We’ve all heard the stories of professional athletes who were catapulted out of humble, if not impoverished, circumstances into multimillion-dollar contracts and endorsement deals, only to end up bankrupt just a few years after retirement.
According to Sports Illustrated, more than two-thirds of National Football League players experience financial hardship or declare bankruptcy within just two years after retirement. Some 60 percent of National Basketball Association players were broke just five years after leaving basketball, according to that same report.
One of those pro athletes who lost everything was former Antoine Walker, three-time All-Star who played with the Boston Celtics among other teams during his career. Having once been worth $108 million, Walker declared bankruptcy just two years after he retired from basketball, and he wasn’t even 40.
Walker says that his lack of financial acumen coupled with profligate spending habits and the responsibility he felt to give his family a better life led to his situation. He says, “When I came in at 19, I didn’t think about 39.”
Now Walker is working to help young college and professional athletes avoid his mistakes. He’s partnered with Morgan Stanley to help teach them how to manage their sudden wealth and make sure that their money lasts beyond their playing years. The investment firm has developed a financial education program geared specifically towards young athletes.
The program includes teaching them how to create a budget, save money, build investment portfolios (while avoiding risky investments), maintain a good credit score and choose qualified financial advisors. Athletes like Walker talk to them about the harsh reality of what can happen if they don’t.
As one Morgan Stanley executive says, Walker and other retired athletes aren’t a “typical…advisor coming in with a suit and tie…and talking at people or over their head.” Walker notes that when he and others who’ve been in his situation “can come in and really let them see it in real life, I think it makes a huge difference.”
You don’t have to be a multi-millionaire pro athlete forced into retirement by an aging body and an accumulation of injuries to get into financial problems. It can happen for many reasons, often beyond people’s control — like medical debt. New York bankruptcy attorneys can help people determine the best solution for taking charge of their financial situation and getting on the right path.
Source: Fox Business, “After Blowing $108M, Antoine Walker Helps Athletes Avoid Bankruptcy,” Thomas Barrabi, June 29, 2016