Wayne County residents dealing with financial challenges in our struggling economy could perhaps be forgiven for the occasional daydreams of fame and fortune. If only one had the six, seven or eight-figure salary of a professional athlete, it would seem, bankruptcy would simply never be in the picture.
As it turns out, however, many of these athletes -- even promising young stars with the world seemingly at their fingertips -- are finding themselves filing for bankruptcy. The recent case of a former NBA star is illustrative. Just a teenager at the time, he signed a deal in the late nineties for just over $70 million, and was told by the coach that never again in his life would money be a worry for him.
In the years that followed, the young man made a number of high-ticket purchases, as one might expect. However, he also followed some bad advice about investments, particularly in real estate -- and Wayne County residents are all too familiar with the real estate market of recent years. The losses of those investments have now lead him to file for bankruptcy.
Financial challenges are actually more common for athletes than one might expect. They are often young individuals whose business education level is rarely commensurate with the sums they earn playing professionally. Some institutions are even starting up MBA programs specifically designed to help them manage their money, investing wisely and avoiding overwhelming debt.
Hard times, unfortunately, can befall just about anyone. Even those with solid financial resources can see a bad investment, a turn in the market or other unexpected life changes leave them struggling with unpaid bills. Bankruptcy offers the same fresh financial start across the board.
Source: Bloomberg Businessweek, "Basketball Star Who Went Bankrupt Wishes He'd Gotten an MBA," Akane Otani, Oct. 23, 2014