Formerly Wealthy People Are Revealing The Ways They Lost Millions, And Some Of Them Genuinely Shocked Me
https://www.yahoo.com/lifestyle/former-millionaires-confessi…
CNC
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Formerly Wealthy People Are Revealing The Ways They Lost Millions, And Some Of Them Genuinely Shocked Me
https://www.yahoo.com/lifestyle/former-millionaires-confessi…
CNC
That was fascinating. Thanks for posting
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I enjoyed it also. Reminds of the Laws of Gold in the Richest Man in Babylon:
Fifth Law of Gold–Gold flees the man who would force it to impossible earnings or who follows tricksters or schemers, or who trusts it to his own inexperience and desires in investments
tsimi
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How about former thousandaires? In Nigeria:
**Last fall, on the advice of a friend, Odosa Iyamuosa invested his life savings of $4,000 in a cryptocurrency called Luna. The 28-year-old, who lives in Abuja, Nigeria, researched the coin himself online, and what he found seemed promising. Luna’s price was soaring, thanks to the success of another coin with which it was deeply intertwined, TerraUSD.**
https://www.bloomberg.com/news/articles/2022-05-19/luna-terr…
You know where it’s going, of course.
Also from the article:
**Other investors also say they were prepared for ups and downs, but never imagined such a rapid collapse. Senior Bernier, 24, a flooring contractor in Montreal, says he lost about $250,000. “Do Kwon is a guy I’ve always believed in,” he says.**
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Didn’t read the whole article, most of the stories I had heard before or some derivative. Ironically didn’t see any stories of athletes or entertainers.
Years ago ESPN did a documentary called “Broke”. Was very surprised at how many former NFL players failed off the field. According to them, almost 80% are broke within 2 years of retirement.
http://www.espn.com/30for30/film/_/page/broke
JLC
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I’ve heard this too. Some of the smarter NFL retirees try to give money classes to the kids who walked out of school and into millions. No clue how to handle it.
Similar to lottery winners.
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Not to wander too far afield, but
Was very surprised at how many former NFL players failed off the field. According to them, almost 80% are broke within 2 years of retirement.
Of course to athletes retirement means something different from what it means to most here. Especially in the NFL, it means can’t earn doing what they’re best at any longer, rather than ‘don’t need to’. Although high-profile NFL players are featured, the problem that drags that percentage way up is much more in the average career (only 3-4 years, might be a median instead) and lower salaries of the strong majority of NFL players casual fans probably only know on game day and who don’t win awards or even make it to the lucrative ‘second contract’. To make up a number, the “other 90%” of players. A lot of them are basically career second-stringers until they get injured, so not even necessarily multi-millionaires. That 30-for-30 (which, ftr, I have not watched) has in its summary,
“Sucked into bad investments, stalked by freeloaders, saddled with medical problems, and naturally prone to showing off, many pro athletes get shocked by harsh economic realities after years of living the high life.”
But for the everyday player who was a lower draft pick or even undrafted yet still made the squad, there’s a closer-to-home lesson for regular people. Taxes, an agent, and a general lack of foresight can really trim the life-changing buying power of earning, say, $400-800k (checked, 2022 rookie minimum is a shade over 700k) for just a few short years. The third of those, lack of foresight, is just a proverbial working-person’s version of the “showing off” and “living the high life” referenced for athletes. It’s conspicuous debt-financed consumption, like all the latest tech and unnecessarily expensive clothes, cars, furnishings, and dining. I don’t count travel there because it has too many benefits, but it’s also a source of easy waste and net financial drawdown if it’s done in the same devil-may-care spirit.
I’ll close with my first thought, which was that maybe the likelihood of losing money quickly is related to how long it took to gain it. I won’t call it ‘how hard they had to work for it’ because I know athletes and young entrepreneurs (even employees) work VERY hard for the fast money that can come much more suddenly than for plodders like me. But apart from the risks (as in some of the stories in the reddit compilation) of illnesses or bad luck, the wherewithal to plan for the worst while reasonably enjoying the present seems like common thread.
-n8 (bought a house in a fast-growing area and company stock keeps rising, or I probably would have become a ‘former’ last year as well, at least temporarily)
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I’ve heard this too. Some of the smarter NFL retirees try to give money classes to the kids who walked out of school and into millions. No clue how to handle it.
I believe OJ Simpson was careful to invest his NFL payola well. He still enjoys a fine lifestyle.
CNC
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Money does not give a person prudence or intelligence or good judgement.
Money may allow a person to learn things - if the person wishes to learn.
Howie52
Teaching children what you consider “important” or “valuable” is a parenting skill to be
admired. But parents have to remember that children take in what they see their parents and
grandparents do - and less what their family talks about. Children look up to you - but may
only live up to the lowest levels you demonstrate.
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It seems that when people inherit money, they sometimes blow right through it, buying expensive things – like houses, luxurious cars and even yachts; they have expensive meals at fancy restaurants, or maybe just gamble it away. This seems to be apply to the dumb ones. The other stories here have to do with greedy people taking over funds or money that otherwise would have been inherited by family members or relatives. These people (the family or relatives) may or may not be wasteful spenders – we’ll never know – but they are the victims of others who who manage to get a hold of the money first.
culcha
I believe OJ Simpson was careful to invest his NFL payola well. He still enjoys a fine lifestyle.
Sometimes investing in the right lawyer works out well. 
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" when people inherit money, they sometimes blow right through it, buying expensive things"
My mother, who lived so simply that we never knew she was rich, said that inherited money “was bad for the character” so she left us (her five kids) a little, left us with 10 Foster Children she supported in different parts of the world, and gave ALL the rest of her money to charity…
We each inherited two “Foster Children” …mine were in India and Africa, and it was a good example, as my husband and I have supported Foster Daughters ( I always ask for girls) for 53 years now.
One Foster daughter in China who lived in a mud-floored house with no running water, on a farm in the country, is now an engineering student. She was our Foster daughter from 9 years old till nearly 18.
Our latest Foster Daughter, also living on a farm in a very poor area, tells me she loves Harry Potter!!! (The mind boggles at the juxtaposition!!)
Maryanne
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Those who work save and struggle to earn a million learn many valuable lessons along the way.
Those who inherit wealth or win it suddenly or earn it too easily often have not learned those lessons. Their learning can be expensive. But one hopes they learn before all wealth is gone.
Its a free country. Some may be savy enough to listen to good advice. But others will make poor choices. Such is life.
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Not long ago, DS1 and his wife were moving back to the west coast from Chicago. Their stuff had already been picked up, their departure was five days hence…and their Camry wouldn’t start.
Towed to a reputable garage. In addition to a bad alternator, there was a litany of things: bald tires, brake linings down to the warning level, overdue for all fluids except oil, and some other odds & ends I can’t remember (tie rod ends?). (DS1 never very compulsive about PM).
$4500.
I mentioned to a good friend of mine - mid 50s, childless - who said, “OR Dad could buy them a new car!”
Reflexively, I said, Why would I do that?
— sutton
metal can be poured into a mold, or forged. The stronger one is the one that was bent and hammered on for awhile
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