Why do professional athletes go broke? Former NBA player explains where the money goes

With the astronomical contracts being thrown around the NBA in the modern day, you would think that the league’s best players will be set for life after they retire. Many times that is far from the case.

Walker, Kemp and Rodman among many who spent it all

Some of the guys who used to dominate the league, and top the NBA rich lists are now scrapping by. Guys like former Boston Celtics scorer Antoine Walker, high flying Seattle Super Sonic, Shawn Kemp and Chicago Bulls bad boy Dennis Rodman used to live a lifestyle of fortune and fame, but are now pinching pennies after squandering their multi million dollar contracts.

Stanford graduate and former NBA player Josh Childress played 15 years of professional basketball between the US and overseas. After being drafted sixth overall by the Atlanta Hawks in 2004, he was lured away from the league by Greek giants Olympiacos in 2008. Childress grew to be a superstar in Europe and made the All-Euroleague Second Team. He would come back to the NBA before finishing the last leg of his career in Japan and Australia.

Childress made over $60 million over his career, and is one of the ex players who has saved money and living comfortably, which plenty of cash in the bank. From early on Childress understood that the $11.4 million rookie contract would go quicker than expected. After taxes and agent fees that eight figure contract gets dwindled. “You’ve got five [million dollars after taxes] over four years. So that million-dollar house that you thought you had $11 million, that you had $10 million more, that house then becomes more expensive.”

More money, more problems

It’s easy for a young player’s eyes to light up when signing that first check loaded with all those zeros. A lot of players dedicate their first few paychecks in buying homes or cars for family which can put them behind the eight ball off the bat.

“Most guys buy their mother a house or a car or something. They buy themselves a car. You’ve got a 2-to-4% agent fee. You got the NBA escrow. So that check gets eaten up.”

Once the cars and the homes and the family is taken care then there is the day to day life of an NBA star. Once you’re in the league, you either have games or practice, but aside from that your days, and nights are pretty wide open.

Watch out for those vets

It doesn’t matter what a person’s vice is. It could be partying, it could be golfing, it could be fine dinning at expensive restaurants. Once young players enter the league and start making money to fund those vices is when things can get complicated, especially if you’re influenced by some of the older vets who have deeper pockets and fatter contracts.

“Some of my veterans spent a little more than others,” Childress explained. “If those are the guys taking you under their wing, that’s what you get used to. So that’s how you think it has to be, and that’s how you think the life is, and you get caught up in that, and you end up spending way more than you should.”