Babe Ruth: The Sultan of Safe Money

George Herman Ruth had a lot of bad financial habits. He spent too much, he spent frivolously and he fumbled away his earnings power to some degree.

But the Babe was shrewd in one important aspect: The annuities he bought protected him for life. That purchase proved to be one of the best decisions Ruth ever made, once the Great Depression wiped out savings and earnings power across the country.

The annuities Ruth purchased from a competing ballplayer early in his career guaranteed him an annual income for life of about $300,000 in today’s dollars.

Many consider the Babe the best player in baseball history, and he took his last swing more than 80 years ago. The 6-foot-2, 215-pound Ruth (who frequently played much heavier) swatted 714 home runs. At his 1935 retirement, the next closest player had 378.

Babe so dominated the game that he spawned the adjective “Ruthian” to describe mind-defying feats.

Off the field, Ruth lived just as large. He crashed cars, charged into the stands to fight hecklers, was subjected to paternity suits and suspended by the commissioner for leading an off season barnstorming team.

According to newspaper reports from the time, Ruth bought his first annuity in 1923 from Harry Heilmann, a star outfielder for the Detroit Tigers who sold insurance on the side. Ruth would ultimately fare better than his colleague. Heilmann’s insurance business went belly-up during the early years of the Depression.

“I may take risks in life, but I will never risk my money,” Ruth is alleged to have said.

Ruth’s business manager, Christy Walsh, became concerned that his client was spending money just as quickly as he made it. So Walsh set Ruth up with Heilmann, who sold the Babe a deferred annuity through Equitable Life Insurance Company (now AXA Equitable).

Ruth continued to buy annuities through the end of the decade. Walsh set it up so the Babe could withdraw the money as income when his career wound down. By the time of the first withdrawal in 1934, the country was deep in economic despair.

But the Ruths were not. News reports peg the Babe’s annual annuity payments at $17,500, or more than $290,000 in today’s dollars.

The retirement years were difficult for Ruth, as biographers have noted. He never found a second career, and longed for a managerial offer that never came. Babe lived out his life fishing, golfing and bowling his days away.

Money is one worry he didn’t have. Thanks to a shrewd investment in annuities, Ruth provided well for his wife Claire and daughters Dorothy and Julia.

Ruth was so impressed with his annuities that before he died of cancer in 1948, he made arrangements for an annuity to give Claire a source of guaranteed income for the remainder of her life.

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