Every time I watch what amounts to a bunch of people mostly my age or younger beating each other up while making no less than $340,000 a year (and often much MUCH more), I’m a little bit flabbergasted. I made about 15% of that when I started my first job – and I had NO idea what to do with it. It was about 10 times more money than I’d ever made in my life, and I thought there was no way I could spend it all. Granted I sure found a way to spend it (and then some), but the fact remains that I made more than enough to meet my needs, and even enough to fund most of my wants. When I think of NFL players making $340,000, I can’t help but wonder how many of them actually manage it well.

My advice to NFL Rookies

It’s always been my secret dream to be a financial planner for an NFL rookie – or really anyone who suddenly makes an absurd amount of money at once. $340,000 after taxes would be at least $225,000, and maybe more depending on your filing status, deductions and other income. That means every NFL player is bringing home AT LEAST $18,000 each month. If I was advising them on what to do with that money, here’s what I’d recommend:

1. Only talk money with people you trust. Simply put, when you come into money there will always be people out to get their hands on it. Stay away from loans to friends and family, don’t invest in any businesses, and don’t let just anyone advise you on financial transactions like stock purchases. Of course I would also tell someone to hire a financial advisor they trust…but I would hope I was that person!
2. Buy what you can afford. You need a house. And a car. ONE. Maybe two. Buy cars in cash, and take care of them. Finance a house if you need to, but don’t buy more than you can afford or need.
3. Buy in cash. If you’re making $350,000+, you can probably forego credit card rewards. Pay for things in cash so you always know where you stand, never miss a credit card bill and stay away from accrued interest.
4. Education matters. If you didn’t finish your degree before joining the world of professional athletes, consider going back to school while you can afford it. Even one class per summer or semester can help you chip away – and help make sure you have something to fall back on if your athletic career comes to an end. You could even follow the example of one of my favorite pro athletes from my alma mater and get another degree!
5. Give some away…but not too much. If you tithe, make sure you are sending money to a church you can trust. I understand players who come from financially strapped households want to share the wealth. That’s ok – give some to your parents, or siblings. But make it clear it’s a gift that you are choosing to give, and that you are not obligated to give in the future. Make a habit of giving on YOUR terms – not in response to a request. And remember that gifts can have tax consequences to the gift-giver.
6. Get good insurance. I’ve actually been wondering if NFL players are even eligible for long-term disability insurance – why would anyone want to insure that kind of income in such a dangerous job? Assuming it does exist, get it. Even though premiums are likely to be outrageous, that’s precisely the kind of thing you SHOULD spend your money on. So do it. And while you’re at it, make sure you’ve protected your family by purchasing an appropriate amount of life insurance for both you and your spouse.
7. Save for the future. If there’s ever a profession where you should spend only what you need and save the rest, pro sports is it. You will undoubtedly NOT be an NFL player longer than you will, so saving now allows you to continue to be comfortable in the future. Maxing out retirement accounts won’t be enough for someone making this kind of money – so in addition to the NFL pension, a 401(k) and IRA, you should also consider taxable savings accounts.
8. Speaking of taxes…Of course you should also hire a tax expert to help you avoid taxes legally – don’t get in trouble for tax evasion or tax fraud!
9. Know that it won’t last forever. If you have big goals, fund them while the income lasts. Put away enough to send your kids to college. Pay off your house. Take the dream vacation. And prepare now for the fact that the dream job and related income will likely go away…but your financial stability doesn’t have to.

On some level, the mistakes of new earners probably apply to pro athletes too – just on a bigger level. But even more responsibility comes with earning a big salary that could very well last for only a few years. If saved and invested wisely, even three years of a minimum salary should be enough to see someone through retirement – that adds up to over $1 Million, which is a higher lifetime income than someone working for 20 years at an average of $50,000. If any NFL players want me to expand feel free to contact me – I promise not to write about it here!

What advice would you give to pro athletes? And how can all of us learn from that advice?

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While I was shopping the deals on Amazon yesterday, I started browsing the most expensive Amazon Christmas gifts and found it very amusing.

In case you just happen to be looking for some ideas (or you need a break from holiday shopping and need a laugh), here are the most expensive Amazon holiday gifts by department to ship to your friends and family this year!

Most Expensive Gift Ideas

• Baby: Elite Serenity Bath Tub: $84,000.00. The person who wrote the review thinking they bought an oil drain bucket for $84 is entertaining.
• Beauty: Photo Therapy Machine: $25,999.00. The day I checked, it was on sale for 13% off, so if you’re in the market for one of these, I guess you should buy it on sale, right?
• Clothing: Russian Sable Fur Coat: $46,500.00. These coats are on close out, so you’ll save almost $40,000!
• Electronics: LifeSize Room Video Conferencing Kit (No Phone): $10,649,998.94. No phone? For that price, can’t they throw in the phone?
• Grocery and Gourmet Food: Sticky Fingers, Scone Mix Original – 12 Pack: $9,005.38. I’m a big fan of buying in bulk; if you calculate the unit price, it brings the cost down to $1,500.90 for each one.
• Home, Garden, and Pets: 1.5″ Rhodochrosite Carved Crystal Skull: $4,800,566.00. Nobody on my list specifically asked for for a crystal skull, but I’m sure it would make a good stocking stuffer!
• Jewelry: Certified Diamond (Oval, Fair cut, 15.19 carats, G color, VS1 clarity): $789,780.00. Thinking of proposing? You can usually get a better deal on diamonds online, right?
• Industrial and Scientific: N82S212N: $348,018.75. The only description is a General-Purpose Static RAM, so I’m guessing it must be popular enough that it will sell itself.
• Musical Instruments: Bob Dylan Hand-Signed Series – Set of 7 Harmonicas: $25,000.00. My three year old asked for an instrument for Christmas. Do you think he’d treat these harmonicas with love?
• Music: Introducing the Beatles: $125,000.00. It’s in vinyl, so if you are planning on giving this as a gift, maybe you’ll want to combine it with a classic turntable too.
• Office Products: Pez Outlaw, Life on the Run – Movie Rights: $315,000.00. I noticed they are also selling the book rights too, but it looks like that will set you back another $315k.
• Shoes: BALLY Mae Bowling Bag: $3,195.00. Why is the most expensive pair of shoes a bowling bag?
• Software: Avocent DSView – License: $140,866.48. Software to provide “data centers with secure, centralized management for physical and virtual IT assets.” Ok. Next.
• Toys and Games: Sports Play Modular Playground: $50,441.40. Skip the swingset, you can put an entire playground in you back yard. However, with over $7,000 in shipping charges, it looks like this playground won’t qualify for Amazon Prime free shipping!
• Home Improvement: Meyda Tiffany 8 Arm Chandelier: $360,000.00. There’s free shipping on the chandelier, but I can’t tell if they will install it for you.
• Video Games: DSi TekCase in Pink: $99,999.00. Since there are two color choices, you might as well buy the black version for $53.89.
• Watches: Men’s Portuguese Tourbillon Mystère Watch: $88,800.00. I love the fact that if you buy 2, they’ll send you a $25 Amazon Gift Certificate!

Just for clarification, I did have to skip some of the most expensive gifts, since it appeared that sellers were trying to list a maximum price just to be at the top of the list. Where possible, I excluded those to try and find the actual most expensive gift ideas.

Ok, now that we’ve had some fun checking out the expensive Christmas gifts, let’s head back to reality and focus on our frugal holiday gifts for family and friends.

If you had an unlimited budget this holiday season, which gift would you give to someone on your list?

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© My Dollar Plan

The million dollar number is often set as a personal goal for many people. Has anyone ever gone the other way and made it to the dark side of a million? Could someone really owe $1 million? And I don’t mean holding a $1,000,000 mortgage, I mean someone who has a negative net worth of that much.

Emotions and Money

There are many instances when the emotional side and the rational side of money are confused. I’d like to say that earning, saving and investing are all just numbers, but I know better. I know that money makes you think in funny ways. For example, I will Sell Coupons on Ebay for a couple dollars but won’t Sell the Car to save thousands. It doesn’t make sense.

Even though emotions are present in all levels of wealth, does the $1 million number elicit more emotional attachment than other milestones? After all there are many blogs that are detailing the trip to $1 million already or in the future:

• Million Dollar Journey
• Million Dollar Countdown
• Millionaire Mommy Next Door
• 2million is even documenting the trip to $2 million

Would the same magical number hold true reaching a negative net worth of $1 million? Would it make people think differently, act differently or approach debt differently?

The Search

As you can imagine, I didn’t find anyone (excluding famous people and corporations). Which, I’m actually pleased about. What I did find is interesting:

1. I searched networthiq and found the person with the lowest net worth to be person 334442debt at ($367,535). However their user id leads me to believe that their net worth has actually gone down since they joined. In addition, I noticed that the comments include a goal to get out of debt in 24 months. That sounds pretty tough.
2. The families highlighted on Oprah recently revealed only the amount of debt they had, $300,000 ($230,000 in student loans and $60,000 in cars… hmmm… that doesn’t add up), and not their net worth. Although not likely, they may actually have a positive net worth.
3. CNN Money highlights a family that has a net worth of ($445,741) and it looks like they are going to keep going backwards for the near future. This could be the family that can make the negative millionaire status. Hopefully they will provide updates! (Credit to Living Almost Large for finding the family in: Bergmans…millionaire?)

Here’s some bloggers in the negative that I found:

• ($39,083) Blogging Away Debt
• ($114,409) Mrs. Micah

I searched up and down and found lots of people in debt, but not $1 million. Apparently it’s tough to get close to a negative $1 million. Or the credit bureaus cut them off. Maybe we won’t ever know if there is a negative millionaire out there.

And so my search continues… ideally I don’t really want to find anyone in this state, as I want everyone to succeed financially. It was a fun challenge though!

Read the third article in the millionaire series when I look at our credit cards and lines and see if we can’t hit $1 million in credit limits!

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