There seems to be a lot of exposés being filmed on the token broke, once-millionaire athlete. The sexy fall from grace that audiences lavish almost as much as the rags to riches story. As more athletes get revealed for their poor financial choices, or bad luck in investing, it seems as if more of us are putting out our opinion on them. And what are our opinions? They were immature, stupid, careless, and greedy.
We ponder on how it is that someone can gain so much capital throughout their career but have nothing to show for it in retirement.
Many of us with these opinions are not financially educated ourselves but we assume that with that sort of money we would have taken the time to get educated. I cannot sit here and say that I believe this to be true, what I do believe is that our overly transparent news cycle has misled us into believing that we understand rich people problems.
When we hear of a millionaire going broke, we project our own lives unto the “what-ifs” of the athlete’s situation and assume that we could do so much better. We picture our day to day expenses, humble mortgages, and credit card debts and think of how well we would do with 20 million dollars trickling in by the tens of thousands every month.
Are we being honest with ourselves?
Most people I know spend up to the amount of money that they bring in on a bi-weekly basis. When people get a raise that equates to $100 extra a check, they unconsciously find a way to bring their expense line up an extra $100. The more we make/have, the more we tend to spend. Imagine what people would do with an extra million?
Part of the reason why athletes burn out on their money is due to the same thing that happens with lottery winners – here’s an analogy; have you ever gone to the grocery store when you’re starving? Chances are by the time you leave the store, unpack your groceries and sate your hunger, you are looking at your cupboards wondering why in the hell you felt the need to buy all the extra crap!
Too much at one time is a hard task to manage for anyone let alone a once-broke College student turned superstar NBA ball player. When you have so much of it you will tend to give out “loans” to friends and family, buy your parents a massive mansion, pay your buddy’s debts off, and buy all the toys that you have always wanted. You have never invested in your life or sought the scholarship to know how to do so – so naturally anything you invest in will be a gamble and it’s as if a new opportunity presents itself every day.
We must remember that a subjective opinion is still an opinion and the star athlete who lost millions to be broke in retirement may not be as foolish as you assume him to be. We should all take their numerous examples of rags to riches to rags as a reminder that money, the game of money, and winning is based on planning, experience and allowing the right people to have a say in what you do with it.See some words or phrases that you don't understand? Check out The Dragon's Lexicon.