Former NBA No. 1 draft pick Joe Smith earned $61 million over his 16-year career. Today, he's living paycheck-to-paycheck and owes $157,000.
"A lot of people think once you sign that contract, you're just an automatic millionaire," Smith told former MLB star and businessman Alex Rodriguez on CNBC's Back in the Game, in which Rodriguez helps former pro athletes get back on solid financial footing.
"But it doesn't work like that. Nobody really explained that and broke that down to me, that Uncle Sam, out of that $3 million, Uncle Sam is going to take probably $1.5 [million] of that. That was just something I had to learn."
While Smith collected $61 million in total earnings, after taxes, agent fees and management fees, he actually took home about $18 million over the course of his career. Still, that's more money than most Americans ever see in a lifetime.
Thanks to reckless spending, bad investments and a costly divorce, Smith found that his fortune had been completely wiped out. And his salary, which was never less than $1.3 million a year while he was in the NBA, plummeted after he retired in 2011 and switched to coaching 10-to-15 hours a week.
Smith and his fiancee Kisha Chavis had been living beyond their means and, as a result, spiraling deeper and deeper into debt. To help them, Rodriguez came up with a simple two-pronged strategy: increase revenue and decrease spending.
Turning around their finances all started with facing the numbers. It was only when Rodriguez highlighted just how much they were making compared to how much they were spending that Smith and Chavis realized they needed to buckle down.
"I knew it was a big hole, but I didn't know it was like that," Smith said. "Just to see the numbers and see the breakdown just catches you off guard."
Tiger in the tale
An already heartwarming story got even better Tuesday for 18-year-old golfer Pratima Sherpa.
The aspiring professional golfer from Nepal came to the United States last weekend for the premiere of a film that chronicles how she learned to play the game despite the impoverished conditions her family faced in Kathmandu.
Her story, told in the film A Mountain to Climb, caught the attention of Tiger Woods, who invited her to a clinic he was hosting in Jupiter, Fla.
According to ESPN, Woods gave Sherpa a 40-minute private lesson before the clinic started.
Woods first learned of Sherpa's ambition to become the first professional female golfer from Nepal in a Golf Digest story. She said a letter he sent to the Royal Nepal Golf Club, where her family lives in a maintenance shed off the third hole, continues to inspire her to play well.
Last year, she fell four spots short of qualifying for the LPGA Tour, but she continues to compete as an amateur.
"It's special she was here for a day with my foundation," Woods told ESPN. "It demonstrated to all of us what hard work and belief in yourself can accomplish. The story of her journey is inspiring. We can all learn from what she's done."
Sports on 04/27/2018