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They become Turbo Americans.
Probably belongs on the NBA thread. But I remember Corey Alexander about to make the same mistake until David Robinson talked to him. If I remember correctly Corey then made sound financial decisions. Just another reason to be proud of the Admiral as a Spur.
http://sports.espn.go.com/espnmag/st...t&lid=tab1pos1
By Rick Reilly
Congrats, newly minted NBA rookie!
Now you've been drafted. Next comes the delicious multimillion-dollar contract. And that's when you must do what most NBA players do: start going through cash like Jack Black through the Keebler factory.
Filing for bankruptcy is a long-standing tradition for NBA players, 60% of whom, according to the Toronto Star, are broke five years after they retire. The other 40% deliver the Toronto Star.
It's not just NBA players who have the fiscal sense of the Taco Bell Chihuahua. All kinds of athletes wind up with nothing but lint in their pockets. And if everyone from Johnny Unitas to Sheryl Swoopes to Lawrence Taylor can do it, so can you! With my How to Go Bankrupt* DVD series, it's a layup to go belly-up!
Ten essentials, just to get you started:
1. Screw up, deny it, then fight by using every lawyer and dime you have. Roger Clemens just sold his Bentley, reportedly to pay legal bills. Marion Jones lawyered herself broke before she finally copped and went to prison. Paging Mr. Bonds, Mr. Barry Bonds.
2. Buy a house the size of Delaware. Evander Holyfield was in danger of losing his 54,000-square-foot pad outside Atlanta, and it's a shame. He had almost visited all 109 rooms!
FROM $300M UP TO $27M DOWN? EASY.
3. Buy many, many cars. Baseball slugger Jack Clark had 18 cars and owed money on 17 when he went broke. And don't get just boring Porsches and Mercedes. Go for Maybachs. They sell for as much as $375,000—even though they look like Chrysler 300s—and nobody will ever know how to pronounce them, much less fix them.
4. Buy a jet. They burn money like the Pentagon. Do you realize it costs $50,000 just to fix the windshield on one? Scottie Pippen borrowed $4.375 million to buy some wings and spent God knows how much more for insurance, pilots and fuel. Finally, his wallet cried uncle. The courts say he still owes $5 million, including interest. See you in coach, Scottie! (For that matter, why not a yacht? Latrell Sprewell kept his 70-foot Italian-made yacht tied up in storage until the bank repossessed it, in August 2007. He probably sat at home and cried about that—until the bank foreclosed on his house, this past May.)
5. Spend stupid money on other really stupid stuff. In going from $300 million up to $27 million down, Mike Tyson once spent $9,180 in two months to care for his white tiger. That's why Iron Mike's picture is on our logo!
6. Hire an agent who sniffs a lot and/or is constantly checking the scores on his BlackBerry. Those are the kinds of guys who will suck up your dough like a street-sweeper. Ex-Knick Mark Jackson once had a business manager he thought he could trust. Turned out the guy was forging Jackson's signature on checks—an estimated $2.6 million worth—to feed a gambling jones. "And it wasn't like I was a rookie—I was a veteran," Jackson says. The only reason he says he's getting some money back is because he didn't …
7. Sign over power of attorney. What's it mean? Who cares? Just sign! The guy you're signing it over to knows. And while you play Xbox, he'll be buying large portions of Switzerland for himself. Kareem Abdul-Jabbar let an agent named Tom Collins have power of attorney once, and it cost Kareem $9 million before he figured it out.
8. Spend like the checks will never stop. Also known as the Darren McCarty method. Despite earning $2.1 million a year, Red Wing McCarty, who started a rock band called Grinder, went splat by investing in everything but fur socks ($490,000 in unlikely-to-be-repaid loans) and gambling large ($185,000 in casino markers). In other words, a Tuesday for John Daly.
9. Just ball. Don't write your own checks. Don't drive your own car. Don't raise your own kids. Just be a tall slab of skilled meat for others to feast on. Not to worry. It'll be over before you know it.
10. Most of all, set up a huge support system around you. It'll be years before you'll realize they call it a support system because you're the only one supporting it. They're all on full-ride scholarships at the University of You. "Guys go broke because they surround themselves with people who help them go broke," says ex-NBA center Danny Schayes, who now runs No Limits Investing in Phoenix. "I know all-time NBA, top-50 guys who sold their trophies to recover."
See, kid? You can be a top-50 guy!
So order my How to Go Bankrupt series now, and get this empty refrigerator box to sleep in, absolutely free!
*(Only $1,449 plus shipping, handling, service fee, dealer prep and undercoating. Per month.)
Love the column, hate the column, got a better idea? Go here.
Want more Life of Reilly? Then check out the archive.
They become Turbo Americans.
great article
3 steps:
1. Insure against fraud
2. hire a CFP and listen to most everything he/she tells you.
3. Insure against fraud
get a lawyer to watch that CFP
get another lawyer to watch the other lawyer
Could have been better. He just mailed in #9.
wonder if sprewell would come back and take the wolves offer now to help 'feed his family'.....
Just don't be anxious. Take your time buying a house, especially if you aren't sure you'll even be in that city much longer (see Kevin Durant in Seattle). Get one nice car, perhaps two. Stash your cash in the damn bank, put a small amount in gold, another slice in energy funds, leave plenty of cash to accrue interest, maybe make a real estate play. Chill. And no posses necessary.
Actually the first mistake is assuming you'll get a multi-million dollar contract in the future. Act like all you will ever receive is the rookie contract, and bank accordingly.
It's the same thing lottery winners do, and the reason most of them are broke - they spend, spend, spend. Spend on themselves, quit their jobs so that there is no other income source, and buy more than they can afford to live on without supplemental income. Spend on family and friends who crawl out of the wood work. Don't look at their own finances, hire untrustworthy people.
Why not buy a modest loft/townhouse/condo that can be rented out in the future? A nice car (you only need one, really), and find a reputable financial advisor to take care of the rest and get it producing more money. That is your retirement fund there, kids. If you don't want to have to be working in the corporate world when you have an injury or after being an NBA journeyman who never made it big - invest that money like your life depends on it.
its not bad being poor....you learn how to survive and live long....and all you need is a good life insurance policy...now i know you cant compare 250,000 to 25 million...once your gone you aint coming back....so it all equals the same....after all in the end we will be alone, just you and whomever your maker maybe....so i say if ya gotum.( and ive never smoked in my life).smokum..just pay that life insurance and it will all be fine...life is good
Somehow I don't see Duncan or Yao going broke. These guys are smart businessmen. Michael Jordan too.
I don't think it's quite that simple, but I agree that life insurance is a big piece. Heck, depending on your age (and whether you smoke) you can get half a mil of life insurance for like 25 bucks a month.
...that is, if you do something smart like get term insurance and not sign up for the policy the salesman "recommends".
Nice.They're all on full-ride scholarships at the University of You.
after federal tax, state tax, county tax, city tax, road tax, school tax, and all the babe mamas i ve gotta to pay, mang, there ain't much left in my 100mil
sure, lots of these guys make mistakes...but everyone does...except we dont have jobs that on average only last 3 years and get paid millions of dollars.
Also, It is hard for guys making 40K a year to preach to million dollar athletes
Many have had lives completely different than the average fan
I have never experienced:
having scouts/agents/shoe companies chasing you since you were 13 years old, changing high schools several times, traveling across the country to play against the top AAU talent, family members uprooting their lives to be with you while you're in college, people constantly trying to deceive you, knowing your entire career could be over with the turn of a knee, shady people also trying to hang around you for their personal gain
Of course in the end they should be held accountable
but I try to be a bit more understanding and have some sympathy.
nice read, gambling is addicting.
that support system is a killa.
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