Originally Posted by medford
In a bank, you're only secure up to 250,000, or whatever they raised it to recently. Not near as much security there as there is in a well diversified investment plan. Coke is a great american company today, it was yesterday and it will be tomorrow. If you invested 5% of your fortune in Coke, its not going to just disappear tomorrow. It may go down, but it won't just dissapear. Now take the remaining 95% and invest it in McDonalds, real estate, energy, drug companies, bonds, etc... and you've got a fairly solid diversified account that can sustain you for many years, much better than the 1-2% you get in a bank that is going to continually lose spending power due to inflation.
also, like I said earlier, most people don't become millionares by being complaciant w/ what they have, they strive for something better.
Most Millionaires became that way because they were smart. Athletes aren't falling into that same category, so maybe they would be much better off being complacent with their millions of dollars that they HAVE and not worry about losing a small bit due to inflation here and there.
I would much rather take my chances just being happy with the millions and millions of dollars that I made than risk it on these things. So what if I am losing a small percent of that each year. Its going to happen anyways as I spend it.
The real problem is still a lack of education on the grand scale.