you have to let us handle with your finances so that we can say ‘no’ to people for you.”

They also had to agree not to spend on drugs, strippers, excessive houses, etc.

Re: How and Why Athletes Go Broke (2009)

#68

Post by rconti »

MrFantastic wrote: post #41
Skunkleton wrote: post #2

This sounds a lot like how most people go broke. Even when you are talking about people who have been fortunate enough to make a lot of money (like lotto winners), the story sounds the similar. Maybe we need better financial education in the public school system?

The education system depends on student loans. Financial education would make people question the value of a college education.

That's fine. Educate 'em on financial literacy at public middle schools and high schools. Let the colleges and universities make the argument that their education is worth the cost.

Re: How and Why Athletes Go Broke (2009)

#69

Post by efa »

I don't know all the tax implications around huge salaries like these, but every time I read one of these stories I always wonder why they don't just stick their money in t-bills or CDs. Something completely risk free that will get a modest return. If you have 20 million in the bank do you really need to invest in high risk stuff to try to double your money?

The problem is everyone they've ever known comes out of the woodwork and is hitting them up for money or pitching some great investment. That's the hard part. Saying "no" to these people.

Re: How and Why Athletes Go Broke (2009)

#70

Post by talmand »

Kluny wrote: post #49
ggm wrote: post #13

In many situations, people who are identified as being at risk have somebody else placed in control of the finance, by court action. Brain injury patients for instance. Hmmm.. hang on.. whats the major risk factor in the football circuit again? Seriously: the recruitment of minors for major league with giant cash benefits should require them to sign a consent form for arms-length management of their capital for some…

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…

I'm curious as to how hockey is any more expensive than any other sport that has player equipment and a privileged background is more beneficial to making it to the professional level than any other sport.

Could it be that black kids as a group just isn't that interested in playing hockey?

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