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When Shaquille O'Neal spent $9M of his $10.5M salary in one day

Florida has no state income tax. Things are a bit different in California, and Shaq learned that the hard way.
Shaquille O'Neal sits on the Laker bench

Shaquille O'Neal

When NBA legend Shaquille O'Neal first secured his paycheck as a Los Angeles Laker, he made approximately $20M a year. And like almost every employee in the world, Shaq wanted to treat himself for his hard work after he received his first paycheck. So, O'Neal splurged on what he wanted, but here's the catch: the big man totally forgot about the 50% tax deduction that came with his move from Orlando to Los Angeles.

Three new cars and a massive chunk of money gone

Before O'Neal realized that his $20M would be deducted by 50% due to Los Angeles' tax requirement, he had already spent it on 3 new luxurious cars. Unfortunately, it was only later that O'Neal realized (through his agent) that he overspent and only received $10.5M on his paycheck. He couldn't request a refund, so Shaq went home with 3 brand new Rolls Royce and $1.5M left to spare.

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"So now when I first get to LA, listen 120 through 7 [years]. What's that, what I made what $20 [million] a year something like that. So I get to LA now, I gotta floss Gary. I'm going over, and I'm looking at matches in the hills. How much is this for me? Cash. How much is that Rolls Royce? $300,000? We get three of them, another million. Just straight cash," O'Neal said in his appearance at the Gary Vee's podcast. "So when I saw my cheque with $10.9 million and I had spent $9 million. Boy, was I upset with myself. I really was," O'Neal added.

The importance of an agent

In the middle of his shopping trip, O'Neal mentioned that his agent Perry Rogers called him right away to say that he had overspent. If it weren't for Rogers, O'Neal would've probably gone home with no money in his wallet instead of the $1.5M he had left. This is another example of why agents matter to high-profile players like O'Neal. Not only do they serve as their representatives to their corresponding teams, but player-agents sort of act like financial advisers as well.

Going back to O'Neal, at least his first shopping spree in Los Angeles served as a lesson for him. The big Diesel eventually learned how to save his money and invest in the future. That's why he's currently thriving in post-retirement.

O'Neal is one of the handfuls of NBA players who continue to grind for their money (by investing and putting up their businesses) years after their NBA career. Suffice it to say that given how wealthy O'Neal is now, he made up for his careless mistake in his early years in Los Angeles. 

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