How Would You Go Broke?

20 Questions | By Gmiller7138 | Updated: Mar 21, 2022 | Attempts: 116

70% of all professional athletes will go broke within five years of retiring from their sport. There are many reasons why this occurs, but they can be grouped into five categories. This quiz asks a series of questions which can help determine what may be a hurdle to your financial success. These questions may be targeted to professional athletes, but are applicable to everyone. As anyone can find themselves on the receiving end of a nice sum of money, it is important to identify the risks that you may face.

You May Get

Bad Investments

Athletes, by nature, are competitive and this does not turn off when they are done playing the game. When it comes to investments, athletes want to win big. However, in order to win big, you have to risk big. Many athletes try to invest in private endeavors, but only 1 in 30 will ever make any money. No jail time, drug charges or bankruptcy here, just bad business moves. Financial vultures bled Ismael’s riches by selling him their “fool-proof” investments. After bypassing the NFL as the presumptive #1 pick, Ismael went to the Canadian Football League and signed the largest deal in their history. He played two years in Canada and 10 in the NFL, earning an estimated $18 million to $20 million in salary alone. He then started to invest in a series of ventures that went bust, including a Rock n’ Roll Café, COZ Records, a movie, cosmetics, nationwide phone-card dispensers, and calligraphy proverbs kiosks. Be the next Warren Buffett If it is too good to be true, it probably is. Don't think that the best way to get rich quick is to invest. Investing is slow and methodical and requires discipline and patience. Quick rich schemes are like diet fads; they come and go leaving those who attempt them struggling to make ends meet. Diversify Understand that putting all of your money in one investment is never a smart move. While hindsight may show otherwise, it is usually better to hedge your bets and spread your risk around several vehicles. Invest for the long term Investing is not a sprint, it is a marathon. It may be more fun and exciting to trade everyday, but research has shown that long term investing is the best bet.

Trust Mismanagement

The road to hell is paved with good intentions. Even if you set yourself up with success by handing your money to trusted individuals, it can come back to bite you. Many athletes have fallen victim to accountants and money managers who are incompetent or far more insidious. Sheryl Swoopes, the “Michael Jordan of the WNBA,” scored her own Nike deal for the Jordan-inspired “Air Swoopes” brand. Swoopes, a marketing machine, enjoyed a stint as the face of the WNBA, but her fortunes didn’t last. She filed for bankruptcy in 2004, citing mismanagement by her agents and layers. She owed nearly $750,000. Don't be a Swoopes! Educate yourself Even if you do not know everything, at least know something. Understanding how your personal finances work will go along way in protecting yourself from scheming individuals. Due Diligence Research any potential agents, lawyers, financial planners, investment partners before you sign any contracts or make any deals. It is important to know as much as you can about the people you are trusting your money with. Separate Commitments Do not have one person who is your agent, manager, financial advisor, and accountant. Hire several one person for each. This creates a natural check and balance system that helps prevent one individual from taking advantage of you.

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Questions and Answers

1.

Which professional sport do you or would you play?
- A.
  
  Baseball
- B.
  
  Football
- C.
  
  Basketball
2.

After receiving your signing bonus, how much do you think Uncle Sam will take?
- A.
  
  10%
- B.
  
  20%
- C.
  
  40%
- D.
  
  60%
3.

What are you going to do with your first pay check?
- A.
  
  Strip Club
- B.
  
  Buy Mom a new house
- C.
  
  Throw a party
- D.
  
  Buy a new car
4.

Who do you hire as your agent?
- A.
  
  Trusted relative
- B.
  
  Trusted friend
- C.
  
  Someone who was recommended to you
- D.
  
  Do it yourself
5.

Who do you hire as your manager?
- A.
  
  Your agent
- B.
  
  A relative
- C.
  
  A trusted friend
- D.
  
  Someone who was recommended to you
- E.
  
  Do it yourself
6.

Who do you hire as your accountant?
- A.
  
  Your agent or manager
- B.
  
  A relative
- C.
  
  A trusted friend
- D.
  
  Someone who was recommended to you
- E.
  
  Do it yourself
7.

How big do you want your house to be?
- A.
  
  Small, yet comfortable.
- B.
  
  Average size.
- C.
  
  Deluxe apartment high rise in the sky.
- D.
  
  B.I.G.
8.

A big signing bonus comes to you. Your first impulse would be to:
- A.
  
  Spend it on things I want, including gifts for others
- B.
  
  Immediately put it somewhere safe.
- C.
  
  Put off making any decisions until I felt less overwhelmed.
- D.
  
  Figure out ways of investing it to get the best possible return.
- E.
  
  Give most of it away to organizations that can make the world a better place.
9.

When it comes to dealing with money:
- A.
  
  I make sure it never influences my life choices.
- B.
  
  I enjoy spending it on gifts and anything else that gives me pleasure.
- C.
  
  I think about it a lot and strategize how to make more of it.
- D.
  
  I hold onto it and enjoy thinking about the security it provides.
- E.
  
  I try not to think about it and hope it will take care of itself.
10.

My financial objective is:
- A.
  
  To save enough money now so I never have to worry about it.
- B.
  
  Nothing.
- C.
  
  To have enough of it to ensure that I can buy whatever I want.
- D.
  
  To have enough to satisfy my basic needs, and then give the rest away.
- E.
  
  To make as much of it as possible, as quickly as possible.
11.

After an athletic victory you drive away in what kind of ride?
- A.
  
  Really nice pick-up truck
- B.
  
  Escalade with 24's
- C.
  
  Custom Ferrari
- D.
  
  Bicycle
- E.
  
  I have a driver
12.

You have a chance to enter the draft at the end of your junior year of college. Do you skip your senior year or graduate?
- A.
  
  Skip my senior year, I'll be drafted high
- B.
  
  Graduate, but potentially go down in the draft
13.

As far as paying taxes is concerned:
- A.
  
  I'm always astonished to find out how much tax I owe.
- B.
  
  I save regularly for taxes, and usually file my return well before it's due.
- C.
  
  I hate the whole thing and try to get it done with as little fuss as possible.
- D.
  
  I always have to scramble to get my return done and find cash to pay my taxes.
- E.
  
  I take pride in paying less on my increased income, if I can.
14.

My dream vacation is:
- A.
  
  Miami, Vegas, or in any party town with a pool
- B.
  
  Paris or New York City
- C.
  
  Disney World
- D.
  
  Hometown
15.

If I could be on a TV show, I would pick:
- A.
  
  Cribs.
- B.
  
  The Apprentice.
- C.
  
  Cops.
16.

My family:
- A.
  
  Is part of the reason I work so hard.
- B.
  
  Is who I credit for my success.
- C.
  
  Are my role models.
- D.
  
  Are dead to me.
17.

How many children do you want to have?
- A.
  
  0
- B.
  
  1
- C.
  
  2
- D.
  
  3
- E.
  
  4
- F.
  
  5+
18.

If you had a concern about being rich, it would be:
- A.
  
  You wouldn't know how to manage all that money.
- B.
  
  You might spend it all without saving.
- C.
  
  Fear? NO FEAR!
- D.
  
  You could lose all of your money and end up with nothing.
- E.
  
  My buddy is making more on investments than I am.
19.

You go out for dinner with a few good friends. When the check comes, you:
- A.
  
  Gladly pick up the tab for the whole table...and sometimes even for the new friends you made at the next table!
- B.
  
  Pull out your calculator to calculate exactly how much everyone owes.
- C.
  
  Quickly throw down your credit card without even picking up the bill.
- D.
  
  Pick up the tab because you love treating your friends, or at least pay for those who have less money than you do.
20.

Which of the following best describes your beliefs about money?
- A.
  
  Managing money is overwhelming.
- B.
  
  Save it for a rainy day.
- C.
  
  Wealth corrupts people.
- D.
  
  Easy come, easy go.