How stars so rich and famous can go broke

The San Francisco Chronicle reports:

Sports Illustrated estimates that 78 percent of former National Football League players, within two years of retirement, are bankrupt or "under financial stress because of joblessness or divorce." Within five years of retirement, an estimated 60 percent of former National Basketball Association players "are broke." And at least 10 major-league baseball players fell prey to alleged fraudster Robert Allen Stanford, the magazine says.

For each failure, there is usually a reason: a lawsuit, illness, injury, divorce, unexpected tax bill or bad investment. Those are the same things that throw ordinary folks into bankruptcy, but celebrities face challenges most of us don't.

One is that their careers are highly uncertain and often brief. In the business world, it's fairly easy for someone with a seven-figure income to guesstimate their future earnings, says Ken Naehu, a managing director of Bel Air Investment Advisors in Los Angeles.

An interesting article.