If you are a sports fan, you know the NFL Players Association and NFL Owners cannot come to a collective bargaining agreement, and players are essentially out of work until a new deal is in place.
The NFLPA has been warning players for two years that a lockout was possible, and that they should save accordingly so they can support themselves financially during the lockout. Unfortunately, it looks like many players didn’t heed that advice. Up to 30% of players are taking out high interest, short term loans to cover their expenses until an agreement is reached and they start getting paid again.
As you may know, I have no problem with athlete salaries. (or teacher salaries for that matter) I also have no problem with these high interest loans. Heck, if I had enough money to offer a big loan with a super high interest rate to someone that I have good reason to believe is going to be paid millions of dollars in the next few months (the lockout will end before the season starts, mark my words), I’d be on the phone with as many NFL players as possible offering up my services.
Let’s look at the facts:
- The minimum NFL salary is $340,000 a year, and some make tens of millions a year. The only reason any NFL player (even those making the minimum) would need a loan to pay his bills is if he has made bad decisions.
- The players have known a lockout was a possibility for years. Their own union did everything they could to encourage players to save money in case they found themselves in today’s situation.
- The union will pay players up to a maximum of $60,000 to help them cover expenses, with payments starting at the end of this week. Once again, the only way $60k doesn’t cover your bills is if you’ve been spending like an idiot.
- NFL players are adults. The youngest NFL player ever was 20 when he played his first game. Most players are at least 21 or 22 before they enter the league. If they aren’t smart enough to handle their own money, or pay someone to do it for them, it is their own fault.
We love to pass off blame in our society. You could argue that it’s the owners’ faults for not providing players with financial advisers. You could argue that the union should have done more to prepare them for the lockout. You could argue that these predatory lenders are evil for taking advantage of people in a bad situation.
I’m not buying it. Every NFL player is an adult. He is responsible for his financial decisions. If he wasted his money, that was his decision. If someone offers him a loan at 25% APR and he takes it, that is his decision.
The players not victims of NFL owners, lenders, or anyone else. These NFL players are only victims of their own actions.
What do you think? Would you give an NFL player a high interest loan if you had the money? Are these lenders “bad guys”?
Kevin McKee is an entrepreneur, IT guru, and personal finance leader. In addition to his writing, Kevin is the head of IT at Buildingstars, Co-Founder of Padmission, and organizer of Laravel STL. He is also the creator of www.contributetoopensource.com. When he’s not working, Kevin enjoys podcasting about movies and spending time with his wife and four children.
I think it’s unfortunate that these NFL players making millions of dollars put themselves in this situation. They shouldn’t need to take out high interest loans to cover expenses. If they properly planned and weren’t spending on unnecessary things, they would be fine financially. In fact, their kids and future grand kids should be fine financially!
That said, let’s face it….. A lot of these guys making millions of dollars didn’t pay attention to much in their lives other than football. They probably weren’t taught financial responsibility, they probably didn’t go to class in college (not that they would learn financial responsibility there either), and many of them seem to fall for these “investment” opportunities that end up being scams.
I do think there is a serious problem where people graduate high school or college with no finance knowledge. With that being said, I know for a fact that the NFL tells rookies that they should get a financial planner. These guys know they should have a financial planner, and they have to money to pay one.
Would I give these guys a high interest loan? You bet – easy money for me once the strike is over! Do I think they are idiots for not having even a little bit of savings set aside? You bet! Am I surprised… not in the least.
I know! If only I had a few million!
Diddo to everything Denise said! I do feel a little bit sorry for kids and teenagers who were just never taught about finances and don’t know about or have the resources to teach themselves, but these athletes could take a class or get a tutor or talk to someone about savings at any point and choose not to. That’s on them.
If nothing else, we just learned 30% of NFL players are stupid.
I would totally lend them money. Let’s keep Propser.com hidden from them.
Yeah, it’s also sad that they don’t even know of other options. They are probably all just going to these loan sharks. They really do need some education.
Oh Yeah! The NFL players should take responsibility for their finance.
Here is a somewhat unrelated story. A couple I know decided to go live in Italy for a year and put their condo up for rent. The renter turn out to be an NFL linebacker (probably reserve) and he took good care of the place for a year. This is a smart NFL player and he knows his shelf life is pretty short so he doesn’t spend a lot of money on housing. There are some financially savvy players too. 😉
Yeah, I remember reading an article about an NFL player who worked at Applebee’s in the offseason because, as he put it, “diapers are expensive”. That was a great story.
Kevin,
I think your a little harsh on the players. They’re extremely good athletes, and throughout high school and college this is what they focused on. They all had to work pretty hard to get to the NFL, so they may lack excellence in other areas such as personal finance. I say give them a break, they are always under constant pressure from their relatives and hometown friends.
They don’t have to be excellent at personal finance. As soon as they enter the NFL, the league puts them through a 3-day rookie symposium where veteran players tell them that they should get a financial advisor. Money should be the easiest thing in their lives; they have the money to pay someone to manage it, and they know they should because each and every one of them are told to get help.