"Financial literacy" is a popular term being thrown around these days. It basically refers to having some awareness of how money works, especially with regard to personal finance. While the phrase itself is decades old, plenty of people are still not getting the memo. There are some very simple ideas that sum up financial literacy. They include not spending more than one earns, not accumulating unreasonable debt for frivolous things and making sure to save money for emergency and invest money for the future. All simple concepts, right? Well, it remains baffling how many people refuse to catch on to these lessons.
It is no surprise that normal people go broke due to financial ignorance. We all know of someone who got a high-paying job, tried to vastly upgrade his or her lifestyle, and promptly got fired; losing everything and having to move back in with mom. It is a surprise however, that athletes continue to go broke. Actually, it should be a surprise, but it no longer is. A two day seminar on investing and an afternoon of discussion on the topic of spending and debt would probably prevent some of these people from making bad decisions with money, but who wants to sit through that?
While not all of these athletes have actually gone full-on broke, all have made poor financial decisions that have set them back. Here are fifteen formerly prominent athletes who and their examples of financial ignorance.
15 Johnny Unitas - Bad Business Investment
Widely considered to be one of the greatest quarterbacks in the history of the game, and a pioneer in the development of the passing-centered offense, Johnny Unitas had an incredible career. His time in the league spanned three teams, the Pittsburgh Steelers, Baltimore Colts and finally a single year with the San Diego Chargers. It was with the Colts that he was selected to the Pro Bowl ten times, with seven All-Pro honors and three NFL Championships.
14 Diego Maradona - Taxes
The first of a couple of athletes who "forgot" to pay their taxes, Diego Maradona, one of Argentina's greatest soccer stars, found out back in 2009 that he owed nearly 40 million Euro in back taxes.
13 Sheryl Swoopes - Poor Investments
She can't dunk, but she has excellent fundamentals. Sheryl Swoopes is considered one of the greatest players in the history of the WNBA, and the first player signed to the league. If you got the Futurama reference, you should be proud and you can be our friend.
12 Lawrence Taylor - Drugs and Spending
If you've seen Oliver Stone's football film Any Given Sunday then you already have some good background knowledge for this story. Lawrence Taylor (who played Shark, the inside linebacker in the film), essentially played himself. The "play-through-the-pain" attitude, the drug use, and the spending habits, were all realities of his later career and life after football.
11 Lenny Dykstra - Criminal Activity
It doesn't matter if you're an All-Star, Silver Slugger award recipient, and/or a World Series winner; you run a business as poorly and illegally as Lenny Dykstra, you will not last long. The Mets/Phillies outfielder started some businesses after his career had ended. He started a jet charter company and a magazine. He talked a big game and walked a big game, but ultimately, his businesses and their supposed prosperity ended up being a complete house of cards.
10 Derrick Coleman - Puked His Money into a Pit Called Detroit (Sorry, Detroit)
9 Curt Schilling - Video Games
8 Evander Holyfield - Gambling and Kids
One of boxing's greats, Evander Holyfield had an estimated net worth of up around 150 million pounds while competing. He is now known for his charitable side and regularly feeds the homeless back in Manchester, England. For a few years there however, he was in financially dire straights.
7 Scottie Pippen - Poor Planning
6 Charles Barkley - Gambling
5 Michael Vick - Dog Fighting Case
From one of the most exciting players in the National Football League to a pariah even years after doing prison time, Michael Vick's career, and the hatred he still endures even today, shows exactly how much people love dogs. Michael Vick grew up in a culture that didn't consider dog fighting to be all that heinous and he and his friends continued to enjoy the terrible act into their adult lives. They paid the price and Vick tried to downplay his own involvement with little success.
4 Kenny Anderson - Bad Investments
A fourteen year veteran of the NBA, Kenny Anderson has pretty much lost all of the $200 million he made (salary and endorsements, according to his ex-wife) throughout his career. He worked as a basketball coach for a Jewish private high school in Florida for a while but lost his job after a DUI. So, sadly, the bad decisions have continued.
3 John Elway - Ponzi Scheme
Two time Super Bowl winner and current GM of the Denver Broncos, John Elway is our number three. He is known to have entrepreneurial interests outside of football and owns both restaurants and car dealerships. He got taken for a ride about ten years ago by a scammer named Sean Mueller. Mueller is now serving a lengthy sentence for a few counts of racketeering, fraud and theft. You know that saying "if it sounds too good to be true, it might be?" Well, this is exactly what that phrase is talking about.
2 Tiger Woods - Got Caught Cheating
There are tons of lessons that can be learned from Tiger Woods' scandal. He should have kept his cell phone better hidden or had several, one of which sat in a safe that he kept within a bigger safe that he kept in a dark corner of a room his wife didn't know about. He also should have not cheated in the first place and if he had a wandering eye before they were married, he probably shouldn't have gotten hitched at all. But I digress.
1 Mike Tyson - Lifestyle/Spending
In case you haven't noticed, the worst mistake a person can make with regard to their finances is spending too much. If it's old news to you that a person should not spend more than they have coming in, congratulations, you have a shred of financial intelligence and your parents should be proud.
At one point, Iron Mike had over $400 million to his name. In the mid 2000s however, he was in tens of millions of dollars in debt. An entourage consisting of hundreds of people, along with several millions of dollars worth of cars, clothing, jewelry, tigers and a trainer for the tigers comprise a short list of thinks at which he shoveled money. His drug habit didn't help the situation of course, but whether high or not, Tyson was a train wreck for a few years, belching money at stupid purchase after stupid purchase. He stands as a shining example of why parents need to teach their children about money as early as possible.
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