CJ McCollum estimates 1/3 of players live paycheck to paycheck

[HollowEarth]

You'd be wrong. 70+ % Of americans live paycheck to paycheck, sure at first most people wouldn't even know how to spend NBA level game checks, but they will eventually get acclimated to that new salary and find new more expensive way to spend their new found wealth.

The problem is we don't teach kids about money, so even guys who make it to a literal 1-a-million situation like being a pro athlete a lot of times will still end up spending their whole check week after week. Look at Mike Tyson how many millions upon millions did he make over his career? He wound up broke too.

Hell, you chance of filling for bankruptcy is HIGHER if you win the lottery, the problem is societal wide its not limited to NBA players being especially bad with their money more so then any-other group of people. Hand-to-mouth, its the american way.

Being a former financial advisor, there are varying degrees of accuracy in these statements. Depending on the survey, Americans living paycheck to paycheck ranging from half of the workers making under $50,000 (according to Nielsen data) to 74 percent of all employees (per recent reports from both the American Payroll Association and the National Endowment for Financial Education).

A lot of it is not because of extraneous lifestyle spending. The average salary in the United States is $56,000, which is not a lot of money by 2020 standards. First, the cost of living and location are major factors -- $56,000 is good money in rural South Carolina, but it's poverty wages in New York City. The median home price in the United States is $200,000, but it's all over the place depending on where you live -- $200,000 could get you a four-bedroom, three-bathroom house with half an acre of land in Iowa but you're living in a crack house in Los Angeles.

In terms of NBA players, I can see the lower-paid players struggling financially. Someone like Golden State's Eric Paschall (salary: $898,310) is not making a lot of money living in the San Francisco/Oakland area. According to Zillow, the median asking price for a home in San Francisco is $1.3 million. That's not the price for a luxury mansion or an expansive estate — that's the price for the average home, including single-family houses and condos.

Conversely, someone like Charlotte's Devonte Graham (salary: $1.4 million) can live much more comfortably in an area where the average house is $275,000. Graham's salary is on par with what many executives make in the Charlotte area (think Bank of America, Wells Fargo and Duke Energy). Paschall's salary doesn't stretch nearly as far, especially when you start factoring in taxes and other living costs in one of the more expensive areas of the United States.

I agree that financial literacy should be more of an educational focus in the United States, particularly in retirement planning. I certainly cannot find pity for people such as Mike Tyson, who filed for bankruptcy after making $400 million in earnings because of spending lavishly. But we can't assume the 10th man on a team is burning through money or the soccer mom marketing coordinator making $50,000 is living large because she bought an SUV to take her kids to their games.

That seemed crazy to me (from South Louisiana) so I searched 150-200k homes on zillow. There were a few legit places to live it looked like, but I wanted to share the two funniest ones in terms of wtf-200k? from someone outside of the city.

1. https://www.zillow.com/homedetails/2415-N-Alvarado-St-Los-Angeles-CA-90039/95583023_zpid/
So that's a fixer upper. I thought which one of those houses are for sale in the first photo, and then I scrolled down. Oh, it's none of them. That's the decrepit foundation of a demolished home embedded into a hill surrounded by fun graffiti.

2. https://www.zillow.com/homedetails/16079-Yarnell-St-SPACE-D13-Sylmar-CA-91342/136688006_zpid/
Is that two trailers? It doesn't look like a normal double wide; it looks like they fused two trailers together. The thing that made the price so crazy to me was that you get no land in this sale. It's literally just the home.

Still, all this feels more applicable to hourly workers than NBA players.

[wco81]

Yeah Paschall doesn't need to buy a home.

He can rent a really nice place for $5k a month, even in San Francisco. $10k for something that's more baller.

It won't be anything like the mansions Curry owns but when he gets out of his rookie contract, he should be able to sign for millions a year.

[Saint Lazarus]

The taxes really are criminal, we should probably stop letting the government take half our income.

For sake of both of us, I hope you're just joking.

[abark]

What is the median salary?

The average is skewed by some super max salaries.

What percentage of the players are on minimum salaries?

Minimum is still over a million?

The minimum salary is around $898,000 for a player with zero years experience. But there are exceptions because of things like 2-way contracts where you have players making less.

For example Ky Bowman's base salary was $79,568 last year. But 2-way players like him do get paid the actual minimum for every day spent with the team. So he was expected to make around $111,000 dollars when he maxed out on the 45 days the NBA allows. He did sign an actual NBA contract when the team decided to keep him on the roster full time.

During his time playing for the Warriors he would stay in a team provided hotel and never even removed his belongings from his suitcase. The SF area was simply too expensive for him to pay for an apartment when his salary was so dependent on him actually making the roster. Remember, this is a guy that came from nothing that had a base salary that would qualify him for below market rate housing in the area.


I think the NBA took a backwards approach when they instituted max contracts to spread out money amongst players. This merely shifted the extra money that would have gone to stars to mid tier players getting overpaid. The minimum salary should have been what they focused on. No one playing in a league making this much money should be making less than a million dollars. And I would go a good deal further.

[Najee12]

Are we now saying $900k gross annual income isn't still a huge amount for a single person?

No, I said relative to NBA players, someone such as Eric Paschall playing in the San Francisco/Oakland area (where the typical house is considerably more than his salary) will not have his money go as far as players in other cities on the same pay scale. Then you factor in considerations such as California's taxes and overall living expenses, someone like Paschall's money will not go as far as someone such as Devonte Graham who plays in a city with a considerably lower cost of living.

This conversation likely will go better if people stop mixing in these comparisons to the average U.S. wage-earner whenever it suits their convenience. It's fallacious to compare a professional athlete (an incredibly unique and skilled worker who works in an incredibly thin market with an incredibly short career span) with the average wage-earner (who makes less money because there are thousands of more people in the United States who could perform the same job, but as a tradeoff has potentially a much longer career).

Some people are trying to equate their salaries and labor market situation to an NBA players' salary labor market situation and it's not an equal parallel. Not every NBA player is making Stephen Curry or LeBron James money; they just happen to be on the extremely high end of the pay scale even compared to other athletes.

Players such as Paschall and Graham are much closer to the average NBA salary -- namely, guys on low-scale contracts hanging on to play in the NBA. They are the ones more likely to go bankrupt when their playing days are over; they didn't make nearly as much money and many times they don't have many lucrative post-career options.

Players such as Antoine Walker are more spectacular examples, but then again he was far higher on the NBA pay scale than the typical player (which makes his bankruptcy much more spectacular). The players in question for this topic are more like David Harrison, who played four seasons in the NBA, had a low-scale contract, out of the league at 25, bounced around to some lesser leagues and was working at a McDonald's.

[RememberLu]

The taxes really are criminal, we should probably stop letting the government take half our income.

For sake of both of us, I hope you're just joking.

Hell no; you think it's fair that someone who gets paid $8 million only actually receives $4?

> athletes are fiscally irresponsible
> Here you go federal government spend half my income, I'm sure you'll spend it responsibly

[DowJones]

Eric Paschall is also going to make $1.5 million and $1.8 million the next 2 years. He is fine as long as he does what every American should do--live within your means. Rent a home in Oakland and commute to work. Walk into Charles Schwab and have them help you set a financial plan up. Even in this worst-case scenario (NBA rookie making low dollars in San Francisco) I don't see any legitimate excuse.

This isn't a NBA issue. This is a human issue, as has been noted. Just live within your means and be responsible with your money.

[DowJones]

I will say that people see the reported numbers and assume that is what players take in. Whatever the reported number of a deal is, cut it in half. That is a more accurate representation of what a player will actually take in.

[DowJones]

So let's assume Paschall's take home pay is $425,000 for this year. That seems reasonable. That means his monthly income would be over $35,000. You can get a really nice 2 bedroom apartment in Oakland for $5,000 a month. That represents just 14% of how monthly income. That gives him over $30,000 for the rest of the months expenses. The percentages just get smaller and smaller for him over the next 2 years. Eric Paschall will have a VERY nice life in the Bay area over the next 3 years living within his means.

[INKtastic]

I mean, probably the same amount of people on here do too.

How many of you have 3-4 month of expenses in your bank?

This. People don't need loads of bathrooms, central air, giant kitchens, pools, new cars, dope lawnmowers, electric chainsaws, those projector that put ghosts on your house for halloween, grass, really grass is useless, cable, flat screens. A lot of the U.S. is living paycheck to paycheck. The attitude just looks a lot stranger when you watch somebody burn through a six figure paycheck.

Big example: Mitsubishi Mirage. It's a little car designed for Southeast Asia. Mitsubishi has been trying to sell them over here. It's got room for four passengers, a big hatch, fold down seats, safety features, backup cameras, a touchscreen, great fuel economy, a cvt, good reliability, and it's cheap to maintain. Nobody buys them. If your neighbor gets a heavy duty truck, lifts it, and decks it out with chrome and bedliner, a lot of folks feel like, "How the hell am I gonna park a little Vietnamese-market hatchback next to that?" NBA guys are making that decision on bigger scale. When they're parking between a Ferrari and an Aston Martin, they're thinking, "How the hell am I gonna park this dumb work truck between a bunch of supercars?"

Off topic, but no gas cars get great fuel economy. It's all abysmal compared to EVs. EVs can travel about 25 miles just on the amount of energy it takes to refine a gallon of gasoline (6 KW). If you add in the energy used for drilling and transportation of that gallon of oil, it's 33 miles. 33 miles in an EV just form the energy it takes to get a gallon of gasoline into a car.

[SCTwins]

I'm not defending the spending habits of these players at all. This post is about human nature.

Before social security, half of the elderly population lived in poverty. And most of those people worked their full adult lives (while admittedly making far far far less).

Point is, people as a whole seem to very often spend based on what they are currently making, and are very poor at preparing themselves for life after an income.

This is why I have always believed that a safety net system needs to be in place for athletes. The average age of of retirement for solid NBA players is still early 30's, and the average career span is less than 10 years.

Add the fact that most of the income made for these players occurs during their formative years. The human brain does not fully stop developing until age 25, and often times even later.

Again, not defending idiotic spending habits. I'm only acknowledging a disturbing phenomenon that is undeniably true about people in general.

Instead of shaming, I prefer to advocate for changing the system to help protect players from themselves (just like we did with social security).

The NBA has had a pension plan since 1965 and it's one of the best in pro sports.

The best thing the NBA/agents could do for some of these players is defer part of their salaries to their post-playing careers until they can collect their retirement money.

Good luck convincing a 19 year old to do that though.

[JN61]

NBA players aren't very smart and considering amount of one and done players I wouldn't be surprised if very close to the reality. Should we feel sorry for them? No.

[AKBlazerFan]

I find myself wondering what 19 year old me would've done with an average NBA salary. I grew up middle class, have always been fiscally responsible, but I can't guarantee 19 year old me would've put it in savings or invested it wisely. I probably would've bought a lot of dumb **** and given a lot away to friends/family.

Again, I don't have a lot of pity for NBA players who are going broke, but I also think its easy to forget many of these guys are still much younger/dumber than many of us are now, but maybe not much different from us when we were their age.

I imagine its also easier to say "Oh, I would invest it in this, and not spend it on that, and not give it away to people.." but until you are in that situation (and the large majority of us will never be in it), it is all just talk.

When you have money/fame, you also have a financial target on you and your life will change, whether or not you want it to. People will begin asking you to help with this bill, trying to scam you, or trying to convince you to invest in this idea. You have women trying to pregnant for that monthly check. Lawsuits will come at you for the silliest ****, as everyone is trying to get a piece of the pie. This is a lot of stuff to avoid for a 19-20 year old.

To sum it up, I don't have pity for them, but I also can understand how it happens and it may not be as simple to avoid as some of us on here like to think.

[Chris Porter's Hair]

So let's assume Paschall's take home pay is $425,000 for this year. That seems reasonable. That means his monthly income would be over $35,000. You can get a really nice 2 bedroom apartment in Oakland for $5,000 a month. That represents just 14% of how monthly income. That gives him over $30,000 for the rest of the months expenses. The percentages just get smaller and smaller for him over the next 2 years. Eric Paschall will have a VERY nice life in the Bay area over the next 3 years living within his means.

The point you're making should still hold true, but your math is not taking taxes into account, so is way off. If he makes $425,000 a year, after tax he probably sees more like $225,000. That is more like $18-19k a month. At that rate you should still be able to live well in the Bay Area, including $5k on rent. He'll be comfortable, and should be able to save some money for the years ahead. But he likely isn't buying a house, a stable of cars, etc.

[AKBlazerFan]

So let's assume Paschall's take home pay is $425,000 for this year. That seems reasonable. That means his monthly income would be over $35,000. You can get a really nice 2 bedroom apartment in Oakland for $5,000 a month. That represents just 14% of how monthly income. That gives him over $30,000 for the rest of the months expenses. The percentages just get smaller and smaller for him over the next 2 years. Eric Paschall will have a VERY nice life in the Bay area over the next 3 years living within his means.

The point you're making should still hold true, but your math is not taking taxes into account, so is way off. If he makes $425,000 a year, after tax he probably sees more like $225,000. That is more like $18-19k a month. At that rate you should still be able to live well in the Bay Area, including $5k on rent. He'll be comfortable, and should be able to save some money for the years ahead. But he likely isn't buying a house, a stable of cars, etc.

I believe when he says "take home" pay he is referring to after taxes. So the original salary is closer to 900k/year.

[ORLMagicGirl15]

Understandable! If they were raised with no financial literacy, having money will be overwhelming. They might not know about budgeting (or hiring a correct financial advisor), paying bills, savings, investing, having an emergency fund, paying off debt (or not getting into it) and such. How many people get a paycheck, pay their bills and wonder where all their money went? Managing money is a tough thing, even harder when you don’t understand that it is possible to manage.

Not to mention the psychology they have to endure from others who believe it is their right to the athletes money. I don’t know why people all of a sudden put a cost to a friendship once their friend become wealthy

[abark]

The taxes really are criminal, we should probably stop letting the government take half our income.

For sake of both of us, I hope you're just joking.

Hell no; you think it's fair that someone who gets paid $8 million only actually receives $4?

> athletes are fiscally irresponsible
> Here you go federal government spend half my income, I'm sure you'll spend it responsibly

The problem isn't the taxes, it's how they are spent. Especially in the US, where that money is spent on war and not on the people. That is the result of having politicians that are bought and paid for by corporations.

But you need that money to build a functioning society with proper education, healthcare, infrastructure, a social safety net and more.

And taking it further, if you are literally arguing for zero taxes, how do you pay for police, judges, and lawmakers (aka politicians). Enjoy your lawless society where the size of your personal army is proportional to your rights.

Look at "high tax" societies in Scandinavia. They perform the highest in basically every metric of societal health. They even have the highest "happiness index," so they seem to enjoy the societies those taxes have built.

I'm sure they'd also love the idea of keeping all their money. But you can't have your cake and eat it too. You can either have a functioning society, or rugged individualistic capitalism where the rich prosper and everyone else struggles to survive.

[D.Brasco]

The taxes really are criminal, we should probably stop letting the government take half our income.

For sake of both of us, I hope you're just joking.

Hell no; you think it's fair that someone who gets paid $8 million only actually receives $4?

> athletes are fiscally irresponsible
> Here you go federal government spend half my income, I'm sure you'll spend it responsibly

The US has some of the lowest personal tax rates in the developed world but a lower quality of living for its poor.

Either way tax rates should be increased for larger corporations like Amazon who pay little to no federal taxes.

[RememberLu]

For sake of both of us, I hope you're just joking.

Hell no; you think it's fair that someone who gets paid $8 million only actually receives $4?

> athletes are fiscally irresponsible
> Here you go federal government spend half my income, I'm sure you'll spend it responsibly

The problem isn't the taxes, it's how they are spent. Especially in the US, where that money is spent on war and not on the people. That is the result of having politicians that are bought and paid for by corporations.

But you need that money to build a functioning society with proper education, healthcare, infrastructure, a social safety net and more.

Look at "high tax" societies in Scandinavia. They perform the highest in basically every metric of societal health. They even have the highest "happiness index," so they seem to enjoy the societies those taxes have built.

I'm sure they'd also love the idea of keeping all their money. But you can't have your cake and eat it too. You can either have a functioning society, or rugged individualist capitalism where the rich prosper and everyone else struggles to survive.

The reason Scandinavia doesn't have to spend much on defense is because we spend money on defending them. Their entire social democrat utopia sits under the umbrella of protection that U.S. military spending provides. It also exists on top of a prosperous capitalist economy. These countries were economically prosperous even before adopting social welfare policies. Bureaucratic corruption isn't unique to capitalist systems anyway, as anyone who's lived in a socialist state can tell you.

But none of this has much to do with the fact that it's ludicrous for the government to be taking half of what someone has earned.

For sake of both of us, I hope you're just joking.

Hell no; you think it's fair that someone who gets paid $8 million only actually receives $4?

> athletes are fiscally irresponsible
> Here you go federal government spend half my income, I'm sure you'll spend it responsibly

The US has some of the lowest personal tax rates in the developed world but a lower quality of living for its poor.

Either way tax rates should be increased for larger corporations like Amazon who pay little to no federal taxes.

1, the U.S. has one of the most progressive tax systems in the world, meaning the very rich shoulder 80%+ of the total tax burden.
2. How much do you know about the way corporations are taxed? I can tell you for a fact that the oft-repeated myth that Amazon pays 0 in taxes is misleading. It's actually good that companies pay less tax, they can reinvest that money to grow the business, purchase more assets, pay more workers, etc. There's another tax associated with all those acts. Every Scandinavian country btw has a low corporate tax rate

[Air Apparent]

does the nbapa do anything for rookies? like some mandatory financial education or resources?