The current Celtic boss said that he was keen to keep the England international's earnings at a minimum while he was young because he believes wealth often "distorts reality".
"There is one common denominator when it comes to young players falling by the wayside - money," Rodgers told The Express. "It distorts reality, it changes people. I'm always cautious of that.
"I had Raheem Sterling playing for England and a regular in the Liverpool first team on £2,000 per week.
"I couldn't do it any longer than about the November time because he was absolutely brilliant, so we had to get him on a different contract. But I stretched it out as long as I could."
Sterling left Liverpool to join Manchester City in the summer of 2015.