Nearly one out of six NFL players will declare bankruptcy within 12 years of retiring from the league, a shocking new study has revealed.
The rate of bankruptcy, 15.7 percent – remained the same no matter how long the players were in the league or how well they were paid, according to researchers from the California Institute of Technology, George Washington University and the University of Washington.
Despite earning millions of dollars – sometimes tens of millions – former players go broke at about 1.1 percent per year, the same rate as the rest of Americans.
Though bleak, the 15.7 percent figure found by the researchers, is dramatically lower than a widely quoted statistic that 78 percent of retired players are bankrupt or under ‘financial stress’ within two years of leaving the league. The figure comes from a 2009 survey by Sports Illustrated.
Often, when athletes go broke, it’s because of unimaginable extravagances, bad investments and massive child support payments. This, despite the fact that the average player makes $3.2million over the course of a career.
Defensive tackle Warren Sapp played 13 seasons in the NFL and made more than $82million. He retired in 2007 and filed for bankruptcy in 2012 – citing several failed business ventures.
When his estate was sold at auction, he had a lionskin rug and 240 pairs of sneakers. He also owed more than $75,000 a month in child support for his six children (with five different women,)
Quarterback Vince Young’s played his last NFL game in December 2011. He filed for bankruptcy in January 2014 – despite earning $34million in salary and another $30million in endorsement deals.
Widely reported rumors that emerged after he first began having financial trouble in 2012 claim that he spent up to $5,000 a week at Cheesecake Factory and racked up a $6,000 tab at TGI Friday’s.
Young also blamed investment advisers who he claimed took advantage of him.
Quarterback Michael Vick filed for bankruptcy in 2008 – in the middle of his high-profile career and legal troubles that sent him to prison. He was still paying off his $18million in debts in 2014 – despite making $130million from the NFL and millions more from endorsement deals.
‘We’ve known that it can be very difficult for the average family to save,’ Cal Tech finance professor Colin F. Camerer, one of the researchers, told the Washington Post.
‘But this is one group that you might think ought to be able to avoid bankruptcy. They’re in a position to buy some good advice if they need it. But even for them, with all these millions, it’s a challenge.’