Wealthy sports stars forced to save for retirement

Finally, there is some recognition that money management skills are needed at every level of society. It no longer about the less well-off, even the ridiculously wealthy need help too!

In the US, National Basketball Association players, who were paid an average of about US$5 million last season, will be forced for the first time to save money for retirement.

NBA athletes forced to plan for retirement
Wealthy sports athletes forced to plan for retirement

The program is part of the 10-year collective bargaining agreement between the NBA and the players union that ended a lockout in November.

Former NBA players Scottie Pippen, Latrell Sprewell and Antoine Walker are among retired professional athletes who have experienced financial difficulty after careers in which they earned tens of millions of dollars. Antoine Walker filed for bankruptcy after being paid more than $100 million over 12 years in the NBA.

Retired players can access the money before their pensions begin at age 50. Players can take an early pension at 45, Klempner said.

Basketball-related income in the NBA will top $4 billion next season, meaning the amount of forced savings also will rise.

Beginning next season, players also will surrender 5 percent to 10 percent of their salary for retirement. They automatically will be enrolled in the program and would have to opt-out to keep from participating in the plan.

Investment details for that plan aren’t complete.

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