How does a professional athlete sign a contract and earn a certain amount of money but have a lower net worth than the amount they earned?

Question

I was looking over the net worth of a specific baseball player and it says his net worth is between $6 million-$15 million. But in the same article it says he earned $51 million playing four seasons in the majors. If he earned $51 million how is his net worth $15 million max?

In: 5

Answer 1

The same way any person could earn $50,000 per year (that’s $200,000 over 3 years) but not have $200,000 in their bank account. They spent most of the money instead of saving it.