Bankruptcy isn't just for the low income or unemployed. The debt relief practice is the right of every American citizen, and celebrities are no exception. That should come as consolation to the some 78 percent of NFL players and 60 percent of NBA players that Sports Illustrated reports claim insolvency within two years of retirement.
Just this month, former defensive lineman and Dancing with the Stars contestant Warran Sapp joined fellow athletes Lenny Dykstra and Allen Iverson in bankruptcy proceedings. The 39 year-old owes nearly $7 million to creditors, along with back child support and alimony payments associated with his 2007 divorce. Sources around that time said Sapp was ordered to pay $15,000 per month for two of his four children and some $45,000 per month in alimony.
According to documents associated with his recent Chapter 7 filing, the former pro-athlete has $6.5 million in assets, including $6,500 worth of Jordan brand shoes. His current monthly income is around $116,000. He has continued to earn money in the television industry by making celebrity appearances and delving into a post NFL reporting career.
While many may scoff at Sapp's predicament, the financial woes faced by professional athletes can serve as a good reminder that no one is immune to money woes. Poor planning, lack of education, overspending or an unexpected turn of events can all lead to a declaration of bankruptcy. And though debt management is usually preferable to insolvency, a Chapter 7 filing might be the best way to get back on the road to recovery.
Source: The Washington Post, "Warren Sapp: The latest multimillionaire athlete to file for bankruptcy," Matt Brooks, April 9, 2012