Going Broke

Over the last several years, former (and sometimes current) NFL players’ sob stories hit the newswire about bankruptcies and extreme financial difficulties. According to Sports Illustrated, 78% of NFL players are broke within two years of retiring from the NFL. This alarming rate of players going broke should catch the attention of agents. While agents often don’t have financial backgrounds (or incentives to care about their clients future success after retirement), they do know how money works and how to manage their finances. Often times, agents introduce their clients to knowledgeable financial advisers. However, these young athletes find it difficult to relate to or understand the appointed financial advisers.

Agents need to take note of this dangerous trend and be more proactive in helping their clients learn enough about personal finance to avoid disaster. Since most college athletes are not allowed to work while under scholarship, they are not used to having money to manage. After graduating college, some of these athletes sign multi-million dollar contracts with large signing bonuses. With no real financial management knowledge, these athletes can go from millionaires to being broke within a few months or years.

There are numerous reasons players go broke from overspending, not saving/investing, poor investments, premature retirement (injuries), divorces or not planning for their lives after football. Some athletes do plan for their futures but because contracts are not guaranteed, they find themselves unemployed and not cashing in on their contracts. These athletes need agents to step up and provide them with a financial education as well as post-career planning to ease them into new jobs after retiring from football. Some players become analysts, coaches, or work in the front office of a football team. Others find themselves clueless on what they will be doing upon retirement. If agents had a financial incentive to manage their clients’ lives after they retire from football, we might not have this dangerous trend in bankruptcies. The NFLPA has taken action by proving a financial management education but agents have the ability and responsibility to at least encourage their clients to think about their futures. Will the NFLPA be effective enough or will agents have to get more involved?