This experiment began several years ago when I received a brochure in the mail advertising silver bullion coins as an investment vehicle. The “hook” was, “We will sell you two silver eagles for the price of one, if you agree to read our special report on silver.” When I saw this, I thought, “I could give one of these coins to a friend who was having money problems as a touch point for her prayers.” I sent her a coin and a notebook with instructions. Every day we prayed that the Lord would grant her wisdom in the area of finance. Every day she made an entry in her notebook.
The initial experiment was extremely successful. At the end of six months, her attitude towards money was radically different. She began to systematically eliminate her consumer debt. She changed some behaviors that were sabotaging her financial situation. Then towards the end of the six month experiment, she was able to move into her own home for the first time in her life.
Finally, when the participants are ready, they will give their coin with a blank notebook to a friend or a family member who is ready to change their relationship with money. In this way, friendship and blessings will keep flowing forward forever, even into eternity.
So when is a 22 year old man simultaneously a 62 year old man?
Answer: When he is a rookie in the NFL. Three years to retirement.
In a recent article in USA Today entitled “Future NFL Rookies Should Heed Hard Lessons About Dollars and Sense,” Jarrett Bell explores the dangers and pitfalls facing the young men about to be selected in the NFL draft. Phillip Buchanon, formerly a first round draft pick, who enjoyed a ten year career as a cornerback in the NFL has written a book titled New Money: Staying Rich about his experiences with money as a professional athlete.
His first lesson: “Don’t spend money that you don’t have.” Buchanon, like many other young athletes found himself a million dollars in debt before he signed his first contract. Unscrupulous rascals offer a form of the payday loan to college students on the cusp of a NFL career—at 20% interest rates.
Then there are the relatives, the friends from the “hood,” and the hangers-on that want to become part of a posse. Buchanon’s mother demanded $1,000,000 from her son as payback for his upbringing!
Patrick Kerney, a former NFL defensive end who has taught players the basics of handling money for many years recommends, “Boring, dull, and ugly,” low cost index funds.
There are simply too many horror stories of NFL players being victimized by sophisticated “investment advisors.” I remember that Tony Dorsett ended up in serious financial trouble as a result of thinking he could outsmart the men who inspired the J.R. Ewing character on television when playing games with oil futures. That was legal! Too many times these young men are the victims of outright criminal fraud. The article notes that the financial habits of NFL players are improving. However Kerney laments, “Now the big thing is they are buying annuities, where the insurance companies take and do with their money what they should be doing. That’s not as bad as throwing money at a venture capital situation, but there is a huge opportunity that is lost.” Annuities are some of the most overpriced financial vehicles out there. I haven’t yet seen any currently offered retail annuity I could recommend.
Mike Tyson managed to loose over $300 Million to unscrupulous promoters, investment advisors, friends, attorneys, and ex-wives. A man who once picked up a $173,706 gold chain lined with 80 carats in diamonds is now bankrupt. Tyson has reportedly bought 110 cars during his lifetime. I have read that he has lost, just lost, twenty Rolls Royce automobiles. He simply doesn’t know what happened to them.
While most of us will never have the opportunity to squander $300 Million, let’s hope we can learn that managing our money is a simple yet difficult discipline. As long as our income exceeds our expenses it’s OK.
I don’t know who said it but it is true, “If your outgo exceeds your income, you upkeep will be your downfall.”