In case you missed the Twitter thread by former NHL player Chris Pronger, this is quite a fascinating read:
I played 20 years in the NHL. I was one of the highest earning NHL players of all time. And friends with many other pro athletes. My guess is more than 50% of pro athletes have financial issues in retirement.
When you hear about X player making $30M over 5 years ($6M/yr) you think wow he made it. However that is not always the reality, in this thread I am going to break down how much they take home and where the rest of it goes.
Replying to @chrisprongerFor this thread here is the example: X player gets $30M paid over 5 years and earn on paper $6M a year. Here is who they pay: Right off the bat escrow gets taken out of every check. On average about 10%. Most people have no idea about escrow.
This is money that the NHL withholds from players in case the 50% revenue share is not met. In most cases the player never sees this money again. So that’s 10% $6M salary minus escrow (10% avg.) - $5,400,000
Next are federal taxes - 37% We get bi-weekly checks (13) during the regular season. For each of those checks the gov’t gets 37% +- • $2,000,000
Now you have to pay the local tax. That could be 0% like in TX & FL or as high as 16% in NYC. For this example let’s use 8%. There is another 8% • $432,000
Next is agents. They vary but typically the average is 3%. BTW that is 3% of the gross not post tax. So there is another 3% • $162,00
So let’s total this up now. Player X is now netting $2,806,000. That is a lot of money! But now they have to spend a little more money to do their job effectively. Housing. Typically players are not from the city they play in so they either rent or buy a house (rent $5k month)
For health you typically have a chiropractor, masseuse and trainer that you are paying for in and out of season. ($20k/yr) Vehicle. Need to get to and from practice and games. ($75k) And finally nutrition. Nutritionist and food are $6-7k a month. ($60k/yr)
Now this is all the expenses just to be doing their job at a high level and not living the high life. Which certainly happens but not on this thread. Just a reminder these are averages and not fact!
So Player X is netting $2,591,000. Which is around 43% of the total number. Now keep in mind the average career is 4 years and the average salary is $2M. So yes this is still a nice amount of money but most people don’t realize how much comes off the top before they get to invest.
Also keep in mind I am not including when athletes seasons are over they typically go somewhere to relax and unwind. Nor am I including a number of other ancillary expenses that typically come up. For me it was the odd suspension.
I hope to keep sharing stories on Twitter (so long as you people like reading them!). So, give me a follow if you want to hear more. And comment on this thread and let me know what other stories you want to hear. Thanks for reading!