Many Maryland readers may be surprised to learn that players within the National Football League experience high rates of bankruptcy. In fact, nearly 16 percent of those who were drafted between 1996 and 2003 have sought consumer bankruptcy protection within 12 years of retiring. The average earnings of an NFL player is estimated to be nearly $1.9 million, which would make many people believe that players are protected from financial strife. In reality, however, these athletes are not safe from the same sort of financial pressures that affect the rest of us.
When considering the reason why so many NFL players seek personal bankruptcy protection, it may be helpful to think about the age at which many of them get their start. Most players begin their professional football career when they are very young, often right after college. Years on the field will take a physical toll, however, and many players are forced to retire early due to repetitive injuries.
At the same time, many young players lack the financial savvy to properly invest their wealth. They are also placed in positions in which an extravagant lifestyle seems to be the norm, and many want to keep pace with players who have earned far more over the course of their careers. This can lead to excessive spending and a lack of savings, all while the career clock is ticking in the background.
Yet another mistake that many NFL players make is trusting a friend or family member to manage their wealth. While these individuals may have no malicious intent, they may also lack the skills and knowledge needed to maximize wealth and minimize taxes. Hiring a professional financial advisor is a far better course of action.
For most Maryland residents, the need to balance the stresses of a professional football career with one’s long-term financial goals is not a pressing concern. However, some of the influences that are mentioned above may have contributed to the need to seek consumer bankruptcy protection, just as many NFL players have done since retirement. There is no shame in searching for a fresh financial start, as evidenced by the fact that people from all walks of life and all levels of success have chosen the same path.
Source: Deseret News National, “What the American family can learn from the NFL bankruptcy crisis”, Tyler Stahle, April 17, 2015