Spending the windfall
Few things rankle people quite like professional athletes going bankrupt. To us, it doesn’t make sense. Where does all the money go? How could they spend all of it? How can I budget a $50,000/year salary, and they let millions slip away? Two years ago, Sports Illustrated reported 78 percent of NFL players “have gone bankrupt or are under financial stress because of joblessness or divorce” two years after retirement.
And by all accounts, nothing has really changed. A recent report from ThePostGame.com, a Yahoo! Sports subsidiary, stated that players from 16 teams had already sought out “extremely aggressive short-term loans” with interest rates ranging from 18-26 percent — and some with 36-percent rates upon default.
It’s OK to shake your head. It’s OK to chide these players for not saving their money. It’s OK to say you wouldn’t be in this situation. But before you get mad — before you get really angry — and say the underpaid teachers and social workers and police officers wouldn’t ever be in a similar predicament, you need to understand the system.
Most professional football players are the product of a broken system. It’s a system that hands them a football scholarship to an academic institution, and expects them to understand how to properly take advantage of higher education. It’s a system in which players go from being college students to instant millionaires, and then expects them to save their money. It’s a system that dictates everyday on the field is a job interview and expects kids to stay four years to get a degree.
I’m making a few generalizations, of course. Not all NFL players are bored by academics. Not all NFL players are misguided in their attempts to plan and save and invest their money. And not all NFL players are disinterested in preparing for a life without football.
But a lot of them are, because almost eight of out every 10 can’t stay from going broke only two years out of the league.
Whenever I talk to college athletic directors, they always use the term “student-athlete.” And most of the time, I just want to laugh. If a football superstar has aspirations for a professional career, football is his education. It’s just not politically correct to say so. After all, 90,000 fans don’t show up to athletes’ Financial Management lecture to make sure they’re engaged in the material, but 90,000 fans do cheer and critique, applaud and analyze their every move on Saturdays.
Less than 2 percent of high school athletes — and 1 in every 14,000 people — become professional athletes. They’re rare breeds. They’re the best of the best. They’re statistical anomalies that are training for their world, not ours.
They have been told from a young age that they’re different, they’re talented, they’re special. There’s nothing wrong with this. Oftentimes, they are different, they are talented, they are special.
But this system almost predisposes itself to failure. Because you can’t say, “You’re different, you’re talented, you’re special — and you’re so special that we’re going to spend a No. 1 pick and millions of dollars on you,” and then expect a 20-something-year-old kid to save his money. It’s just not going to happen.
Clearly, it’s not going to happen if players from 16 teams have already received short-term, high-interest loans — and the lockout has only been in effect for a month. Take, for example, this Rocket Ismail quote from the aforementioned Sports Illustrated article: “I once had a meeting with J.P. Morgan, and it was literally like listening to Charlie Brown’s teacher.”
It’s not the money or the financial advisors or the agents that have failed these players. No, it’s the system that expects a session at the rookie symposium to deter players from spending their millions. It’s the system that assumes a stint at a university will prepare players for the “real world” — as if they have some concept of what the “real world” is like. It’s a system that only pays its players during the season, and then is shocked when the money runs dry in the offseason.
The owners and the union — at least what’s left of the union — are squabbling over a couple hundred million dollars right now. Dressed in thousand-dollar suits, they’re occupying courtrooms and sitting at conference tables trying to get the best deal for their side. They’re trying to end the lockout.
Meanwhile, NFL players are still going broke — and the system is broken. Maybe it’s about time someone decides to fix it.
Scott Miller is a senior at The University of Iowa and a contributor to the National Football Post. Follow him on Twitter: @stmillr.