AAt the beginning of this year, Alexandre Sarr was playing in the Australian NBL, where the average salary was about $100,000. Reed Sheppard played in college and earned nothing but zero trades. Now, both are millionaires after taking the second and third picks in June’s draft. Sarr’s rookie deal with the Washington Wizards is guaranteed $23 million, while Shepard will have to earn $20 million from his contract with the Houston Rockets (these two contracts could end up paying $45 million for both men above) . It’s not just the top picks who suddenly gain wealth, either. Nine players in the second round of this year’s draft — who may not have meaningful careers in the NBA — have signed multimillion-dollar deals with their teams.
These contracts often make life better. But they can also become a burden when young people, often in their teens, suddenly struggle to cope with the wealth they have acquired overnight.
“There’s a lot of money coming in,” Hall of Fame point guard Tim Hardaway told the Guardian. “A lot of money is coming in.”
Hardaway was the creator of the “killer crossover” dribble and one of the greatest NBA stars of the 1990s. With this status came wealth. According to Basketball Reference, Hardaway earned more than $45 million in salary during his career, not to mention his endorsement deals with Nike and other companies. But with money comes responsibility.
“It’s tough,” he said. Hardaway, who was born in Chicago, explained that he began taking care of his mother once he started getting paid in the league. She stopped working, knowing he could support her. He said that while he’d love to do it, it’s a common story for professional athletes. When a person succeeds, he becomes the breadwinner of his family.
However, unlike many professional players, Hardaway is not a spendthrift. He knows how to handle his bills and doesn’t spend money on unnecessary things. But he bought it for himself early on. “My Jeep Cherokee,” he said with a smile. “Phnom Penh Limited. It was red and had gray seats inside. I thought I was a loser!
If people ask for money, Hardaway can also say “no” to them when necessary. “Because of my mother,” he said. “Speaking of which, I don’t owe you anything! I won’t give you anything! I know how to say no. Man, I’m told that’s not enough [growing up] I know how to tell people no.
Hardaway also received advice from his first NBA coach, Hall of Famer Don Nelson of the five-time champion Boston Celtics. “He said, ‘It all goes by so fast. The next thing you know, you’re retired. So, no matter how much money you make, make sure you take care of it,'” Hardaway said. “Those two things have stuck with me throughout my career.”
In the 2000-01 season alone, Hardaway earned $12 million while playing for the Miami Heat (worth approximately $20 million in 2024). This contract made him the highest-paid point guard in the NBA that year, including team wins and individual success). While it wasn’t all about the money — Hardaway said he would enter the NBA for free if necessary — his talent was put to good use. Recently, he spoke with his son, Tim Hardaway Jr. “I think he’s done a great job,” Hardaway said of his son’s financial situation. “His agents are doing a great job paying him. He’s investing and doing what he needs to do to make his money grow. He and his people are doing a great job.
Today, contracts are exploding even compared to Hardaway’s era in the 1990s. This summer, Boston Celtics star Jayson Tatum signed a contract worth $313 million. But such numbers can be scary. Back in the 1990s, when Charlotte Hornets star Larry Johnson signed an $84 million contract, teammate Muggsy Bogues was worried it would be a burden on the power forward, who had just signed him a few years earlier. He wrote in his memoir: “I am happy for him, but I also know that such a big contract brings great expectations from fans and management.” In 2015, Johnson filed for bankruptcy.
Another former Celtics All-Star, Antoine Walker, made nearly $110 million during his career, but he also lost it all. Former Boston Celtics champion and “Big Baby” Glen Davis was recently sentenced to 40 months in prison for trying to defraud the NBA after losing all of his millions. Davis said the league doesn’t help players succeed after their careers are over (Warriors star Draymond Green agreed). Former Milwaukee Bucks star Larry Sanders, who signed a $44 million contract in 2013, told The Guardian earlier this year that earning money at such a young age How difficult it is to have so much money.
“I went from having nothing,” he said, “and then you have everything. The people who are supposed to mentor you become your dependants. And you’re too young to do that.” Sanders said at the time There’s a lack of support systems in the league and in personal life “You can feed the sharks in a lot of ways. You find yourself in a very vulnerable position…it feels like a trap, it feels like a trap. I feel very lonely.
There are so many stories about athletes losing everything that ESPN produced a documentary on the subject in 2012 called Broke. The film follows NFL, MLB and NBA players who lost tens of millions of dollars soon after their careers ended due to a combination of failed business ventures, child support payments and mistaken purchases of items such as flashy mansions, cars and jewelry. Today, however, the NBA is better able to educate its employees on the dangers of becoming a millionaire in your early 20s.
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Not only that, but there are former players looking to help the new generation, such as former Seattle SuperSonics All-Star Detlef Schrempf, who made more than $30 million a year in the NBA and now works for Coldstream Wealth Management jobs.
He lists several things athletes should remember when they get rich, from hiring a registered investment advisor to keeping finances and representation separate, to not granting power of attorney to anyone, to having a coordinated financial plan.
“Education is key,” he said. “The right professional relationships will help you clarify your goals.” This advice comes not just from his work, but from his life as a player. “I never imagined growing up that I could make so much money, even in college,” Schrempf said. “I didn’t have much money growing up, and although we lived well with a big contract, we lived within our means and never exceeded our budget.”
Bob Whitsitt, the former NBA general manager who brought Schrempf to Seattle from the Indiana Pacers, signed dozens of players for hundreds of millions of dollars during his years as an executive. players. Whitsett witnessed it all. “A lot of people want to have tangible thing,” he said. “There are always people buying mom a house or telling mom to stop working…but then you have friends or entourage on the payroll, and that can be one of the ways you start losing money.”
Whitsett cited successful players such as Hall of Famer Dave Bing, who invested in the steel industry, and Junior Bridgeman, who despite making a single season Never exceeded $350,000, but now has a net worth of $600 million thanks to shrewd investments in media and fast food. But with every success story comes great loss. Whitsitt recalled one player paying his wife to fly from Seattle to Atlanta just to get her hair done. He recalled another man asking for a large signing bonus so he could buy six $125,000 watches for his friends. “It’s like someone won the lottery,” he said. “Statistically, a lot of people who win the lottery are broke. They’re not ready for such huge sums of money. There’s responsibility, there’s stress, there’s pressure, and everyone lends a hand.
But if a player is smart and thinks long-term, he can have a bright financial future. For example, reigning Rookie of the Year Victor Wembanyama isn’t overly concerned with jewelry or cars. When he signed his NBA contract, one of the first things he planned to buy was a Millennium Falcon Lego set. Memphis Grizzlies 2022-23 Defensive Player of the Year center Jaren Jackson Jr. invested heavily early. Miami Heat star Tyler Herro, the 2021-22 Sixth Man of the Year, wisely told GQ that he knows his deal has to last him a lifetime. Portland’s rookie point guard Scott Henderson took a class on finances. “I was locked in,” he told GQ. “Take notes.” Then again, there’s still room for fun: In his first contract, Herro bought his mom a $5,000 Gucci purse (and two cars of his own).
“You can make money playing basketball,” Hardaway said when recalling the life of an NBA player. “You have to have the money. But if you don’t go out and do your job, you won’t get it [paid]. sometimes i’m good at [saving]sometimes, I’m not. [Investing] It will help you in the long run. [Taking financial classes will teach you] Everything you should know about being an adult. Some people listen, some don’t.
