Many of our Escondido readers probably saw the surprising news about former Los Angeles Kings hockey player Jack Johnson and the reports about his financial troubles. Johnson, who now plays for the Columbus Blue Jackets, is set to earn a salary of $5 million dollars this year. But, despite having an income that most people could only dream of, Johnson has filed for personal bankruptcy.
However, as with most bankruptcy filings, there is much more to Johnson's story. According to the reports, Johnson's parents were the ones who used to be in charge of his finances. The reports indicate that they did a less-than-stellar job.
In 2011, back when Johnson was playing for the Kings, he signed a seven-year contract worth $35 million. Shortly after that, his parents reportedly started to take out high-interest loans against his future earnings. Some of the money was used to purchase property in California. Other funds were reportedly used for the purchase of a car and for home improvements. Johnson was apparently unaware of how badly out of control his financial situation was getting. In filing for bankruptcy last month, Johnson reported debt in an amount upwards of $10 million. He reported assets of less than $50,000.
This story just goes to show that oftentimes there are unexpected circumstances that can lead to a bankruptcy filing. The point remains, however, that filing for bankruptcy can be an option to help deal with even the most troubling of financial problems. For Johnson, now that he has discovered the problem and has started taking steps to fix it, hopefully he will have enough of a playing career to make up for some of his financial missteps with his future earnings.
Source: The Washington Post, "Columbus Blue Jackets' Jack Johnson is bankrupt, thanks to his parents," Matt Bonesteel, Nov. 20, 2014