We often see the glitz and glam of professional athletes signing multi-million dollar contracts, but seldom do we get a peek behind the curtain at what truly happens to that money. In a candid conversation, Josh Childress, a Stanford alumnus and former NBA player with career earnings surpassing $60 million, unpacks the financial intricacies faced by professional athletes.

Despite now earning less than he did during his NBA heyday, Childress has successfully navigated the financial pitfalls that trip up some of his peers. His financial journey began in earnest when he became the sixth pick of the 2004 NBA Draft, inking a rookie contract worth $11.7 million for four years.

According to Childress, one of the primary errors athletes make is misjudging the actual size of their paychecks. “People say, ‘Okay, I’ve got $11 million,'” Childress shared, “You’ve got five [million dollars after taxes] over four years.” The lifestyle expenses, from purchasing million-dollar homes to buying cars for themselves and their family, can rapidly erode that seemingly massive paycheck. Agent fees and the NBA escrow further nibble away at the remaining funds.

But perhaps an even more insidious financial danger lurks in the form of peer pressure from higher-earning veteran players. Childress notes, “Some of my veterans spent a little more than others. If those are the guys taking you under their wing, that’s what you get used to… you end up spending way more than you should.”

While Childress admits that he wasn’t immune to this influence, he managed to keep his spending under control.

His experience is a fascinating insight into the high-stakes financial game that unfolds off the court. It’s a stark reminder that, whether it’s sports or business, prudent financial management is as crucial to long-term success as any slam dunk or buzzer-beater.