By Constantinos Massonos, Contributor
The special nature of an athletes’ career, highlights the importance of having solid written contracts for all aspects of their professional life; contracts that almost no athlete can deal with without receiving specialized advice. Consequently, building a team of trusted professional advisors around them, early in their career, can help athletes with setting and achieving financial goals, dealing with taxes, building and protecting their brand and maximizing their athletic career earnings, on and off the pitch, and sustaining their financial well-being after their playing days are over.
Many athletes will be successful in building such a circle of professionals who will guide and shield them from worst-case scenarios around them, but unfortunately many fail to plan for the worst-case scenario in their personal life, the failure of their marriage. The fact is divorce rates for athletes are even higher than the average divorce rate. If an athlete considers unromantic and uncomfortable talking about money and planning for the future with their other half before marriage, he or she might be left broke after a potential divorce.
Contacting an experienced family law attorney is the first step for writing up a prenuptial agreement, a legal contract between a couple, that becomes effective after they marry. The agreement, as any other contract, will generally define each party’s rights and responsibilities including the ownership and division of assets upon divorce. The main advantage of having a prenuptial contract in place is to avoid litigation, but such a contract can also include terms that keep the divorce and financial affairs of the couple away from the media.
The unpredictable nature of an athlete’s job, should be in the core of any prenuptial agreement. Key elements of such a prenuptial agreement should include the following:
Protection of an athlete’s current and future, on and off the field income, from the soon-to-be spouse in the case of divorce. As in any divorce, if a prenuptial agreement is not in place, anything earned or acquired after the marriage is considered marital property and can be divided between the couple including bank accounts, real estate and personal property. All the athlete’s potential future sources of income should be identified in co-operation with the rest of his or her advisors and their division should be defined in the prenuptial agreement.
Athletes’ income will usually decline over the years especially post-retirement, and if no careful planning takes place, athletes might end up struggling financially. The prenup can specify how spousal support and child care might be paid and to what amount, or it may state that spousal support is completely waived in the event of divorce. The prenuptial agreement is not only set up to protect the wealthier party, if there is one, but can also offer protection to the financially dependent part as well.
A non-disclosure agreement or confidentiality clause is a must in the social media era; It can help athletes avoid details of their personal and financial life being dumped to the media by preventing a spouse to release any information of this kind.
To conclude, a well written prenuptial agreement is an essential part of any athlete’s financial plan. Athletes, regardless of their current level of income, should consider putting a prenup in place when getting married, in order to protect the fruits of years of hard work. A prenuptial agreement that also respects the contribution of an athlete’s spouse to the marriage will help both the athlete and the spouse to focus on the important aspect of their marriage, which is loving and supporting each other.