The salaries paid to professional athletes are sometimes impossible for the average fan to comprehend. A $100 million here, a $100 million there and pretty soon it adds up to real money, to borrow loosely from an esteemed politician of the past.
Despite the crazy salaries, the sad (or satisfying, depending on your viewpoint) fact is that many professional athletes burn through their hordes of cash, often before hitting retirement.
Sports Illustrated looked into the reasons athletes go broke and published its report in 2009. One of the most common mistakes they make is sinking money into startups. It’s a bad bet to invest in a restaurant franchise trying to take on an established chain (Raghib Ismail). Then there’s profligate spending (Mike Tyson and others), divorce (see Mike Tyson) and drugs (Maradona).
With the pitfalls in mind, AdvisorOne presents its list of the Top 10 Worst Financial Meltdowns by Athletes.
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10. JOHNNY UNITAS, football: About $4 Million Lost
Like many athletes, Johnny Unitas, who many consider the greatest quarterback in NFL history, was not as adept at making business decision as he was at driving his Baltimore Colts to last-minute victories, including in the 1958 championship game. In 1991, two decades after retiring, he filed for bankruptcy. No details of his assets or debts were listed, but the culprit was $4 million in loans he made to a circuit-board company. His big mistake? Personally guaranteeing the loans.
9. DARREN McCARTY, hockey: More Than $6 Million Lost
Darren McCarty starred for the Detroit Red Wings and Calgary Flames for 13 seasons, made as much as $2 million some seasons. Bad decisions, gambling, divorce and a battle with the bottle landed him in bankruptcy court where he listed $1.9 million in assets against $6.2 million in debts. Working his way back to solvency was an ordeal, but at least he has a new job. This month, he joined the crew of “Hardcore Pawn,” truTV’s most popular series. Seems like he would have a lot of empathy for the customers he’ll encounter.
8. JOHN ELWAY, football: $15 Million Lost
Hall of Fame quarterback John Elway has often made bold decisions. Drafted by the Baltimore Colts, whom he deemed unworthy of his talents, he threatened to stick with his fledgling baseball career in the minor leagues for the New York Yankees unless he was traded.He got his wish and enjoyed a stellar career with the Denver Broncos.
There’s one decision we are sure he wishes he could do over: $15 million sunk into what prosecutors say was a $71 million Ponzi scheme called Mueller Capital Investment. There’s no hint that Elway is broke (he raked in more than $80 million from the sale of five auto dealerships) and he is an executive with the Broncos. And he can take solace in the fact that more than five dozen others fell prey to the Ponzi scheme, including former Janus fund manager Blaine Rollins.
7. RAGHIB ISMAIL, football: Nearly $18 Million Lost
He was called the “Rocket” on the field for his blazing speed and electrifying moves as a wide receiver and kick returner, but in the investment world Raghib Ismail turned out to be a dud.
In a 10-year career in the Canadian Football League and the NFL, Ismail took home at least $18 million. But most of it was lost through bad investments, including $300,000 in a Hard Rock Café knock-off and a big chunk of change in a cosmetics procedure that was touted to make the skin better absorb oxygen. All may not be lost, though. Ismail did find an investment that is apparently working out: Bite Tech mouth guards, a brand now preferred by many athletes.
6. MARADONA, soccer: $26 million Lost