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Going for broke: Many pro athletes still struggling with finances

Ryan Dorfman, Cronkite News on

Published in Home and Consumer News

PHOENIX -- Mike Tyson. Allen Iverson. Diego Maradona. Terrell Owens. Four major athletes, four major sports.

And an estimated $600 million of earnings lost.

Eight years after an eye-opening Sports Illustrated study suggested 60 percent of NBA players go broke within five years of retiring from the game, concerns remain about professional athletes' finances as another NBA season gets underway. A new study by the National Bureau of Economic Research reports that nearly 16 percent of NFL players drafted between 1996 and 2003 declared bankruptcy within 12 years of retirement.

"My Mom is an educated woman, went to law school," Phoenix Suns forward Jared Dudley said. "So, I was lucky. A lot of players didn't have that."

Athletes in financial distress can be found in all leagues and all cities.

Former Diamondbacks pitcher Livian Hernandez filed for bankruptcy in July after making $53 million in 17 seasons. Pro golfer Billy Mayfair lost many of the millions he made following a difficult divorce and custody battle. Short-time Diamondbacks manager Wally Backman, after an accomplished playing career, was sentenced in 2012 on charges of bankruptcy fraud, concealment of assets and money laundering. Boxing's Tyson, basketball's Iverson, soccer's Maradona and football's Owens all lost fortunes.

How does it happen? Those close to the situation suggest a variety of reasons, from lack of financial education to unscrupulous advisers to not taking advantage of resources.

"I would say, on the two (NFL) teams I was on in those three years, probably 30 meetings or so, there was maybe four to five guys on the entire team that would show up," former Arizona State and NFL quarterback Rudy Carpenter said about financial meetings the league offered.

Carpenter also pointed to the NFL's 401(k) program that allows large contributions that the league will match.

Many players don't take advantage of this, Carpenter said, because of a lack of trust and education. Many aren't educated early enough about the financial world, and it causes distrust with the "system."

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