Another Riches to Rags Story

riches to ragsI can’t help it, but I find riches to rags stories quite amusing. Even though I’m certainly not the type to laugh at anyone’s misfortunes, riches to rags stories are certainly a huge laugh for me.

Fame has its rewards. Big money, fancy hotels, large wheels, expensive homes and trophy wives. Notice I said wives as in plural and a girl in between on the side in every town from New York to Vancouver. Certainly this type of lifestyle is what many strive towards, yet forget that a lot of it smoke in mirrors.

Living a larger than lifestyle has a high price tag. The road from riches to rags is much traveled, yet when you arrive at the destination of a fancy lifestyle it consumes most as it’s quite difficult to keep up with.

Last week I came across another riches to rags story from the world of football. Surprised? I didn’t think so. The latest to fall from the world of bling is Jevon Kearse. Once a former star defensive end with the Tennessee Titans and Philadelphia Eagles earned about $45 million over 11 seasons. Evidently, this wasn’t enough, because Jevon is broke and has IRS on his ass.

Just four years after retiring, the IRS put up a tax lien against him for $432,015 in back taxes. But it doesn’t end there. The bank that granted Jevon a $25-million mortgage filled  a lawsuit against him just a few months ago. He only purchased a 6,064 square foot home in 2004 for $6.5-million.

Seems like someone making big bucks like that wouldn’t need a mortgage, but in 2006 he took out a mortgage on that same 6,064 square foot home and that was just after he received a $16-million signing bonus from the Eagles.

This story is sad in one aspect, yet funny in another, but it illustrates the problems that befall many athletes. Studies have shown that a staggering 78% of NFL players go bankrupt or experience money problems within two years after the last payday. Similarly, 50% of NBA players go broke five years after retirement.

Reasons include bad investments, gambling, excessive lifestyles, multiples wives and/or girlfriends, greedy family members and friends, horrible financial advisors. But mostly why they go broke is due to to lack of proper planning for the future and life after retirement.

So, what’s the moral of the story?

The faster you rise, the faster you’ll fall. If you don’t plan for your own future, nobody else will. So, my dear friends if you haven’t started planning for your future it’s never too late to start.

Happy Saving!

Eddie

Comments

  1. Yeah, it’s tragic to see this happen so often that it’s become almost predictable. Like Hollywood marriages.

    As an investor my mind goes to this question: what do those people spend those millions on? Is that something I can invest in? Because it sure seems like it has a steady market of customers with, literally, more money than sense.

    I haven’t found the answer yet, but I’m still looking.
    William @ Drop Dead Money recently posted..The Economy: Where Are We? Q4/2012My Profile

  2. Christian L. says:

    Eddie,
    What a shame, right? Imagine what we could do with $45 million over 11 seasons. I’d like to believe I could exercise the self-control and discipline to manage this much money.

    But quite honestly, I have no interest in making that much money with that much fame. Clearly, it’s more of a risk than a reward.

    -Christian L. @ Smart Military Money

  3. Good post Eddie. It is sad to see, but also funny at times. There was an ESPN documentary on this a few months ago and it was giving the same insight. When many of these athletes make it they have all sorts of “friends” and “family” just come out of the woodwork wanting them to bankroll some crazy investment scheme. It just makes you wonder what some of them are thinking…or not thinking in this case.
    John S @ Frugal Rules recently posted..You Bought That at Walmart?!My Profile

  4. Professional athletes and others who suddenly become wealthy are illprepared. They did not do the work in college to prepare themselves for these kinds of things. They shoul dhave surreounded themselves with advisors who would look out for them. Instead, they spent all their money and end up brooke.
    krantcents recently posted..10 Things I Can’t Live Without!My Profile

    • They do surround them selves with advisors, but when you don’t know what you’re investing into, it doesn’t matter. That’s why advisors love guys like these. Uneducated, and a big payday for them.

  5. This makes me laugh and cry at the same time. Many athletes are like this. I just heard that Vince Young just got a loan for his birthday party. How stupid is that?
    Grayson @ Debt Roundup recently posted..Getting Out and Staying Out Of Credit Card DebtMy Profile

  6. Just goes to show It’s not about how much money you make it’s how you save or spend it. Silly really… these stories after all they had.
    Canadian Budget Binder recently posted..The Grocery Game Challenge #8 February 18-24, 2013~Buy Now or Buy LaterMy Profile

  7. Even though you’re not the kind of guy to laugh at other people’s misfortunes, you’re going to do it anyway?
    Nelson recently posted..Market Sense Is The BestMy Profile