Though some athletes have careers that span decades, the average
athletic career is just 4-6 years in many sports. This brief career window,
combined with the high level of competition, uncertainty and potential for
injury makes it particularly important for professional athletes to plan for
their financial futures. If you are a professional athlete, consider these
three tips when planning your financial strategy.
Hire a Financial Planner
Because the financial challenges faced by athletes are unique,
it can be important to hire a professional with expertise in financial planning for professional
athletes.
A professional financial planner can advise you on how to manage your wealth in
such a way that it will last you for as many years as you need for it to after
retirement.
Minimize Taxes
Because most athletes have such a short earning window, it is
particularly vital to keep as much of the money that they earn as possible. A
CPA can assist you with planning tax strategies, such as choosing to
reside in a tax-friendly state. She can also help you navigate the tax impacts
of your endorsements, signing bonuses and other contract issues.
Avoid Overspending
Many athletes are tempted to rush out to buy fancy cars, big
houses and other luxuries when they sign their first big contract. It is
important to remember that the money you are earning over the next few years
may need to last you for a lifetime. If you spend too much of it on luxury
items, you may find yourself having to accept work you would rather not in your
post-playing days, instead of enjoying a comfortable lifestyle and doing only
the work you want to do.
Professional athletes face unique challenges when it comes to
managing their wealth. These three tips can help you create a financial
strategy that will allow you to enjoy a comfortable lifestyle now, while also
preparing for your future financial needs.
