I just read an article that was referencing an original Sports Illustrated piece that detailed a shocking statistic: Within two years, 78% of NFL players are either bankrupt or facing severe financial hardship. The article points out that the starting salary of even the lowest NFL player is $310,000 and then jumps to $460,000 in year two. The latter figure puts these players in the top 1% of income in the United States according to the Federal Reserve data. How on earth could they be going broke? That's obscene.
The fact that so much of NFL player wealth is invested in real estate doesn't help either, the authors argue. They have a point. (What's the first thing you see a newly signed player do? Buy a house for themselves and their mom.) The piece also points to a Business Insider article that says having a higher-than-average number of children by different women is also a problem. Case in point: "Take the example of former NFL player Travis Henry. The NYT reported recently that Henry, 30, a former N.F.L. running back who played for three teams from 2001 to 2007, has nine children — each by a different mother, some born as closely as a few months apart. Henry says he's broke, and cannot afford the estimated $170,000 in child support he owes per year. Or boxing champion Evander Holyfield. As the AJC notes, Holyfield has grossed more than $248 million in the ring, but also come close to losing his Atlanta home because of child support payments believed to total $500,000 annually -- on top of two divorces and several failed business ventures."
Doesn't everyone know you never touch the principal! It's so unbelievably simple. If you do your job right, you can live off interest income and dividend checks for the rest of your life, without lifting a finger. This is just tragic.