Super Problems

Is it worth it?

That’s what I wondered when I read that Vince Young, former college football star and NFL Rookie-of-the-Year in 2006, had filed for bankruptcy. In his heydey, VY made over $50 million per year as a quarterback for the Tennessee Titans. He played in the Pro Bowl two times. And yet a massive salary and endorsement deals weren’t enough.

Young is just an extreme case, but the average NFL career lasts just over three years and results in career earnings of about $4 million after taxes. Invested in a diversified, liquid portfolio, such a nest-egg could produce a sustained, growing income of only $100 to $150 thousand per year.

Most of us would find it such an annuity fairly comfortable. But these athletes receive all this money when they feel invincible but are actually quite vulnerable. If they don’t spend it on a lavish, consumptive lifestyle, they invest in illiquid, concentrated ventures, like a restaurant or real-estate business—fields that are highly competitive and frequently fail. In addition, they often finish their football careers with serious injuries that make it difficult to work in a new career and leave them with big medical bills.

People are social creatures. We tend to behave the way our friends do. When the culture is imprudent, it’s hard to be careful with our money.

Douglas R. Tengdin, CFA

Chief Investment Officer

By | 2014-02-04T10:13:51+00:00 February 4th, 2014|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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