Football Bankruptcy: Why 2 in 5 Players go Broke

When you think of professional footballers and money, you imagine them making lots of it, not losing it, but a recent investigation found that two in five players encounter financial problems during their careers or in retirement. 

This was highlighted this week by the news that former West Ham striker Carlton Cole had been declared bankrupt, despite at one time earning £30 000 a week. 

The apathy towards footballers and their finances – and there is, at best, an apathetic attitude – ignores certain facts: the mega-earners are the rarefied tip of a gigantic, worldwide footballing iceberg.

The sport’s agents are not regulated; 33 per cent of ex-professionals in the UK go through divorce within a year of retiring and a career might be 15 years but could be cut short at any moment. 

As much as there evidently is a problem, in this country and elsewhere, though, there can often be scant support for footballers when they retire.

Incremental steps have been taken in this country, with the Professional Footballers’ Association providing financial advice and a pension scheme, as well as Sporting Chance Clinic, a 24-hour helpline to assist players with addictions, mental health issues and debt problems. 
Former south African footballer Loreto Chabangu is Reportedly Bankrupt 

But there can be limits to the reach of organising bodies, and many current footballers are sowing the seeds of later destitution without knowing it. Kickback tax Some ex-players, however, are attempting to change things. 

One such man is Scott Howie, a former Norwich City goalkeeper and business graduate who was on the bench when the Canaries famously flummoxed Bayern Munich in their own backyard in 1993. He is the owner of Kickback Tax, a company that specialises in claiming tax relief for players against expenses incurred on the job. 

Dealing with middling and lower-league players, Howie provides a necessary service. Chief among his motivations is the relative lack of workers’ rights afforded to footballers: they can only move club two times a year; have a limited chance of finding work outside of the two transfer windows and they have to be PAYE.

Howie – who used to do his own tax returns as a player – and his staff, former players themselves, visit clubs up down the breadth of the UK, and advise 2,500 clients, 1,500 of which are currently active. 

“18-year-olds playing for Rochdale who get paid £11,000 a year, up to Championship players who are on £800,000 a year, down to 25-year-old players playing for Workington that get £5,000 a year,” he says. 

He has little sympathy for any top-level earners being so scrupulous about their cash, but suggests that for the “bread and butter players” he caters for, an extra £1,000 means a lot. The financial reality “Most players would like to exaggerate the amount of money that actually get paid,” Howie says. 

“I’m in the position where I actually see their P60 and I know how much money they get paid. It can be quite different. 

“I think most football fans are really stabbing in the dark when they consider how much football players get paid, especially at the lower leagues. A lot of Cambridge United fans think their players are on £4,000, £5,000 a week, but £400, £500 a week is the reality of it.” 

The problem of financial woe post-football is worldwide, but can also be symptomatic of specific variables within societies.

In countries like South Africa, for example, the drop off for players can be even steeper. Sean Roberts, a former Bafana goalkeeper tells that, within two years of retiring, 80 per cent of footballers in his country are bankrupt, destitute, depressed, divorced, though usually all four. 

“It’s just guys being taken advantage of,” Roberts starts, when we talk about the level of care clubs show towards their players. 

“And they’re just not really educated enough about how their money can work for them and that it can be all over tomorrow. That’s the reality. And they’re absolutely screwed going forward, which is just devastating. I mean the stuff I’ve seen and the stuff I’ve witnessed, two good friends that I’ve played with in the past… it’s not cool.” 

Second skills Roberts takes umbrage that there is no minimum salary cap in his country, meaning wild income fluctuations in fortunes even among teammates are common. And unlike here in the UK and elsewhere, there is no pension scheme available to players in South Africa – both things he’d like to fix. 

Making it mandatory to study while playing, one of Roberts’ key priorities with his charges is to find out what their second skill is, so that they can pursue it later. He also makes them put away a percentage of their salary away each month, and a percentage of their sign-on fee too. 

If they can look ahead to the future and invest their money where possible, while living in a slightly more considered, less ostentatious way, disaster ought to be averted. But ultimately the hardest problem to fix is mental, because when the football actually stops, how do you fill the hole formerly supplanted by goals and screaming fans? 

“The biggest issue with me retiring, and I can you tell now, with 99% of players retiring, is the transition from playing to non-playing, that is huge, that is bigger than all of it. “That was the biggest issue for me, dealing with that, and I’m still dealing with it. 

Absolutely I’m still dealing with it. This is why I say it’s important to find your second skill: if you wake up one morning and you’ve stopped playing football, and you haven’t found that second purpose, there’s big shit. You know what I mean? 

Saha’s Axis Stars on the other side of the spectrum, at the elite level in Europe, former Manchester United and Everton striker Louis Saha is the co-founder of Axis Stars, a social network that serves as a one-stop shop for sportsmen to manage their contracts, discuss pertinent issues like finance, insurance, healthcare and sponsorship with each other and with independent experts. 

Saha lost money on a large investment that went wrong as a player, and has been cautious about his money since. Credulity can sometimes be the downfall of top players with so many hangers on suggesting different ventures.

“It’s not that you don’t have any information,” Saha says when asked he feels he received enough sound financial advice as a player. “It’s that the information is really hard to understand because you may not have the time to go deep into details.” 

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