QB Michael Vick seemed to be en route to “living the life” after signing a massive six-year, $100 million contract with the Philadelphia Eagles just last year.
If only it was that simple.
Since filing for bankruptcy in 2008, Vick has reportedly spent $29.6 million of the $31 million he has earned. Don’t get me wrong, a mere $1.4 million dollars is a decent chunk of change to have retained, but it is not really the cash flow needed to live the lavish lifestyle experienced by many high-paid NFL superstars.
The majority of this money was used to pay off Vick’s creditors, with whom he drove up millions upon millions of dollars in debt while he was a member of the Atlanta Falcons.
These creditors include Vick’s former agency Joel Enterprises Inc, the Royal Bank of Canada (owed a reported $2.6 million), Wachovia Bank NA (a reported $1.1 million) and the Falcons.
The Falcons were originally looking for up to $20 million from Vick for bonus cash collected from his 2004 contract. Vick and the Falcons have since settled in court, reducing that claim to around $6.5 million owed by the quarterback.
Under his current payment plan, Vick is allowed about $300,000 in living expenses annually, which includes rent, his children’s school, food and automobile payments. Vick has paid his lawyers and accountants around $2.7 million since his filing.
At first glance, Vick’s big contract may have seemed solely beneficial to the man himself, but in reality it was his creditors who came out on top, because with the more income Vick brings in, the larger the percentage of money he has to pay off.
In the end, it is still a positive situation for Vick, because under his $100 million contract, he will likely be able to pay off all of his creditors by 2014. It is always beneficial to be free of debt.
If Vick can continue to live a “modest” $300,000 a year lifestyle beyond 2014 when he is out of debt, it would do wonders for his financial security. Especially because after Vick’s current contract expires, he will likely only have a few years remaining in his football career as he is already a 32-year old man right now.
Hopefully this is a wake-up call for Vick financially and he will be able to manage his money appropriately after his NFL days are over.
If not, another future bankruptcy filing from the controversial quarterback is not a far stretch.
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