By Vasilia Polycarpou, The Sports Financial Literacy Academy
With great success come great financial opportunities, but also additional pressure and responsibilities. Professional athletes may suddenly find themselves earning excessively large sums of money, which they may have a hard time having control over. It is quite easy for sudden wealth to cloud one’s financial decision-making and judgement. This is especially true for a lot of athletes with humble financial backgrounds, who eventually meet success and want to treat themselves, as well as the people close to them. This newfound wealth can be a great opportunity to create a better life for themselves and their family or a trap, leading to financial distress, if it is not managed properly.
It is common for athletes to feel the need to financially help and support those who have contributed to their athletic success, especially since their family, friends and loved ones have probably made a lot of personal sacrifices to be there for them throughout their journey. However, there need to be boundaries in place to avoid misunderstandings and overspending. Athletes can be generous and show their appreciation to friends and family for their efforts, however, they also need to be able to say no if they feel that things are getting out of hand, keeping in mind that athletic careers are usually short-lived and earnings are quite volatile. Athletes may feel overwhelmed to give in to the pressure of friends and family asking for financial help, therefore they should have professional support, such as an advisor, life-coach and/or therapist to guide them in handling these types of pressures in a rational, yet diplomatic way.
Furthermore, the sudden wealth syndrome may lead athletes to fear of being exploited or hurt by others, who may view them as an opportunity to gain money. This can consequently lead to suspicion or even loss of trust in others, which can cause anxiety, stress and be psychologically damaging. A great example, is that of former NFL player Phillip Buchanon which can be seen as a cautionary tale. According to Buchanon, after he was drafted, his mother demanded a million dollars for raising him, putting a strain on their relationship.
Moreover, the example of American football running back Trent Richardson is also worth mentioning. Richardson lost millions due to family members and close friends taking advantage of his wealth. According to reports, the people he trusted most, spent nearly $1.6 million of his money within ten months in 2015, leading him to feeling betrayed, losing the trust he had in them, and ultimately choosing to cut ties with most of his relatives.
All in all, athletes should be very careful with how they allow money to affect their intimate connections and relationships. Money may be a factor testing the depth and strength of their relationships. Keeping a tight inner circle of people with whom they have created real relationships, which are not defined by their athletic and financial success is key, in addition to having boundaries in place and being able to say no, even if that means not always pleasing others, but putting their own financial interests first.
The Money Smart Athlete® Blog is established and run by the Sports Financial Literacy Academy® (SFLA). Through its education programs, the SFLA has the vision to financially educate and empower athletes of all ages to become better people, not just better athletes. For more information on our courses, our SFLA Approved Trainer Program®, and how they can benefit you and your clients, please get in touch with us at firstname.lastname@example.org.