The Wealth High Wire
Balancing High Stakes Decisions
Financial Planning for Professional Athletes: A Playbook for Long-Term Success
Signing a contract with a professional sports team is a monumental achievement. You’ve spent years training and perfecting your craft, and now you’re being rewarded with a lucrative deal. But while your agent may have handled the contract negotiations, managing your financial future is a whole different ballgame. Many athletes struggle financially after retirement, even after earning millions. Why? Because they didn’t have a solid financial plan.
Here are three key financial factors every professional athlete needs to consider:
1. Career Length: Maximize Your Peak Earning Years
On average, most athletes don’t play past the age of 30. Some may have shorter careers due to injury or changes in performance, and very few can sustain their careers into their late 30s or 40s. That means the window of peak earnings is relatively small compared to traditional careers. This makes it crucial to build wealth early.
During these peak earning years, it’s important to talk with your financial advisor about an investment and savings plan. You want to ensure that the wealth you accumulate now will continue to work for you long after your playing days are over. Diversify your investments, maximize savings, and avoid the temptation to live a high-spending lifestyle right away.
Think about where you want to be 10, 20, or 30 years from now. The decisions you make today will shape that future. By managing your finances prudently, you can create a legacy that extends beyond your sports career.
2. Retirement: Understand Your Benefits
Retirement for athletes happens much earlier than most traditional jobs, so understanding what benefits are available is critical. Many professional sports leagues offer pension plans or retirement benefits that are designed to support you after your playing career ends. Make sure you fully understand your league’s retirement benefits and any team matching programs—these can be just as valuable as your base salary.
For example, some leagues match a portion of what you contribute toward your retirement, effectively doubling your savings. Others may offer long-term pension plans that ensure you’re supported financially after you leave the game. Taking advantage of these opportunities early can provide significant financial security later in life.
It’s easy to focus on the now—new cars, homes, and experiences—but planning for your future self is equally as important. Leverage these retirement benefits to help create a sustainable financial future for you and your family.
3. Budgeting for Today: Manage Your Current Lifestyle
While it might seem like you’re earning plenty, remember that many athletes only get paid once a year or in seasonal installments. This can create a cash flow issue if you don’t budget properly. It’s easy to feel flush with cash when your big payday comes in, but those funds have to last for months—covering not just your lifestyle expenses but also taxes, agent fees, and long-term savings.
Without a proper budget, it’s easy to overspend and find yourself struggling to make ends meet before your next paycheck. Working with a financial advisor can help you establish a budget that ensures you cover all your expenses, stay on track with your financial goals, and avoid running through your money too quickly.
Being mindful of your spending today will help you build a foundation for tomorrow. You don’t want to find yourself in a position where your career ends, and you’re left with little to show for the wealth you earned.
As always, it’s wise to consult with your financial advisor to discuss your specific situation and make informed decisions tailored to your needs.
Seek Professional Help
If managing a windfall feels overwhelming, seek help from a professional. Argent Bridge Advisors provides tailored strategies, including tax planning, wealth management, and investment choices, to ensure your windfall serves you long-term. Avoid common mistakes, make informed decisions, and turn your sudden influx of money into lasting financial security.
Contact us at service@argentbridge.com to learn more about our services or to schedule a complimentary session today.
About Argent Bridge Advisors
Argent Bridge Advisors is a leading financial advisory firm dedicated to providing personalized strategies and solutions to help clients achieve their financial goals. With a team of experienced Private Wealth Advisor professionals and a commitment to client-centric service, Argent Bridge Advisors empowers individuals to navigate life’s financial challenges with confidence.
