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It's not their responsibility though. The player could take a course on their own initiative.

by test6554 9y ago

specialist 9y ago
Which courses do you recommend?
- WalterBright 9y ago
  I'd start with a course on basic accounting, which you can get at your local community college. It's critical to be able to read and understand a financial statement, and it's not that hard, either.
Jtsummers 9y ago
It doesn't need to be their responsibility, it is something they could do and wouldn't cost them much. If anything it could help with their recruiting efforts: Show a list of athletes that got screwed by shady advisors; show how they'll connect you with real advisors (at established and more trusted institutions) and education to discern what options are good and what aren't. Won't make a difference when tyring to get that top QB, but it may for all those guys who're only making $150k-300k.
ChuckMcM 9y ago
Its true they could. I think of it like auto repair shops. Here is something really valuable to your daily life, and you want it taken care of properly, but how do you verify that the person you are talking to is honest and trustworthy? You could buy the factory service manual for your car and read it cover to cover, with digressions into the parts which are assumed to be known by anyone servicing a vehicle, and then you could evaluate an auto mechanic's answers based on a ground truth of the service manual, but how many people actually do that? 1% ? 10% ? In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Using the 4% number (which used to be the standard before the great recession knocked it back to 2% for more conservative savers). One of the things that people usually don't think about deeply is that money in the bank pays you, things that you own cost you. A car needs gas, a jet needs maintenance, a home needs gardening. And when you scale up the 'thing' you scale up the cost. As a result if you live what you perceive to be a 'rich' life you may find its sucking your wealth away. There are lots of studies on lottery winners which show this effect.
- wutbrodo 9y ago
  > In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Wow that's depressing as hell. I've seen the spending side of things, but for a long time out of college I was making more money than anyone I knew and also spending towards the bottom of the distribution. I think I was 25 when my average return started covering my cost of living. My family didn't have much money growing up (due to medical reasons) and my parents don't really know much about managing money, probably because they both come from upper-class backgrounds where family money just seemed "taken care of". So I have to confess I'm not really sure where the financial irresponsibility of the sorts discussed in this post comes from. I'm tempted to say that it's a simply matter of high time preference, but that's a really self-serving explanation, so I'm not quite satisfied.
  - test6554 9y ago
    I feel the same. I have been in the top 2 to 3% income-wise but I spend money like I am on food stamps.
- thaumasiotes 9y ago
  > In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Nobody tries to keep their costs below their income? If I was suddenly wealthy, I'd try hard to make sure lifestyle spending was covered by growth in my wealth, not by drawing it down.
gech 9y ago
Everyone but myself be damned.

It's not their responsibility though. The player could take a course on their own initiative.

specialist 9y ago

Which courses do you recommend?

WalterBright 9y ago
I'd start with a course on basic accounting, which you can get at your local community college. It's critical to be able to read and understand a financial statement, and it's not that hard, either.

Jtsummers 9y ago

It doesn't need to be their responsibility, it is something they could do and wouldn't cost them much. If anything it could help with their recruiting efforts: Show a list of athletes that got screwed by shady advisors; show how they'll connect you with real advisors (at established and more trusted institutions) and education to discern what options are good and what aren't. Won't make a difference when tyring to get that top QB, but it may for all those guys who're only making $150k-300k.

ChuckMcM 9y ago

Its true they could. I think of it like auto repair shops. Here is something really valuable to your daily life, and you want it taken care of properly, but how do you verify that the person you are talking to is honest and trustworthy? You could buy the factory service manual for your car and read it cover to cover, with digressions into the parts which are assumed to be known by anyone servicing a vehicle, and then you could evaluate an auto mechanic's answers based on a ground truth of the service manual, but how many people actually do that? 1% ? 10% ? In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Using the 4% number (which used to be the standard before the great recession knocked it back to 2% for more conservative savers). One of the things that people usually don't think about deeply is that money in the bank pays you, things that you own cost you. A car needs gas, a jet needs maintenance, a home needs gardening. And when you scale up the 'thing' you scale up the cost. As a result if you live what you perceive to be a 'rich' life you may find its sucking your wealth away. There are lots of studies on lottery winners which show this effect.

wutbrodo 9y ago
> In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Wow that's depressing as hell. I've seen the spending side of things, but for a long time out of college I was making more money than anyone I knew and also spending towards the bottom of the distribution. I think I was 25 when my average return started covering my cost of living. My family didn't have much money growing up (due to medical reasons) and my parents don't really know much about managing money, probably because they both come from upper-class backgrounds where family money just seemed "taken care of". So I have to confess I'm not really sure where the financial irresponsibility of the sorts discussed in this post comes from. I'm tempted to say that it's a simply matter of high time preference, but that's a really self-serving explanation, so I'm not quite satisfied.
- test6554 9y ago
  I feel the same. I have been in the top 2 to 3% income-wise but I spend money like I am on food stamps.
thaumasiotes 9y ago
> In my experience in the Bay area with people who suddenly have more wealth than their friends and family ever did, there are two ways that people seem to split. Either they start splendiforus spending because they are "rich" or the start calculating what sort of 'burn rate' they can support drawing down at a rate of anywhere between 2% and 10% of their net worth. Nobody tries to keep their costs below their income? If I was suddenly wealthy, I'd try hard to make sure lifestyle spending was covered by growth in my wealth, not by drawing it down.

gech 9y ago

Everyone but myself be damned.