Why Are Pro-Athletes Going Broke After The Game?

Many professional athletes are going belly-up after a few years in retirement. Why is that? Why are so many of them African Americans who played the game well, were once superstar athletes with millions of adorning fans and are now just “regular broke folks?” Is it just blatant mismanagement of funds, Bad investments, baby mama drama or are they still trying to live the superstar life-style on a prime rib diet?

While some do have that infamous baby mama drama (Terrell Owens on back child support), there Is no reason why these athletes should be broke after earning millions of dollars during the span of their careers. Take retired Major League Baseball player Otis Nixon for instance. He was arrested in Atlanta for crack possession, and could not come up with $11,000 for his bail. Mind you, Otis earned proximately 19 million dollars from 1989 to 1999. Former “Dirty Bird” Atlanta Falcons star Running Back Jamal Anderson, who earned over 70 million dollars during the span of his NFL career, just lost his 10 bedroom mansion in Atlanta due to foreclosure. And Terrell Owens, former Dallas Cowboys star Wide Receiver, earned an approximate 54 million dollars during his NFL career, yet he’s doing community service because he can’t pay his back child support.  But the clincher is Philadelphia 76ers star Guard Allen Iverson. This pro athlete earned a whopping 150 million dollars during the span of his career and now he’s crying in Black Enterprise that he’s so broke, he can’t afford a hamburger. Honestly, I wished these pro athletes had taken a page from former Detroit Lions Defensive Back Lamar Campbell. He wasn’t privy to  super-stardom or having a multimillion dollar contract, but he got his head in the game, created a plan for himself so he could transition from the NFL to real life; he got a business degree from Wharton’s.

Lamar’s Interview: Let’s talk about the nest egg. It really doesn’t matter if you’re making $200,000 or $4,000,000 a year, you do have a lot of athletes who go into pro sports making all this money, but don’t have the financial literacy to invest properly and spend wisely. When their career is over, a lot of them are broke as hell.

How did you educate yourself about financial literacy?

You know what, I was lucky enough to have some really good veterans around me. My family wasn’t the type of family that really talked about finances even though we had the Sunday dinners. They never really said, Lamar make sure you understand credit.

I’m going to put this on record to say, in the past, most black families didn’t really educate their kids on credit because there wasn’t an understanding of credit. It didn’t matter where you’re from then. I’m from the islands, but I grew up in the U.S. and we never talked about credit. It was like, what’s that? I learned about credit when I went away to college and began receiving a bunch of credit card offers in the mail and the effects of not paying those bills on time.

You get those credit cards in college and all you’re saying to yourself is, this is free money and not realizing you have to pay it back. You don’t really understand credit or the importance of credit until you have to buy that first car or that first home. Then unfortunately, if you’re a ball player, you have enough money to just pay those debts off so you never really understand how it affects your credit and that how much you pay in finance charges is really determined by how well you pay your bills. You do have a lot of guys who go into the NFL not educated about their financial future. They’re ignorant. They just don’t know because no one ever taught them about handling their finances. Say you have a mom on welfare with two kids. People complain about how they don’t understand why she stays on welfare and not go get a job. What they fail to realize is that once you’ve been on welfare for a  been on welfare for a long period of time, you get hooked, complacent and have a lack of motivation to do anything other than the typical (live day-to-day). You can’t just cut people off welfare without equipping them with the tools to be able to sustain themselves. They have got to learn how to earn a living and be educated on money management.

You know my son is four years old, but he understands interest rate. He would ask me for $1.00 to get some candy and chips and I would tell him he could have the $1.00, but he had to pay me back $1.25. I do that so he will grow up understanding credit and what I’ve been privy to. My parents didn’t come from a lot of money, but I’m sure if they had known that credit was that important, especially in this market, I know for sure my parents would have made it a point to discuss finances. You know, it’s been tragic for everyone the last 10 years or so. If they would have known this was something that I needed, they would have told me. They grew up struggling so they never had to worry about high money coming into the house-hold; they just got by. Their financial literacy was just to get by each month. Now times have changed. Credit has become so important; no telling what it’s going to be like for the next generation. Continue reading

Read the rest of Lamar’s interview.