On September 25, 2014, Derek Jeter, longtime New York Yankee shortstop and team captain, drove in the winning run in his last at bat at Yankee Stadium. Three days later he was fully retired. He did so on his own terms, ending on a high note, still competing to the best of his ability, still regarded with affection and respect by teammates and fans alike. He has a charitable foundation; he’s building a large house in Tampa; he may start a family; he says one day he would like to own a baseball team. As a multi-millionaire and as someone who appears reasonable and intelligent, his chances of success are pretty good.
The image of Jeter rounding first base, hands held high in jubilation as the winning run scored will remain fixed in many a fan’s memory. But another, more poignant image, haunts my mind: that of the great world heavyweight champion boxer, Joe Lewis, another American athletic icon of a different era, standing in front of Caesars Palace in Las Vegas, serving as a paid “greeter,” shaking hands with guests, obviously uncomfortable and embarrassed. How did Joe Lewis, whose winnings totaled almost 5 million dollars (an enormous sum in the 1940s and 1950s), wind up broke, hounded by the IRS for unpaid taxes and having to sell himself to make a few bucks as a sort of a sideshow?
Unfortunately, transition to successful retirement is often problematic for professional athletes, and stories of financial and emotional ruin are all too frequent. Professional competitors, especially in the last several decades of multi-million dollar salaries, rich and famous at an early age, find themselves unable to cope with the realities of normal existence once out of the spotlight and once their paychecks have disappeared. Some find success in second careers while some are able to retire to a life of golf, family, travel and leisure. But others, the broke athletes—through bad decisions, divorces, addictions, health problems, criminal convictions, extravagant spending, bad advice or simple bad luck—fail miserably.
Most of us ease into retirement when we feel the time is right: financially, emotionally and physically. Just about all professional athletes, however, are obliged to leave their professions at a relatively young age. What transpires when these talented individuals give up their careers at an age when most working folks are just hitting their stride? What does the future hold for them? How, if at all, can they control their fates? And what can we, who enter our second act at a more appropriate age, learn from the failures of athletes that went broke, as well as the successful transitions of others?
Stories of former professional athletes that went broke are well known and all too common. In 2012, ESPN aired a documentary entitled Broke, which chronicled the financial, medical and emotional difficulties of dozens of former stars. According to the film (and based on a 2009 Sports Illustrated survey), a staggering 78 percent of former NFL players filed for bankruptcy or faced dire financial circumstances within two years of ending their careers, as did 60 percent of retired NBA players five years after retirement.
While most professional leagues today offer counseling and financial advice to their players, the factors that contribute to post-career complications are still current. Athletes generally enter their profession right after college or without a university education; they lack any sort of business or real-life experience, and they are often surrounded by a coterie of “advisors” who do not always have their best interests at heart, or by sycophants who only make matters worse. As many of the experts interviewed for the documentary point out, when very young men and women suddenly come into hundreds of thousands (in many cases millions) of dollars, their first priority is not generally long-time financial planning. Understandably, their impulse is to spend—and to spend lavishly.
Broke makes for fascinating, if depressing, viewing. The golfer, John Daly, tells of losing close to $50 million gambling; Bernie Kosar, star quarterback for the Cleveland Browns, declares at one point that he was supporting 40 families; Andre Rison, NFL running back, estimates he spent one million dollars on jewelry and $50,000 on clothes. “I didn’t have a money problem,” Rison declared, “I had a spending problem.” Keith McCants, a first-round draft choice for the Tampa Bay Buccaneers in 1990, made $7.6 million over four years, but was another broke athlete two years after retirement, a victim of drug addiction.
Interestingly, of all the athletes featured in the documentary, none was female, and only two of the dozens included in the list of those who had declared bankruptcy were women. And while female athletes typically fare better in retirement than their male counterparts, they too often have difficulty.
Dorothy Hamill, the champion figure skater and winner of the gold medal in the 1976 Olympics, wound up broke after investing in the Ice Capades, the entertainment extravaganza that eventually folded. She recently appeared on (what else?) Dancing with the Stars. Marion Jones, the former world champion track and field star and former professional basketball player who won three gold medals at the 2000 Olympics, was subsequently stripped of her titles after admitting the use of illegal performance enhancing drugs. She later served jail time both for her involvement in the doping scheme and for a check cashing fraud conviction.
Nevertheless, professional female athletes, more so than men, seem to embrace and even look forward to retirement. In a 1998 survey of retired women tennis players, for example, more than 50 percent indicated a sense of relief upon ending their careers. The majority also stated that they experienced an increased feeling of satisfaction and “stability” once they left their athletic careers behind.
Broke understandably concentrates on the failures of recently retired professional athletes, as it’s only been in the last few decades that professional athletes have earned such exorbitant sums. (The latest figures for average annual player salaries in the three major American sports leagues are staggering: approximately 5 million for both the NFL and NBA, and 3.5 million for MLB players.)
In the first half of the 20th century and largely up until the 1970s and 1980s, salaries—especially for the lower tier players—were modest. Most professional athletes were obliged to work in the off-season in order to make ends meet as car salesmen, insurance agents, bartenders, small businessmen, farmers and construction workers. It might have made their lives more difficult at the time, but it often made the transition to their second act easier and more natural. Many, in fact, earned a good deal more in retirement than they did during their playing careers. George Foreman, the boxing great, now in his mid-sixties, became involved in several successful business ventures, most notably his deal with Salton to promote the George Foreman Lean Mean Grilling Machine, which eventually earned him more than 200 million dollars, far eclipsing his earnings in the ring. Jim Brown, one of the all-time great running backs in the NFL, went on to have a successful acting career long after his life as a football player ended. Rodger Staubach, former all-pro quarterback, built a real estate empire that is today worth millions—many more times his NFL salary. (As a rookie in 1970, Staubach’s annual salary was $23,000.)
Several former athletes have embraced second careers as lawyers, doctors, dentists and even academicians. Frank Ryan, a star quarterback in the NFL from the late 1950s and throughout the 1960s, received his Ph.D. in mathematics (while competing) and taught at several universities both during and after his career as a professional football player. Dr. Randy Gregg spent 10 seasons in the NHL in the 1980s, attended medical school, moonlighted as a physician and famously diagnosed his teammate’s appendicitis. Hall of Fame golfer, Cary Middlecoff, Cy Young award-winning pitcher Jim Lonborg and quarterback Billy Cannon all became licensed dentists. Others went to law school, most notably, Alan Page—star lineman for the Minnesota Vikings—who in 1992 was elected to the Minnesota Supreme Court, becoming the first African-American to serve on that court.
Many athletes find employment in their former sport as coaches, managers, executives or as television/radio commentators. Several high profile former players have even transitioned into the realm of team ownership. Nolan Ryan—the Hall of Fame pitcher—was the CEO of the Texas Rangers. Magic Johnson is now the majority owner of the Los Angeles Dodgers and spends his time as a baseball executive. Michael Jordan is the chief owner and executive officer of the recently renamed Charlotte Hornets (formerly the Bobcats). The Williams sisters—Serena and Venus—who have dominated women’s professional tennis for more than a decade, are now part owners of the Miami Dolphins, becoming the first African-American women to obtain ownership in a major professional sports franchise.
A number of retired athletes have had successful careers in politics. Among the most prominent are Bill Bradley (former NBA all-star and senator from New Jersey), Jack Kemp (star quarterback for the Buffalo Bills, former congressman and candidate for Vice President), Dave Bing (NBA great and former mayor of Detroit), Heath Shuler (NFL quarterback and until recently a representative from North Carolina), Jim Bunning (MLB Hall of Fame inductee and former senator from Kentucky) and of course Arnold Schwarzenegger (professional body builder and governor of California).
In spite of the statistics cited by Sports Illustrated and underscored in Broke, there are in fact more stories of success than there are of athletes that went broke. But given our thirst for the sensational and the media’s eagerness to quench that thirst, we tend to notice most those former professional athletes who serve prison time, become addicted to drugs or alcohol, abuse their spouses, wind up bankrupt or suffer severe depression and tragically end their lives through suicide. Their stories evoke sadness: so much talent squandered, so much wealth and good fortune lost. Their failures remind us of the failures of those tragic heroes from ancient Greek drama whose downfalls—although self motivated, predictable and cathartic—are nevertheless, well, tragic.
So what is the lesson here? What can we, mere mortals nearing retirement with maybe a pension or a 403(b) that is a fraction of a NFL rookie’s annual salary, learn from all this? To begin with, the same advice we would give to retiring athletes no matter how young or how wealthy, is the same advice we have been hearing from financial advisors, friends, parents and spouses for years: invest wisely, don’t bet your money on fly-by-night schemes, associate with the right people and spend judiciously. It’s sound counsel for us and would be for them as well. Whether saying goodbye to a short athletic career or a chosen profession after decades, we need to find activities that are satisfying, enjoyable and ultimately filled with meaning. We need to surround ourselves with caring friends and family whose company we enjoy and who have our welfare in mind.
What will we do with our time, though, now that an office (in a high rise or on a baseball diamond) does not await us each morning? We may not have Derek Jeter’s resources (or his looks or talents), but we will face similar questions and decisions. We’ll be watching Derek as he moves into his second act. It will be interesting.
But never as interesting as our own.
by Steve J. Rubin