Fall, glorious fall! The kids are going back to school, we’ll soon escape the hot sweaty summer days (that we’ll miss in two weeks), and football is back. In fact this week wraps up the NFL’s pre-season, and next week we’ll head into the first game of the regular season.
One thing that’s always interesting is all of the faces we DON’T see on the field because players have either been released or have retired.
In the retirement class of 2016 ALONE, there were some huge names- Andre Johnson, Reggie Bush, Tony Romo… just to name a few.
As I was thinking about this, I found a very surprising statistic.
Did you know that, according to a Sport Illustrated Report, 78% of NFL players go broke within 3 years after retirement?
There are three main reasons why they go broke:
1) Bad investment choices
In the world, there are a lot of investment options. Whether they’re too risky, or too conservative, or simply not appropriate for your goals, all of these things could come back to bite you.
2) A long period of time that the assets need to last
NFL Players typically retire in their early 30’s. That’s A LOT of years they need their money to last. As people have begun to live longer lives due to medical science and more access to healthy foods year round, the average retiree’s money needs to last LONGER than any other generation in history.
3) No income plan
Most people retire with no plan to generate income. Without a plan for income, most people can fall victim to spending shocks, market turbulence and reverse dollar cost averaging which can cause them to run out even faster.
The average retiree or pre-retiree can learn from the financial troubles of these athletes.
Sometimes the Choice to Come Out of Retirement Is a Choice
We also see a lot of athletes who come OUT of retirement on purpose, like Marshawn Lynch, the former Seahawks running back who has returned this season to the NFL with the Oakland Raiders.
Marshawn Lynch didn’t come out of retirement because he ran out of money. In fact, despite his unique personality, he isn’t the dummy or thug many make him out to be. There have been stories of Lynch helping rookie Seahawk players set up their 401k plans!
Brett Favre, Michael Jordan and Lance Armstrong didn’t come out of retirement because of money either.
Many athletes come out of retirement because they’re bored.
They didn’t have something in retirement giving purpose and meaning to their lives.
Something they were passionate about, that got them jumping up out of bed every morning because they were excited to go do it.
If you’re approaching retirement, you have to seriously think about what will give purpose and meaning to your life in retirement.
Maybe you simply just love to work and that’s OK! Think about finding a second career, or a part time job.
Most athletes, just like normal retirees, would benefit from having the right retirement coach who could shelter them from these blunders and have conversations with them about life after retirement so they are emotionally and financially prepared.