How should athletes manage their money?

The rookies of the Indiana Colts. Jon Peterson of Next Level Financial Group says that in the end, new NFL recruits are just 20-year-old kids.

For the average American, we save up for a home and retirement. For athletes, that process is reversed; they start out with enough money to buy a house and retire comfortably. But many athletes fall into bankruptcy and financial ruin, like NFL legend Warren Sapp. So how does all that money disappear?

Jon Peterson has been advising professional athletes about their finances for more than two decades. He's a registered principal with Next Level Financial Group in Sausalito, Calif. and currently represents 65 NFL players. He says that, in the end, new recruits are just "20-year-old kids," who just moved away from home and got their first job. That first paycheck may seem endless to them, but they have to realize it's not. Athletes are particularly vulnerable to hefty pay cuts, due to injuries. Peterson says he advises his clients to figure out a budget and stick with it.

He also says that players need to keep a close eye on their money -- something Warren Sapp said he wished he did. New "friends" and family members will come out of the woodwork to take advantage of the new wealth. If a player wants to invest his money into a business, they need to do their legwork on who the partner is and what the venture is.

About the author

Tess Vigeland is the host of Marketplace Money, where she takes a deep dive into why we do what we do with our money.
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I am a big fan of marketplace, but how does a story about an individual who made $60 million help us listeners to make better decisions in managing our money? I am frankly not in a position to blow massive amounts of money as Mr. Sapp has, therefore I cannot relate at all to this absurd story. As a teacher on a modest income, I put away small amounts of money every month toward my retirement and I appreciate sound advice on how to better grow my savings. The story about Mr. Sapp was absolutely useless in providing advice. What I take away is this: if I ever make $60 million I should spend it wisely so as to not go bankrupt. How about a story for those of us who are responsible with our money and would like to do better?

Why the heck should I care how overpaid athletes (mis)manage their millions? Call me petty, but I fail to feel compassion for having fallen to 'only' a million dollars ...

I'm very dissapointed with your interview with Mr. Sapp. You didn't even ask him why he didn't fall back on his "high quality" free education from Miami to get a job and pay his bills. I think a more prudent conversation for your show would have been why more deserving "students" are graduating college with six figure debts to pay off and high profile "Athletes" are going on to blow millions and then file bankruptcy with no student loans to worry about.
I expect more from a program that stresses financial literacy, and invests so much time interviewing people and responding to questions about paying for college and repaying student loans.

You know don't you that Northwestern University has a contract with professional sports leagues and gives yearly "finance management" seminars to incoming pros?

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