Yesterday my family and I got in the car and drove to Arizona for the day to see my beloved Los Angeles Dodgers play a Cactus League game against the Chicago White Sox at their new spring training complex known as Camelback Ranch.
The Dodgers lost 6-1 and, I gotta tell you, if the Dodgers don’t find some pitching help real soon it’s going to be a very long season. We all had a great time anyway. In fact, we vowed to make the trip again next year — whether the Dodgers find decent pitching or not.
While watching Dodger superstar Manny Ramirez (who went 2 for 3), I started to think about how much money this guy makes and what it must feel like from a financial perspective to be in his shoes; Manny is earning $25 million this year. Talk about being blessed!
According to the New York Times, in 2006 the average joe was paid a wage of only $46,996. That’s 1/532 the income of Manny Ramirez. Taking that data into account, and ignoring the effects of inflation, here’s what most people would experience if their modest wages gave them buying-power equivalent to Manny Ramirez:
The average home in the United States could be purchased for $413, based upon a median price of $220,000.
Of course, those that felt like “moving on up” could buy a $2 million beachfront home in Malibu for $3,760…
… or Don Imus’s mansion in Westport, CT, for $56,391, based upon his asking price of $30 million. (Good luck on that one, Don.)
A fully-loaded BMW 7-series sedan would cost $158, based upon the manufacturer’s list price of $84,200.
Then again, for the practical types, a Honda Civic would run only $29, based upon an MSRP of just over $15,505.
$79 would buy Dodgers season tickets with four of the best seats in the house, based upon an advertised price of $42,140.
A top-of-the-line iMac computer would cost $4.
An iPod Classic could be had for 46 cents…
…the more frugal types could buy an iPod Shuffle for only 15 cents instead.
Folks could drive their Hummers or other gas-guzzlers to their heart’s content because even a $50 fill-up at the gas station would only cost about 9 cents.
Meanwhile, the hungry could buy 5 items from their favorite restaurant’s one-dollar value menu for a single penny — and even have a little change coming back!
Depending on your actual wages, these numbers will vary slightly, but I think you get the idea.
Hopefully, this little exercise allowed you to escape for a minute or two and envision just how well-off many of these superstar athletes have it — and how out-of-touch most of them have become as to what it is really like to live with the rest of us here in the real world.
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How about the after-tax equivalent? In California, all income over $1M is taxed at 10.3%, and the federal tax rate for a sports star is higher than the average Joe too. I don’t think it would make a huge difference, but it might bump those costs up by 25% or so.
@BD: Good points. Although I am too lazy to run the numbers, as you stated the after-tax equivalent wouldn’t make a significant difference. I equate the tax impacts on the rich as being similar to a gnat on the behind of an elephant. Maybe it’s slightly annoying for the elephant, but in the end no real impact. 🙂
Great information.. People can really see what things are costing these millionaires compared to the average person.. Keep it up RICH :0)
This is some good information, I just finished my paper for class and think i may need to bookmark or save this for the second class lol. You may have just made me a regular 🙂
I recently discovered your site and have really enjoyed the content and the responses. I am a financial moron. I started a courier company in 1979 and from the time I was 27 to age 57 my annual income varied between 150K and $300K. I had about 50 drivers and 6 office staff. I haven’t saved a penny, so when the economy tanked in ’08 and electronic transmission of documents came around I had to lay off almost all of my office staff and now have only about 20 drivers. I always thought that the money would keep on rolling in. Sooooo, here I am at 61 working 12 hour days with no savings and no retirement money. I consider myself to be a smart person, but I was really dumb when it came to planning a way to retire. Thought you might want to post this as a lesson in how NOT to be financially responsible.
Bob C
Those guys usually end up broke, however. They don’t invest their money and it leads to spending all of their millions with nothing to show for it. You need to know how to manage as insurance you’ll have it for the rest of your life.