By Paul Morrone CFP®, CPA/PFS, MSA
It seems like every week there is a new story about an athlete that was burned by their financial advisor. A quick google search on this topic will yield more results than you care to read, but there is one common thread throughout all of these stories. Seduced by the potential of massive double and triple digit returns, many athletes dumped millions into speculative investments in casinos, real estate, private equity and other businesses that were moonshot ventures at best. They also implicitly trusted their advisor when in fact they should have been doing more due diligence as to how their life savings was to be invested. While putting capital at risk is an inherent part of investing, putting a significant portion (if not all) of one’s net worth into illiquid, risky and unproven programs can spell disaster as evidenced by the stories of Clinton Portis, Mike Tyson, Darren McFadden and Tim Duncan, to name a few.