According to Sports Illustrated, 78 percent of NFL players and 60 percent of NBA players file for bankruptcy within five years of retirement. It’s an all-too-familiar coda to a pro athlete’s career, and director Billy Corben explores the why and how in the documentary Broke.
Screening as a work-in-progress at the Tribeca Film Festival, Broke features candid interviews with athletes who have blown through millions of dollars by investing poorly, supporting bloated networks of friends and family and splurging on absurdities (a pair of home bowling alleys, anyone?). As athletes like Andre Rison and Bernie Kosar retrace the paths of their financial descent, you begin to understand the mechanics and psychology of money management gone horribly awry.
Corben spoke to Outside about his work on the film. The documentary airs on ESPN in October.
How did you initially come up with the idea for this project?
In the spring of 2009, we were working on [Corben’s previous documentary] The U at the University of Miami football program. We interviewed [former NFL quarterback] Bernie Kosar, and when Bernie showed up he had a couple business associates with him. He looks a little stressed—some of the crew noticed he seemed out of sorts. Then less than a week later on the front page of the Miami Herald, there was a story that Bernie had just declared bankruptcy. Bernie was one of these post-NFL success stories. He says in [Broke] that he made a lot more money after he was playing football than he ever did playing. So his bankruptcy came as a real shock to people. But the truth of the matter is once you started to look into it, none of these cases are particularly surprising.
Bernie was leveraged to the hilt in real estate, like a lot of successful people of the early zeroes in south Florida were. And then when the bottom dropped out as it did for the entire world, he felt the same pressure that everybody else did. That’s what was compelling about this process, is that on the front end everybody says how the hell does anyone lose a hundred million dollars? How does Antoine Walker blow through all that money? How does Mike Tyson do that? And when you look at it, it’s not only possible—it’s very easy to do it. And it’s not just simply what conventional wisdom says, which is just reckless spending and irresponsibility of the athletes, although that certainly plays a significant role. It’s not just that, and I think this movie will dispel some of those ideas.
You list a number of different ways athletes go broke, but can you summarize the psychology behind how it happens?
Despite the fact that they’re out there on the field—they’re out there on the court, they can feel it in their knees and every time they get hit or slide into home base or leap for a catch—despite all that, all of these athletes think that it’s never going to end.
I don’t know what that is at work there. Is it the fact that they’re so capable of such superhuman efforts that they feel they are that extraordinary? They all say this, by the way. The retired guys, the current guys, everybody says there is this mentality that it is never going to end. That’s the thing that hits these guys the hardest is their own mortality, the idea that they are going to get older, they are going to get injured. And when does that happen? Most of them before they’re 30 years old. They make the most money they’re ever gonna make in their life in their 20s, and then it’s over. There’s no income unless they have prepared themselves for a life and career after the game.
How many athletes did you request interviews with, and how many said yes?
That’s a stat I’m gonna have to get. It’s safe to say we requested a lot more than are in the movie. We cast a net out far and wide, and I can’t say it enough: I really admire the guys who agreed to participate. I make the joke that we used subversion to get them to agree, but of course we didn’t. We were very candid about what this exactly was about. We were going to be discussing this rather uncouth topic so openly and with such detail, that they’d be sitting there asking what the hell is this movie about? Asking me about my monthly expenses? How many cell phone bills I’ve paid?
We got really detailed with the questioning, and I have a lot of respect for the guys that agreed to talk. They felt that if these stories had been in their face when they were younger, then maybe things would have been a little bit different for them. They really felt like they were doing a film for the younger players coming up about financial responsibility.
It feels like athletes need their own consumer protection agency. Does something like that exist via any of the leagues?
There’s a bunch. As [New York Jets linebacker] Bart Scott said at the movie Q&A [at Tribeca], a lot of these exist but people just need to ask for the help. This is such a pride- and ego-driven profession, and everyone is so competitive, you have to suck it up and say, “Hey, I need help.” A lot of guys are unwilling to do that, but I believe in many cases the resources are there, particularly in the NFL and the NBA. I know that there are resources within the teams, within the leagues, particularly within the players’ associations, the unions.
The film mentions that some of these athletes don’t budget for the off-season. Is that a common problem?
Oh, man. In America we are a paycheck-to-paycheck society, and apparently it turns out that it doesn’t matter if that paycheck is $1,000 every two weeks or $50,000 every two weeks. I hate to quote this, but I remember back when Fran Drescher was doing stand-up, she had a joke where she said every month my credit card raises my limit, and I keep meeting the challenge. I feel like that’s America: You raise our salary, we’ll meet that challenge and spend that money.
Imagine you’re 21 years old and you just signed this contract and, like Sean Salisbury talks about, you get this little briefcase in the mail. You open it up and there’s an Amex Black Card. And a month later you’re getting your credit card bill for a $140,000. Just think of the credit available to you. Think of the opportunity to go into debt if you’re making that kind of money.
You don’t get a sense of what a dollar means if you’re earning that much money.
And these guys, because they’re salaried players, they’re in the highest possible tax bracket when they’re making those kinds of salaries. This is not income from investments—it’s not the kind of income Mitt Romney makes that makes taxes so much lower. These guys pay twice the tax rate that Mitt Romney makes, if not more than that. They’re going out and breaking their bones, and in America we tax that at twice the rate than we do Wall Street. And you saw it in the movie: They don’t even learn about it 'til they get their first paycheck, and they go where the hell is my money?
Did I understand correctly from the film that players also have to pay taxes in all the states where they play during the season?
Yeah, because theoretically—or so says the IRS—they’re earning that revenue in the state that they’re playing in. So you not only need to pay your federal income tax, but you need to pay state income tax in every state you’ve played in. Baseball players play, like, 80 games a year out of their home state. Most of those are series of games, so it’s three games in this city, three games in that city. But you do the math.
It’s hard not to laugh at some of the outlandish purchases. Are any of the athletes worried that people will ridicule them, or do they themselves see the absurdity in it?
Both. More the latter than the former. These guys are already being ridiculed for these things. As I said, the conventional wisdom is they go broke because they spend their money on a bunch of stupid crap. The truth is they spend their money on a bunch of stupid crap, but that’s not all of it.
When you see a guy making a five-year contract for $50 million, let’s say, first of all the likelihood that he is ever going to finish that five years at that team for that deal is very slim. Is he gonna get injured? Is he gonna get traded? It’s not like he suddenly gets a big check for $50 million. That’s number one. And number two, he gets that paycheck and the first thing that’s gone are the taxes. The next thing that’s gone is the agent fee. The next thing that’s gone is the management fee. So the $400 million, for example, that Mike Tyson generated, I don’t think that was net income. I think that was gross income. And what happens is they get married while they’re still a professional athlete, so they’re traveling a lot, they’re getting a lot of outside adulation. Then they retire and what happens? Now they’re at home seven days a week. They’re not getting the constant attention from the outside anymore, and now it’s just you and your spouse and your kids and it doesn’t take long at all for these marriages to dissolve. That is just the reality of it, and that could be, boom, 50 percent of your net worth right there. Gone.
It’s pretty bleak when you lay it out that way.
There are the fun moments of the preposterous purchases, and then you kind of deal with the harsh reality. We felt that Broke had multiple dimensions. It wasn’t just about going broke. It was about a system that seems to be broke and a mentality that seems to be morally bankrupt at times. And if something’s broke, you wanna fix it. I think smart is the new stupid. It used to be cool to be ignorant, to just throw money in the air at a strip club. I think what’s happening now in the face of the economic downturn is it’s kind of uncool to be ostentatious. It’s cool to say, as Bart was told, why live like a king for a day when you can live like a prince for the rest of your life?
Money manager Ed Butowsky invented a “financial distress calculator” that determines the number of years before an athlete will go broke. Have you seen athletes get surprised when they calculate that number?
Oh yeah, it’s impossible not to get wide-eyed over it. It’s a pretty amazing thing, particularly when you’re plugging in the big figures. Because the bigger the salary gets, the bigger all the line items underneath it get—the more money players are giving to their moms and their dads, the more money they’re spending on friends and family and a bigger house. Everybody lives up to that paycheck. That’s the scary thing.