Basketball star Chris Paul made headlines on Sunday when it was reported he re-signed to the Houston Rockets with a massive four-year $160 million deal (one even bigger than new Laker LeBron James' $154 million contract).
While Paul might be a self-made multimillionaire with plenty of money in the bank now, at one point, he was a refreshingly relatable college kid who was scared of credit cards and would split the bill at TGI Fridays.
In 2005, as a sophomore at Wake Forest University, Paul declared for the NBA draft, which meant he was leaving school to go to the big leagues. His agency offered him a $100,000 advance — but his parents insisted $25,000 would do just fine, he tells CNBC Make It. Still, the $25,000 check was a windfall for Paul.
"[T]hat was the day my life changed," Paul, 33, said.
The first thing he did was go shopping. "I took my girlfriend, my best friend, his girlfriend [and] we went to a mall and we went into a couple stores and I was like, 'Just get something,'" said Paul.
"[There's] no feeling like it," he explained. "Because we used to go on double dates to TGI Fridays, and when they would come with the bill, we'd be like 'Two bills, please,' you know me and my girl, him and his girl.
"That day, and ever since, it's been one bill."
Before he had money, Paul was cautious about spending. In college, like many young adults, he even had a tough time using credit cards.
"My mom called me and was like, 'Boy, you used that credit card yet?' and I was like, 'No, Ma,''' recounted Paul. "I just never liked the whole premise of having a credit card and being able to spend money that you don't have. I had my debit card, and so I just liked to spend money I knew I had. And that's when my mom told me that no credit is bad credit.
"I still don't like credit cards to this day," he said, explaining that while he has a credit card and uses it, it took some convincing from his financial advisor.
"I'm not cheap, but I'm frugal"
Paul, who is originally from North Carolina, has certainly come a long way from splitting the bill at Fridays. He was drafted by the New Orleans Hornets in 2005, and his salary for the 2005-2006 season was reported to be just over $3 million. In 2011, he was traded to the Los Angeles Clippers and, in June 2017, he went on to join the Houston Rockets in another high-profile trade. As his basketball prowess climbed, so did his income.
Forbes ranked Paul the ninth highest paid basketball player in 2017, reporting that he earned $22.9 million on the court and $8 million off.
Since adding some pretty big numbers to his bank account, Paul has made a few splurges that he now laughs about. He acknowledges past purchases like "iced-out chains" and an Escalade with 24-inch rims might not have been the most prudent. But he's not embarrassed and instead said, "You live and you learn."
Indeed, Paul said he's gained a lot of knowledge about managing money and the value of a dollar, calling finance, "an unbelievable learning experience." Now, he once again keeps a close eye on his spending habits and calls himself frugal.
"I'm not cheap but I'm frugal, so I'm very conscious of any and everything that I spend money on," Paul told CNBC Make It.
And despite his multimillionaire status, Paul teaches his two young children that if they want something, they have to work for it.
"He [Chris II] knows he has to work," Paul said. "He's on his iPad all the time, right? And he wants to go into the app and get the in-app purchases.... He knows good and well that's out unless he works or he has money that's in his wallet that's upstairs.
"I'm still learning," Paul added. "Trying to raise two kids who…they obviously get an opportunity to experience things that I never experienced as a kid, and the only thing me and my wife can do is make them understand the value of dollar and that they have to work for it."
Paul tries to show his son that hard work firsthand — for example he'll bring little Chris to the gym when he can or stretch with him at home the night before a game.
"I'm trying to show him that, you know mommy and daddy didn't just happen overnight," Paul said. "It takes a lot of hard work that goes into it and a lot of sacrifice."
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