Liam Croke: Don’t copy sports stars when it comes to spending money

I had three sporting heroes when I was growing up, Bjorn Borg, Alex Higgins and Kenny Dalglish.

I had three sporting heroes when I was growing up, Bjorn Borg, Alex Higgins and Kenny Dalglish.

Because of Borg, when I played tennis I did so with a double-handed backhand. When I played snooker, I twitched and twisted, left my index finger off the cue, exactly as Alex did. When I played soccer for Wembley Rovers, I pretended I was Kenny and tried to score goals like he did. When I did (not that often) I would mimic his goal celebration.

One thing we shouldn’t copy from our sporting heroes is how they manage their finances – because often they are absolutely terrible at it. For example, an estimated two thirds of soccer players in the UK end up broke after their playing days are over, despite the millions many of them earn.

Anyway, what can we learn from our sporting heroes? We can begin by looking at the reasons why so many have lost so much.

That can be attributed to a lack of financial knowledge, poorly-chosen financial advisors, financing the lifestyles of friends and family, high-risk investing, gambling, and divorce.

The very top athletes concentrate all of their time and energy on becoming the very best at their chosen sport. They don’t want to spend what little time they have away from training and travelling on financial matters. Some of them, in fairness, came from relatively poor backgrounds like George Best, Mike Tyson and Alex Higgins. Riches came to them early and they hadn’t much formal education or role models to could get advice from.

They had no idea how to handle their wealth and were exploited by others who were only interested in making money from them.

The lesson we can learn here, is not to be overly reliant on others when it comes to your finances. Absolutely, seek and take advice, but also take time out to educate yourself about money, and make sure you are involved in planning for your present and future finances.

Of course, when you become successful and you begin to earn millions, every 31st cousin you ever had comes out of the woodwork and they join your entourage and your payroll.

One NFL player in the States, Antoine Walker, earned $108 million over the course of his 13-year career and admitted before he was arrested for writing dud cheques, that he was supporting 70 family members and friends.

Houses and cars are bought for parents, brothers and sisters and nights out, food, parties are all billed to the sports star and his/her wealth is taken for granted. They think it’s their duty to pay for it. I mean they can’t refuse a family member, can they? Of course they can, and of course we can too.

Gambling is another curse of the sports star. Snooker player Willie Thorne racked up £1 million in debt and his addiction got so bad, he was on the verge of committing suicide. Luckily for him, his wife found him just in time, in a hotel room with a knife in his hand.

I have never come across anyone who solves their financial problems by gambling. I have only come across people who only add to their debts and problems when they start gambling.

Poor investment decisions are another reason sport stars get into trouble. Over-investment in property is a particular issue for them. Just ask one of the greatest rugby players ever, Zinzan Brooke, who became bankrupt when he bought multiple properties in the UK, the value of which were devastated when the downturn happened.

Unable to pay the mortgages, along with borrowing heavily to turn his family home into a Victorian style B&B which subsequently failed, led to Brooke’s demise.

What we can learn from Brooke is not to invest in just one particular area. Don’t become over reliant on property or shares because if you become beholden to one and something happens, you could be wiped out completely. Diversifying and investing in multiple areas reduces your risk.

Another habit we can all be prone to, sports stars especially, is overspending. They see their salaries as infinite, so they spend it like there is no tomorrow. But, of course, there is.

The average career in soccer in the UK for example is eight years and in rugby it is seven years. And if you are lucky enough to last until you are 35, if you don’t plan on having a second career or have set aside enough money to last you until you do, then you are going to be under serious pressure of running out of money.

The moral of the story for us is to not overspend; live below your means but within your needs, never think money will always be there for you. At least have a Plan B.

There are many other reasons sports stars lose everything. The famous Australian golfer Greg Norman’s last divorce cost him $103 million – so make sure you find the right partner!

Boxer Evander Holyfield’s problem was obviously a lack of contraception because he is the father to 11 children. That’s a lot of child support payments.