Wednesday, December 07, 2011

When Will They Learn

The NBA locked has ended. The day after the NBA lockout ended, some NBA players were partying at nightclubs and some were partying before the lockout ended. Some NBA players were experiencing financial issues during the lockout. Those who weren’t, partying is just a slap in the face to players struggling to pay their bills. No matter what your financial status, nothing last forever so it’s best to plan ahead and plan for the future. The NBA will probably experience another lockout so players you better be prepared. Here are 8 tips on how to lose your NBA salary:

1. Buy more than 1 car with a price tag of $300,000 or more.
2. Spend money on women, sneakers for everyone in your old neighborhood, buy drinks for everyone in the club or buy clothes for all your friends on a regular basis.
3. Blame everyone else except yourself for your financial problems.
4. Let someone else sign your checks.
5. Buy a home the size of Texas.
6. Spend your yearly salary in three montha.
7. Buy a plane, jet, yacht or something else equally as expensive.
8. Hire underhanded staff who steal all of your money.

Some NBA players make millions a year, some make over $200,000 a year which is enough to prevent filing for bankruptcy and more than enough to be considered above middle class. Unfortunately, many NBA players don’t know how to manage their money and don’t take the time to learn how. Many live paycheck to paycheck like some Americans, except their paycheck is larger. Here are 12 financial tips to ensure that you don’t file for bankruptcy, lose your home to foreclosure or have to work at Regency Furniture Showroom.

1. Create a support network. Hire an accountant, lawyer and financial advisor. Develop a great relationship with a banker and loan officer.
2. Learn about finances. Take a personal finance course, reach a book on personal finance or watch a television show to learn the basics about finances: learn how to invest, how to make your money grow, how to read financial statements, etc.
3. Know your worth. Know your net worth every year. Subtract your total liabilities from your total assets to determine your net worth. If the value is negative, you need to adjust your spending.
4. Reconcile. Reconcile your financial statements monthly but no less than every 3 months. Verify your account to ensure there are no errors and verify all your money is accounted for.
5. Set a signing limit. Set a signing limit for someone on your staff to sign checks for you if you don’t want to sign checks for small amounts. However, the advice Bill Cosby gave to Oprah was to sign your own checks and Oprah said she still signs most of hers.
6. Reduce spending. Reduce monthly expenses by 30% – 50%. Try to live off 60-70% of your yearly salary and save the rest of the money.
7. Unexpected. Create an emergency fund that has enough money to cover all of your monthly expenses for 9-12 months including child support.
8. Grow your money: Invest at least 20% of your monthly income after taxes, start a business or invest in a profitable business to grow your money.
9. Branding. Get as many endorsements as possible; create a website or blog or social media profile, create a logo, slogan, nickname or motto to establish a brand. Once you establish a brand it opens the doors to many other opportunities for generating income.
10. Get sponsors. Instead of throwing parties and paying for them yourself, get sponsors to pay for a portion or pay for the entire party. You can also have sponsor product giveaways for attendees. This saves you money and helps promote the sponsor’s products.
11. Inner Circle. Surround yourself with friends who having good spending habits who can provide advice on how to manage your money and help your money grow.
12. Think about tomorrow. Don’t live your life day to day, think about how you want to live your life in the next 5 - 10 years: where do you want to live, what lifestyle do you want to have, how will you earn money when your career is over, how will you pay child support, etc.


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