Jonah Lomu died effectively broke last month, it has been revealed, as friends establish a trust fund for the rugby player’s two sons.

New Zealand Rugby Players Association has launched the Jonah Lomu Legacy Trust to provide for the All Blacks star's sons – Dhyreille, six, and Brayley, five – following Lomu's sudden death aged 40 last month.

The association’s chief executive, Rob Nichol, said it was formed after close friends realised the family’s financial situation, and its own advisers had dealt with those helping the family. “While the probate of the estate will take some time, we know enough to realise that the family will not be able to rely on any financial proceeds or ongoing financial benefit,” he said.

“It is also apparent that his 20-year illness and long dialysis sessions, multiple times a week, affected him far more than people realised, including his ability to work and earn the type of money people probably assumed he was capable of earning.”

The trust, not set up at the request of the family, will solely benefit Lomu’s two boys, providing the education and pastoral care he would have wanted for them.

The association is urging the public to get behind the cause and donate to the trust. The former All Black Michael Jones, one of four trustees, said it was time to give back to Lomu, who did a lot to promote the All Blacks brand to the world.

“He superseded anything we had seen before, and it is unlikely we will ever see the likes of again,” Jones said. “He was an absolute rugby phenomenon.”

Friends paying tribute to Lomu after his death said he had always been generous with his money. “When Lomu came back to Mangere [the community in Auckland where Lomu grew up], he sometimes used to pay my bills for me, he was like that,” Tasha Tasmania, a childhood friend of Lomu’s and chairwoman of the Mangere East Hawks rugby league club, told the Guardian shortly after his death.

“He gave a lot to our area. Back in the day, it was a rough area and a rough time and Jonah spent a lot of time giving back. Growing up, this area was so saturated with gangs and crime, but Jonah managed to escape that.

“So the younger brothers growing up now, they look up to Jonah, and he tries to teach them there are other options in life than crime and violence.”

Nichol said he believed the financial situation had arisen because of Lomu’s generosity and wanting to keep up the appearance of wealth. Lomu’s home, in the exclusive Auckland suburb of Epsom, where he died last month, was worth $2.2m (£1.45m), but it was a rental, the New Zealand Herald reported.

“He has definitely taken on obligations of others – whether it’s family or others close to him, whether it’s financial or other kinds of obligations – at the expense of himself, Nadene and the boys,” he said. “People probably assumed he was still on a pretty good wicket and able to do a lot of work and earn a lot of money ... He obviously felt he had to keep living that.”

One of Lomu’s former New Zealand teammates said it was a myth that professional rugby players were multimillionaires during their era, even those who rose to the dizzy heights of Lomu’s fame.

The former All Black Josh Kronfeld, Lomu’s roommate during the South Africa World Cup, told the New Zealand Herald he believed commentators were vastly overestimating what his friend’s wealth had ever been.

"People read what Richie McCaw and Dan Carter [more recent New Zealand players] make playing for the All Blacks and assume those figures are what Jonah was on from the mid-1990s on, but that's just not right," he said.

“That sort of money wasn’t around for any players in our era, including Jonah. He made good money from playing at the time, but not what people assumed it to be. It was never millions of dollars.”

Kronfeld said Lomu’s career was shorter than most players, due to illness, and had more restrictions placed on him in relation to sponsorship deals than players are subject to now. “I’m sure Jonah could have done a lot more endorsement work and earned more money without those restrictions,” he said.

“When you consider how long he’s had to have health treatment since retiring and the drain of that on both his time to do other things and his finances, it must have been very difficult for him. It’s a very sad situation for all involved.”

The appeal has not been without its critics. Hilary Barry, a prominent Kiwi broadcaster, said on social media that Lomu’s financial problems should have been kept private.

“Why could the NZRFU and Players Association not have had a whip around behind closed doors?” Barry wrote. “It concerns me that the memory of this great and gentle giant will be tarnished by the negativity this initiative will generate.”

(Guardian service)