Why do so many NFL players go bankrupt?

[Mc2guy]

Originally Posted by Schneed10

No, no. It's not at all. I have $100 million in the bank, I'll put it in safe investments. It earns 3%, so I make $3 million a year. I can spend $3 million a year and not lose any of my $100 million.

$3 million annually amounts to $250,000 monthly. I can have three big mortgage payments on three big homes throughout the country. I can buy a car each month. I can eat out whenever I want to. It's not hard to budget for that at all.

What's not easy is coming into $100 million. Every single intelligent person on this message board would handle $100 million A LOT better than these moron athletes.

You better be prepared to live off less than that chief. Uncle Sam and the state want their cut, which of $3,000,000 assuming you are using interest or dividends, not selling equity is taxed at standard income rates, so there goes 35%, plus SSI, plus state tax, so there is 50% out the door up front.

Oh yeah, did you have that money with an wealth management firm like a Schwab or Jones or Edelman, whoops, there goes another 1-2% in asset management fees, plus the fees from the mutual fund managers where your money is actually invested, which is another 1% minimum.

Wow, your 3% return just turned into a loss, all for a measly $1.5M in net cash flow.

Is it any wonder "rich" people don't put their money in MMA's or CD's. There is no return, which is why most people of "significant" wealth, have personal investment advisors/staff to carefully invest in both securities and equity projects. Holding on to wealth is not as easy as it sounds.

I would be willing to bet if you took a random sampling of 1000 Americans, pulled them off the street and handed them a check for $100M; 75% would be broke in 10 years or less. Most people simply are not prepared to handle that kind of money.