Former NBA Player Breaks Down Why Many Pro Athletes Go Broke After Leaving The League
It’s been reported that Jaylen Brown signed the largest contract in NBA history when he inked a $304 million deal with the Boston Celtics. Yes, that’s a lot of money, but even at a third of that, it is still a large amount of cash. Business Insider reposted a story from several years ago about a former NBA player who made over $60 million in his career. He discussed why so many professional athletes go broke after their playing days are over.
Josh Childress, who played on four different teams during his career, made more than $60 million after graduating from Stanford. He was able to avoid the financial pitfalls that many of his peers have fallen into. The thought process with most people who come into money after not having any is the perception that they have more in hand than reality.
“The first mistake is, people say, ‘Okay, I’ve got $11 million,'” Childress said. “You’ve got five [million dollars after taxes] over four years. So that million-dollar house that you thought you had $11 million, that you had $10 million more, that house then becomes more expensive. Most guys buy their mother a house or a car or something. They buy themselves a car. You’ve got a 2-to-4% agent fee. You got the NBA escrow. So that check gets eaten up.”
His saving grace was being around veteran players who were financially intelligent, allowing him to soak in their knowledge, as it could have gone the other way with the wrong influence.
“Some of my veterans spent a little more than others. If those are the guys taking you under their wing, that’s what you get used to. So that’s how you think it has to be, and that’s how you think the life is, and you get caught up in that, and you end up spending way more than you should.”
Luckily for him, he was able to curtail those thoughts and stay on the right track of being able to have money after his playing days were over.