Taking a Page out of Michael Vick’s Playbook: “Paying Off Your Debt”

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Just about everyone knows that Michael Vick was involved in a dog-fighting ring that got him sent to prison for nearly 2 years. No one thinks that is something to aspire to, and we’re definitely NOT excusing his involvement in such an awful and heinous crime.

However, as John Wooden said – “Failure isn’t fatal, but failure to change might be.”

Before he went to prison, Vick decided to make a change by filing for bankruptcy. At that time, almost $18 million in debt, he chose to file for bankruptcy protection before the problem got any worse. How did such a highly paid professional football player end up with so much debt? The answer is quite simple really, and it isn’t that different from the reasons that many working class people get in over their heads.

Michael Vick lived a lavish lifestyle that far exceeded even his eye-popping salary. In addition to that, he owed a decent chunk of money to his attorneys, both regarding child support matters and his civil case, for which he went to prison. He also suffered from years of really bad financial planning. All of this together snowballed into millions of dollars of unpaid debt.

Filing for bankruptcy before he went to prison was likely the first smart decision Michael Vick had made in years. Rather than let the interest accrue on the millions he owed to a variety of creditors, he decided once and for all to take his money matters into his own hands.

By filing for bankruptcy, he protected himself from getting out of prison (where his only income would be 12 cents an hour for mopping the floors) only to face an even higher mountain of debt due to late charges and interest rates.

Many have said that perhaps the wisest decision for Vick would have been to file for a Chapter 7 bankruptcy, which would have wiped out most of his debts. This would have essentially allowed him a “fresh start” after his prison sentence ended.

Instead, he decided that he wanted to right at least some of the wrongs that he had done by filing for a Chapter 11 bankruptcy.

The main difference between a Chapter 7 and a Chapter 11 bankruptcy is that a Chapter 11 does not forgive debt. By choosing a Chapter 11 filing, Vick made the conscious choice to work with his creditors to organize payment plans that would ultimately allow him to pay back the money that was owed.

After being released from prison in 2009, he began playing football for the Philadelphia Eagles. Between the years of 2010 – 2014, he drastically changed his lifestyle and lived on only a small percentage of the millions that he earned playing football. The rest of his salary went toward paying back his debts over time. To date, has been able to pay back roughly 85% of all the money he owed.

As of January 1, 2015, Vick will no longer be required to maintain the restrictive lifestyle that he has been living for the past five years, however he now says he will no longer spend money frivolously like he did in the past. One can only hope that he truly has learned his lesson.

Your take away from this story? It’s never too late to do the right thing. Start now! Help is available to give your financial story a happy ending too. Take the first step today.

 Photo credits: Cesar Martins, BK

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