Why so many NBA players go broke?
Why do so many NBA players break? It’s a question that’s been asked for years, and has gained new urgency following the recent news that former NBA All-Star Antoine Walker has filed for bankruptcy.
The answer is complex, but it boils down to two main factors: the high cost of being an NBA player and the low rate of financial literacy among NBA players.
The average salary of an NBA player is $5.15 million per year, according to Spotrac.com. But the cost of living in the NBA lifestyle is even higher. Many players spend lavishly on cars, clothes, jewelry and other luxury items. They also often give generously to family and friends.
Meanwhile, the financial decisions NBA players make are often wrong. They invest in risky businesses without doing their homework, or they fail to plan for retirement even though they know their playing days are numbered.
And when they do retire, NBA players face some unique financial challenges. Their income from pension and disability is relatively low compared to their salary while they were playing. And the cost of health care is sky high for many retired players who have chronic injuries from their years in the league.
So what can be done to help NBA players avoid being broke? For starters, more needs to be done to teach them about money management before they enter the league. And once in the league, players need better access to financial advisors who can help them have a voice
The high price of being an NBA player.
The average NBA player salary is $7.7 million per year, according to the 2018-19 National Basketball Players Association (NBPA) report. This figure does not include income from endorsements or other sources of income. The highest paid player in the NBA is Stephen Curry, who earns a salary of $37.4 million a year. The lowest paid player in the NBA is J.J. Braa, who earns a salary of 1.4 million dollars a year.
The cost of living in the NBA lifestyle.
While the average salary of an NBA player is high, the cost of living in the NBA lifestyle can be even higher. For example, many players choose to live in luxury apartments or houses, the maintenance of which may cost tens of thousands of dollars a month. In addition, players often travel by private jet or first class airline tickets, which can add up to thousands of dollars per trip. And then there are the costs involved in hosting friends and family, which can include everything from game and concert tickets to expensive dinners and nights out on the town.
The low rate of financial literacy among NBA players.
Many NBA players make poor financial decisions. They buy expensive cars and houses, and they often invest in risky business ventures. As a result, they often find themselves in debt and struggling to make ends meet.
The role of financial advisors in the NBA.
Financial advisors can play a vital role in helping NBA players manage their money. However, many players are reluctant to ask for help, believing they can handle their finances on their own. As a result, many players make bad decisions that can lead to financial ruin.
The financial challenges NBA players face in retirement.
NBA players are not eligible for Social Security benefits, so they must rely on their NBA pension and any other retirement savings they have to support themselves in retirement. The average NBA player’s pension is only $43,000 per year, which is not enough to live comfortably. In addition, many NBA players are disabled and unable to work, so they rely on limited income from the NBA. However, this income is often not enough to cover the costs of medical care and other living expenses.
The cost of healthcare for NBA players.
Healthcare costs are a major financial challenge for retired NBA players. Many players have chronic injuries that require expensive medical care. Additionally, the cost of health insurance is high for retired NBA players because they are not eligible for Medicare until they reach age 65. As a result, many retired NBA players struggle to pay for their health care costs and end up facing significant financial challenges in retirement.
Conclusion
The high cost of being an NBA player can lead to financial difficulties in retirement. NBA players earn an average salary of $5.15 million, but the cost of living in the NBA lifestyle can be even higher. Many players are financially illiterate and make poor decisions with their money. Financial advisors can help players make better decisions, but ultimately it’s up to the player to manage their finances responsibly.