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HOUSTON (CBS Houston) — It seems like daily we are hearing stories of ex-professional athletes who once made millions of dollars but now are flat broke.
Don’t expect to hear any such tales about former Texans guard Chester Pitts. In the cold reality where we can expect nearly 80 percent of the NFL to either be broke or suffering serious financial hardship just two years after leaving the game, Pitts is the exception.
He’s different because he handled the money he made during his nine-year NFL career wisely and now he is looking to help educate others who have suddenly become rich to make smarter decisions with their money. Pitts has began his new career as an executive consultant with ZTWealth and soon hopes to become a certified financial consultant for the Houston firm that helped manage his money.
“Every Wednesday during the offseason I had to go to the office,” Pitts of how it all began with ZTWealth. “I had to sit down, sit down and take notes and shadow either one of them for the entire day. Hirings, firings. You name it I was exposed to it and that is what helped me grow as far grow and really having an understanding.”
While sometimes having the reputation of the jokester in the locker room, Pitts always took his career and the money he made from seriously. Instead of spending freely as many of his teammates did, Pitts put himself on a budget that allowed him to live a great lifestyle while not being overly extravagant.
The result is now the 32-year-old retired NFL star works because he needs something to do and not because he has to.
“I’m not the average cat and I can say that with a straight face and no one would ever think I’m trying to put myself up on a pedestal or anything like that. It takes some discipline, it takes hard work,” said Pitts, who played one season for the Seattle Seahawks in 2010 after spending his first eight years in the league with the Texans. “It’s plenty of times I would see a Ferrari rolling down the road and I’d say to myself `Yeah, I can write a check for one of those. But after driving it three or four times am I going to feel the same way about the car?’ So if I’m feeling that kind of way then go rent one for the day or for a weekend. But you are going to be over it pretty quickly and then you going to say that cost me $600, what would it had cost me to own this thing, $200,000?”
But in all honesty, Pitts says athletes don’t lose their money because of poor decisions about buying cars as much as they lose their money through bad investments. He says investing in restaurants, bars, clubs and sometimes real estate can drain wealth quickly.
“Poor investments are the fastest way you lose money. You invest $500,000 and the deal goes bad,” he said. “Just think how long it would take to go through half a million dollars. It takes more time to blow money that way than if you invest in a deal and the deal goes bad and those cases you have absolutely nothing to show for it. At least if you buy something you can sale it. You might not get what you paid for it but at least it’s something.
“Definitely the biggest thing in the education is being able to break a deal down. The structure of deals and deal analysis that’s another thing that is part of it all.”
Obviously many of his contemporaries aren’t as knowledgeable and it has hurt them. The numbers tell it all. In the NFL, 78 percent of former players have gone bankrupt or having serious financial problems just two years after many of them retired from making millions. The NBA isn’t much better where 60 percent of the players are broke within five years of retirement.
And if the numbers don’t necessarily hit home then the names we not celebrated not long ago like Warren Sapp, Terrell Owens, Allen Iverson should. In recent months we’ve heard stories of how these three one-time top dollar earners are now in serious financial straits.
Sapp, who made more than $60 million during his career, filed for Chapter 7 bankruptcy recently because he has $6.7 million in debts and assets worth $6.45 million.
Pitts feels part of his calling as a financial advisor would be to help cut down on these types of stories by educating athletes about their health and more important how to build a responsible lifestyle that will allow you to hold on to your money for many years after retirement.
His advice won’t be free and it may not come cheap but the dividends could be extraordinary.
“It’s one of those things where it isn’t charity work. I’m working,” said Pitts, who was a starter for the Texans for seven straight seasons before suffering a serious knee injury in 2009. “But ask Warren Sapp, T.O. or Allen Iverson what is it worth to maintain let’s call it 50 percent of the best that they’ve lived for 50 years? With a little bit of education, a whole lot of planning that is extremely feasible. That’s kind of where the rubber meets the road.
“They (ZTWealth) didn’t do it for me free but every dollar that was spent was absolutely worth it because I haven’t played in a year and my transition was seamless, doing just fine, living and I don’t have to work. I’m just 32 so what else I am going to do? I can only take my son to soccer and as far as making sure he is good.
“So what greater move than something I’m truly passionate about?” he continued. “I’m going to wake up and go do this and I’m excited to do it.”