Young adults should observe the financial disaster currently plaguing former professional basketball player Allen Iverson and learn from his mistakes. We’re talking serious mistakes. The kind of mistakes that lay waste to more than $200 million Iverson earned over the course of a 13+ year pro career. While there is no evidence that the player nicknamed “The Answer” has filed for bankruptcy protection, we do know that he has an outstanding bill at a Georgia jewelry store for $859,000! Maybe he just doesn’t want to pay it, or maybe he can’t.
Regardless, Iverson made the mistake of not answering the lawsuit
and ended up having his wages garnished and Wells Fargo bank account taken over by the judge. No word on whether or not there was anything in the account to claim. Some would say this day of Iverson’s financial demise was foreshadowed back in high school when he was involved in a bowling alley brawl, then down through the many incidents of violence that followed his career.
Is it a coincidence that Iverson’s playing style was one of reckless abandon? Sort of like his spending style, which included supporting a “posse” of at least 50 friends and family who followed him everywhere and relied upon his salary to finance their lifestyles. As a poor child from the ghetto, Iverson was determined to stick with the friends he credited for getting him out of the so-called “life” of a gangbanger.
Consider this. If Iverson had put even half of his salary into a passive investment like a broad index-based mutual fund, he’d be looking at entirely different ending to the story. And that’s assuming he decided to blow $100 million. Sadly, this player’s plight is not a solitary one. The National Basketball Association (NBA) itself preaches to incoming rookies that 60% of all players are broke within five years of leaving the game. If that is truly the case, there is some seriously bad financial decision-making going on out there!
So don’t get too depressed over an investment gone bad or financial move that didn’t pan out. It could always be worse. You could be Allen Iverson.
The Young Wealth Team
Flickr / Keith Allison