Shaq once blew through $1 million in under an hour, but now he saves 75% of his income

Former basketball player Shaquille O'Neal
NBC | NBCUniversal | Getty Images

Within an hour of signing his first professional basketball contract in 1992, Shaquille O'Neal blew through $1 million.

The former NBA star, who was 20 at the time, bought a $150,000 Mercedes Benz for himself and one for his dad. He also bought a car for his mom and paid off her house.

When it comes to managing money, O'Neal is the first to admit that he's "done a lot of things wrong," he told CNBC's Bob Pisani in 2018. But today, the retired athlete has made a name for himself as a successful businessman, growing his fortune through various investments and business ventures.

He was an early investor in Google and Apple and, today owns 17 Auntie Anne's, a Krispy Kreme franchise and a handful of restaurants, gyms and car washes.

Thanks to advice he once got from a mentor, O'Neal saves the majority of what he makes, he said in an interview with The Wall Street Journal: "I met a gentleman one time. He had a piece of paper. He said, 'This is $100.'" The man proceeded to rip the paper in half and then told O'Neal: "Smart people invest this $50 and then they have $50 left."

"But the wealthy people take half of that $50 … [and] put that away," he added. "So I started doing that," O'Neal said.

In short, O'Neal saves and invests 75% of his income and lives off the remaining 25%. He also uses whatever is left over to "have fun with," he told the WSJ. "Cars, jewelry, whatever you want."

He recommends any young person coming into a lot of money do the same: "I'd tell them that this money isn't going to last forever. You've got to save it, you've got to invest it and you've got to be smart."

Don't miss: Shaq: As soon as I started investing like Jeff Bezos, 'I probably quadrupled what I'm worth'

Like this story? Subscribe to CNBC Make It on YouTube!

Shaquille O'Neal's money advice to young people
Shaquille O'Neal's money advice to young people