Elite Sportsmen In Bankruptcy: Did you know that elite athletes fall more often than you think in situations of bankruptcy ? The organization of charitable character XPRO Life After Sport , whose main objective is to offer help, support and advice to those professional football players who have played in the UK and Ireland, has warned of the high level of vulnerability experienced by players to leave their profession .
Among all the activities included in this organization, we can highlight the following: medical assistance, financial advice, legal representation, workshops and educational courses and employment exchange. All this is aimed at filling certain deficiencies that can lead to bankruptcy and a precarious personal situation.
What is certain is that a study published by XPRO Life After Sport reveals that about 60% of football players are in a ruinous situation at 5 years of hanging up his boots . Much of the population will be surprised that players with stratospheric wages end up in utter economic misery. People with normal wages are unable to spend so much money in such a short time, but experience shows that it can and, in fact, is much more frequent than we thought at first.
In the same vein, other studies focused on players from the NFL (National Basketball League) or NBA (National Basketball Association) who, in other temporal and percentage ranges, state that most professional athletes end up ruined in a few years.
Bankruptcy In Football Players, Why Is It Produced?
In any family economy, when the expenses exceed the income over a certain period, the alarms go off. It is necessary to reduce the expenses to fit the budget and to avoid getting into debt. In the case of footballers is exactly the same. Must start from the premise that people are young, very young, have handled huge amounts of money and have taken a very high standard of living , according to the revenue generated them their contracts. But at the time when a player retires, the cash flow ends, while it tends to perpetuate the living standards that had previously .
While it is true that some players continue to generate cash through their investments, not everyone is so lucky, as they have either made very poor investments or barely saved money during their professional career. To this must be added the fact that a good number of players have left school at an early age to devote himself exclusively to elite sport . In this way, the young athlete bets all his future to a letter, without reserving alternative ways in case of failure.
Main Causes Of Bankruptcy Or Bankruptcy
Purchase of assets with a very limited useful life and rapid depreciation
There are assets, such as cars or high-end watches that, having acquired them, immediately lose a significant part of their economic value. When selling in the second-hand market, a price close to the amount disbursed for acquisition is seldom achieved. Some of these assets require very important maintenance and / or associated expenses that drain the owner’s estate continuously.
It may be a cliché, but many elite athletes end up ruined because they have made very bad investments, many of them advised by clear conflict of interest advisers. Knowing the asset in which you invest and obtaining neutral advice are two of the keys to avoiding a quick bankruptcy.
A traditional investments in stock markets and real estate ( Real Estate ), must be added the investment in Set-Ups , companies and vehicle marked technological character that many athletes are using the time to invest part of their income. Great athletes like Cristiano Ronaldo and Gerard Pique spend a part of their salary to create an investment portfolio that allows them to continue their standard of living after retirement sport.
Other players , like Victor Valdes (FC Barcelona former goalkeeper), have not been so lucky in their investments, mainly real estate in this case, and have lost significant amounts of capital . This last example is very illustrative, since next to the failure investor was united an important physical injury that has prevented him to yield to the level of old. Consequently, the income derived from its sporting activity has also been diminished.
Divorce And Bad Company
Professional footballers are still human and therefore suffer the same problems as many other citizens. The economic downturn that produces a divorce can trigger a precarious economic situation, especially if the couple has children together .
The poor economic situation of a former athlete can be the catalyst for subsequent social and family problems, as the athlete’s environment has become accustomed to a standard of living far superior to what they can effectively carry.
Many athletes are not able to differentiate between those people who approach them for the sake of those who do not, which has sometimes caused psychological problems for these young people when realizing that their environment was full of entertainers and interested.
How To Prevent Footballers From Going Bankrupt?
The solution of the problem lies in the financial education of the athlete , providing it with the necessary tools and knowledge so you can understand what their economic situation and the impact of major operations.
It is true that the athlete should focus on the exercise of his activity and can not supervise all the details, but he must be able to know the scope and possible consequences of their operations.
In this way, a drama that, incredible as it may seem, negatively affects many of the young people who focus their life on the sport and, after his career, do not have an alternative escape route.
Some sports clubs encourage young athletes from their quarries continue their studies , something that must be internalized by the organization of sports organizations to avoid ruining the future of much of their athletes.