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Why Do Some Professional Athletes Go Broke?
Professional Athletes are famous for their careers and the amount of money they make.
There is a trend of what happens when most of the renowned athletes retire. Sports illustrated
documents that about eighty per cent of NFL pro layers file for bankruptcy only two years after
they retire. This trend has been identified in the NBA and soccer too. Pro athleticism is unlike
other professions. The window for earnings is small. Other professions might allow a person to
work for long periods, ranging from thirty to fifty years, but not athletes. An athlete is left with
the task of managing the money they made for the rest of their lives once they retire with only a
little of what they previously earned. Sports Illustrated also shows that many athletes lack
significant financial knowledge to manage the high pay they earn. Other times, they might hire
advisor and attorneys who might drive them to make investments that cost them later on in the
future. Another characteristic of athletes is that they begin their professional careers as early as
eighteen years of age. They start earning large sums of money that they get confused about what
to do with it. The richest people in the world are characterized by having simple lifestyles, but
not most athletes who find themselves broke. They tend to overspend on extravagance, which
later on makes their possessions almost worthless. In light of these facts, three professional
athletes were chosen for this paper: Diego Maradona, Allen Iverson, and Antoine Walker. Their
ethnicity is African American and Latin. Athletes from these ethnicities, fit the objectives of this
paper.
Maradona was born in Villa Fiorito, a slum outside the outskirts of the famous Buenos
Aires. The living conditions in which he was raised were not well. His soccer skill was
formidable, which earned him his first professional contract at fifteen years. He became the
breadwinner of his family from that day onwards. Six years later, he was signed by Barcelona
Football Club, something which then was a world-record fee. When he arrived in Europe, his
image as a professional athlete was marred by his hard-partying tendencies and temper issues.
His temperament was visible in his final Barcelona game in which he thrust his knee and
knocked out Atletico Bilbao's player knocking him out. This incidence made other football clubs
fear to buy him except for Napoli who decided to take a chance with him. The move to Napoli
was a downgrade. For the first two seasons, he carried the club by proving to have unsurpassed
technique, strong and quick. He captained for Argentina in eighty-six world cup where he led the
country to win against England. Maradona's fame surpassed boundaries and fans started to
consider him as a demi-god of sorts. He could not move through the city virtually, something
that made him get involved with the Camorra mob. They offered Maradona protection to places
he moved, provided him with hard drugs like cocaine, indulged his party taste, and sought him,
women. Maradona's large pay and lack of financial knowledge drove him to have the lifestyle he
lived. It is said that things between him and his wife were not alright, thus his constant carnal
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needs with other women. He had an affair with one of his Sisters' friend, Cristiana Sinagra,
whom he got pregnant but denied publicly. The failure of failing to recognize his son haunted
him. Even though he still played well, he used his extravagant vices as a means of escape. He
began longing for somewhere, quit for him to play football. After the 1990 World Cup,
Maradona faced drug charges which were followed by wiretaps. He was later banned from
playing football for fifteen months. Since he has been struggling with off-and-on alcohol and
cocaine use (Medel, 2020). Maradona had a huge debt accrued to extravagance. As of 2009, it
was announced that his debt was at thirty-seven million euros. This figure was forty million less
from the original debt after paying for expensive earrings and two watches. If only he was aware
that income is never guaranteed, planned his finances well, led a lifestyle within his means and
sorted issues with his family, he would not have struggled financially.
Antoine Walker is an all-star African-American NBA player who is thirty-eight years
old. He made over one hundred and ten million US dollars throughout his career. This figure is
nearly four times the amount that an average player makes in a league. Despite having earned
such a lump sum, he ran broke at some point in his life. Like Maradona, he joined the league at a
very young nineteen years as a player for Boston Celtics. He hired a financial advisor who
helped him in making long-term plans for his finances. Being young, Walker had a lot of plans
for his newfound wealth. The financial advisor gave walker some insights, but due to arrogance,
he ignores the knowledge he was being exposed to and decided to spend his money whichever
way he wanted (Rusoff, 28 June 2019). Again, like Maradona, he did not come from a rich
family. They were six siblings, and his mother was the only provider for the family. Once
Walker joined the league as a rookie, he automatically became the breadwinner of his family,
which blew his first rookie salary. The money kept coming in, which made Walker have the least
of care in whatever he put himself into. Like most athletes. He began having a taste for luxuries.
He built a multi-million home for his family from the ground up. Also, he bought a lot of luxury
cars, most of which were BMWs. Maybach and Bentleys. His arrogance and love for fine things
made him so vain that he ould not wear the same suit twice. Walker was not known to be a
selfish person. As an athlete who made a lot of money, he decided to extend his generosity to
acquaintances and friends. He made sure that they shared the same lifestyle as he did by
providing gifts and paying for luxurious trips to various destinations. It was not long before he
and his fellow NBA players indulged into gambling. It was so chronic that Walker lost nearly six
hundred and fifty thousand US dollars in only two years. Walker made significant investment
decisions since he felt the need to create a system that will maintain his lavish and extravagant
lifestyle. Walker bought over a hundred and forty properties in Chicago. Also, he invested in real
estate to ensure his family did not suffer after he retired. The flipside of making such investments
as he was at the peak of his career focused most of his time and energy at paying the NBA. Time
to look after his investments were limited hence was caught unaware by the real estate crash. He
defaulted some loans in which he signed to be a personal guarantor, therefore, faced some legal
issues and his land lost value—the legal issues regarding his default to pay loans involved a
series of cases. Walker missed out on default judgements and court dates, something that costed
him most of his properties. Walker was declared bankrupt in 2010 with about thirteen million US
dollars cited to liabilities. His bank accounts were frozen and were stripped off his credit cards.
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He was forced to liquidate most of his possessions include the ring awarded to him after winning
in NBA championships in 2006.
Like Maradona and Walker, Allen Iverson had humble beginnings. He lived in a house
with a floor covered in sewage and spent some of his time in Jail. Looking at these beginnings,
no one could have ever thought Allen Iverson would become an NBA star. His career started
after earning a Georgetown scholarship where he averaged twenty-six points. He later became
rookie of the year and claimed MVP honours. He also led Sixers to finals (Muniowski, 2019). He
made about two hundred million US dollars from contracts. Like the rest, Iverson was infamous
for his spending. He used this money in whichever way he deemed fit. He bought his family,
acquaintances and friends luxurious gifts. It was reported that he did not have spending plans.
Rather, he used to store money in garbage bags, some of which went missing. His bad habits
prolonged to the point of buying a new car after he forgot where he had parked the one he
previously owned. Iverson spent his money on jewellery, vehicles and mansions. He also loved
visiting strip clubs where he dropped not less than ten dollars. Since most athlete careers do run
for long, Iverson was out of the league. The public did not know Iverson struggled financially up
to when he failed to pay $859,896.46 as ordered by the court. His monthly expenses were
estimated to be about three hundred and sixty thousand US dollars.
Looking at the three case studies, it easy easier to deduce why athletes go broke. Poverty,
crime and drugs mostly characterize Latin and African-American societies. The three athletes
came from humble beginnings. They did not learn or get exposed to a lot of money while
growing up. The age in which they started earning large amounts of money is very young to
know much about money. When huge lump sums started coming in, they did not know what to
with it. They never knew about stocks, taxes and impulse purchases. Another common factor is
trusting people easily and aggressive spending. Maradona made the mistake of trusting the
mafia. Walker failed to heed the advice of his financial adviser. He also trusted the wrong people
in running his businesses. All of them showed similar aggressive spending habits. They craved
for expensive lifestyles that they never had as kids. They invested in material things like
vehicles, jewellery and mansions, which have poor resale value. Some exceptions happen when
it comes to certain jewellery like watches. Regardless of their net worth, these athletes failed to
participate actively in their financial affairs. Living a lifestyle that does not scratch their budgets
is advice that would have been resourceful for them.
In conclusion, a few things can be learnt from the three cases. When athletes are at their
prime, they should take the initiative of owning their money. Often, they get detached from the
huge numbers of money coming in and do not know how it gets all gone at once. The second
takeaway is preserving capital. It is quite a difficult venture, but once the prime years are gone, it
becomes very hard for an athlete to make as much as they did. Most settle for second careers.
Investing money and saving are ways in which athletes can preserve capital. Giving gifts to
family and friends is a nice gesture but an athlete should learn to say no in case it affects the
means in which they live by.
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Work Cited
Medel, Ismael Lopez. "Diego Maradona." Athletes Breaking Bad: Essays on Transgressive
Sports Figures (2020).
Muniowski, Łukasz. "Beyond (Auto) Biography: Narrating the Lives and Achievements of
Selected Leading NBA Players After the Michael Jordan Era." (2019).
Rusoff, Jane Wollman. “Ex-NBA Star Says He Should've Listened to His Financial
Advisor.” ThinkAdvisor, 28 June 2019, www.thinkadvisor.com/2019/06/28/ex-nba-star-
says-he-shouldve-listened-to-his-financial-advisor/.