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How a Hockey 'Bad Boy' Helps Athletes Invest

Hockey Great Sanderson's Financial Advice For Athletes

Hockey legend Derek Sanderson knows what it's like to be on top of the world, only to lose it all in a spectacular haze of fame, fortune and addiction.

So when he finally turned his life around, it's not surprising that he wanted to help other athletes avoid the temptations of living the high life at the expense of their financial futures.

"It's very difficult to get someone 21, 22 or 23 years old to save money when they're making $7 [or] $8 million a year," Sanderson told "Squawk Box" on CNBC. "That seems foolish."

The tough center on the ice known as "The Turk" was once the highest paid athlete in the world. He led the Boston Bruins to two Stanley Cup championships in the early 1970s. He was one of the first rebels of his sport, wearing his hair long and growing a moustache before it was the thing to do.

Known at the time as the "Joe Namath of hockey," Sanderson had it all.

But it didn't last.

"[The money] tends to get into the way of your social life," the now 66 year old Sanderson reflected. "It takes the spirit away from the game that you love and play."

A lavish lifestyle and a series of poor investments eventually left him broke. And with an addiction to alcohol and drugs to pay for, he ended up on the streets.

By 1980, he started to turn his life around again — a journey he describes in his new book "Crossing the Line: The Outrageous Story of a Hockey Original."

Sanderson is now managing director of The Sports Group, which is a division of Boston-based Baystate Wealth Management. The goal of the venture is to educate athletes about money and manage all aspects of their financial lives — from creating a budget to establishing a savings plan to building an investment strategy. That often times includes advice on how to psychologically deal with their sudden wealth. "It's a difficult thing to handle and there's a lot of counseling involved."

Today's culture of sports stars driving cars that cost as much as some houses, wearing thousands of dollars of clothes and jewelry, and owning multiple mansions is hard for young athletes, said Sanderson. "It's very difficult for a player to control, when they're young and they see the older guys doing foolish things."

But he warned that athletes — and investors in general — shouldn't run too far in the other direction and put their investments on auto-pilot with even the most trusted money-managers. "That's something you don't want to do. Give someone else your money to play with, while you're not watching it."

Sanderson lived the nightmare of losing his fortune, and stressed the importance of having a nest-egg for retirement and a rainy-day fund.

Athletes' careers are short, and in some cases interrupted injury, trades, and work stoppages like the NHL lockout.

Needless to say, Sanderson wasn't short on opinions when it came to assigning blame for why National Hockey League players were not on the ice.

"I thought the last [collective bargaining agreement] was very good for everybody … I thought the owners would be thrilled," he said.

The one thing Sanderson wanted hockey fans to understand: "This is not the players striking." It's the owners locking them out.

"The players are getting beat up here … I just want to see them playing again," he said.

By CNBC's Matthew J. Belvedere; Follow him on Twitter @Matt_SquawkCNBC