Editorials

Athlete role models have a crucial role in the sports industry as well as in society in general, leading by example; being a source of inspiration to countless people all over the world. They are admired not only for their athletic skills but also for their character traits, personal values and ethical behavior. Through their great influence and power over crowds, they promote important social issues, making an impact that matters. As famous personas, they also have a major impact on fan engagement and consequently revenue generation for the sports industry, with sponsorship and endorsement deals. However, being an athlete role model does not come without challenges and pressure.

With successful professional athletes suddenly finding themselves making millions of dollars from one day to the next, it is only normal that their lifestyle changes. It is common for these athletes to be drawn to a more luxurious lifestyle, living for the moment. Moreover, their success may also lead to pressure from loved ones for financial support, causing them to question the intentions of the people close to them, whilst having a hard time setting boundaries. The extravagance of this new lifestyle and excessive spending habits can have disastrous financial effects, depleting this newfound wealth faster than the athlete may expect, if proper measures are not taken. Being able to enjoy fame and wealth responsibly, is key to maintaining a balanced and fulfilling life, as we will explore.

With a significant rise in female sports over the years, women have managed to defy all odds and thrive on what once seemed to be a male-dominated field. However, women still have to face a multitude of challenges in a wide range of fields in their everyday lives, due to the additional pressures and obstacles society and institutions heavily impose upon them. Female athletes have to juggle multiple roles, being athletes who need to succeed in their sport, being mothers who need to look after their children, being public personas who need to act as role-models, being wives and partners, as well as being financially healthy bread-winners.

A new year comes with new possibilities, opportunities as well as potential unexpected shortfalls. Therefore, athletes need to plan their finances ahead, organizing them proactively in order to stay on track with the goals and objectives they set for the new year and beyond. The only way athletes can reach their full potential is by turning these goals into reality. It all begins with identifying their current financial situation, as well as the financial position they would ideally want to be in, in order to come up with a structured plan on how to bridge this gap; fulfilling their financial goals and dreams in a way that adheres to their personal values. Organizing your finances can be simpler than you think, given that you have the discipline, dedication and flexibility required to follow through and be consistent.

Happy New Year to all of our Money Smart Athlete Blog readers. We will begin 2023 with an inspirational theme. When it comes to defining what it means for a person to be inspiring to you, there is no clear-cut answer. In the context of athletes, one can be considered inspirational due to their performance and athletic accomplishments; being able to set an athletic goal and do everything in their power to achieve it. Achieving their goals through hard work, perseverance, self-discipline and dedication, can truly empower those who follow and admire athletes.

How the general public, and especially fans and supporters, view and perceive a professional athlete as a sports personality but also as a public figure can undoubtedly affect not only their brand’s strength but also their mental wellbeing and consequently their sports performance. A positive public perception can elevate an athlete in all aspects, leading to an upward spiral, whilst a negative public perception can lead to a vicious cycle of failure, which can be very difficult yet not impossible to get out of. An athlete who acts recklessly in their athletic and personal life may end up putting their reputation on the line, risking losing everything they worked so hard for in a split second. However, with proper branding and marketing efforts perceptions can change to a certain extent, and an athlete’s positive public image can be recovered.

With professional athletes having a relatively short-lived career playing sports, relative to other professions, it is crucial for them to find ways to diversify their earnings streams outside of the playing field, during and after their sports career. A great way to do that is by taking advantage of the great influence they have on their fans and the general public; using their Name, Image and Likeness (NIL) to build and commercialize their brand image and therefore capitalize on it through sponsorships, endorsements and partnerships. This can be achieved through the creation of personal marketing strategies with well-defined branding activities, which are in line with the athlete’s personal values and what they want to represent.

When it comes to athletes and the challenges they face in their sports career, most people do not make the distinction between solo sports and team sports. However, the differences are significant, with solo-sport athletes facing a completely different set of obstacles relative to athletes in team sports, with loneliness being a great struggle. In individual sports, athletes only have themselves to rely on and when they fail to achieve their goals, the effect can be demoralizing; putting a strain on their emotional and mental health and well-being. This in turn can have a major impact on their personal life as a whole- not just on their sports performance.

In an ever-changing business environment, the conventional traditions of business are being redefined, with start-ups and entrepreneurs revolutionizing the economy. Elite athletes are no exception to this entrepreneurial transition. Notable sports names including David Beckham, Magic Johnson and Venus Williams have chosen to shift their focus to the world of business, with successful business careers as startup founders and innovators, safeguarding their financial stability after retirement from sports. There is no doubt that throughout their sports career, athletes cultivate various transferable skills and traits which could be applied to the business world, allowing them to become successful entrepreneurs.

Student-athletes are predominantly an American concept. Becoming a professional athlete through college sports is considered the conventional and “right” way. Talented high school seniors are scouted and courted by colleges. They then have to prove that they are pro material in order to be offered a professional contract; at least some of them. In fact, fewer than 2% of them end up turning pro. Nonetheless, student-athletes are considered some of the most privileged people on campus. In some aspects they are. They become recognizable, popular and people line up to watch them compete. But how “privileged” are they, really?

Athletes are in a mostly lucrative, albeit peculiar profession. Many receive astronomical salaries to compete, and make more in a year than the average person in their entire working life. Nonetheless, with retirement coming at a rather young age there is an abrupt...

Regarded as a taboo until recently, discussions on mental health have certainly become mainstream in the past few years. Several high-profile athletes have opened up about their struggles including the much-debated Osaka saga. It’s hard to persuade people that athletes with their celebrity status and millions of dollars deserve sympathy, but the reality is that neither talent nor money guarantee mental stability.

Financial literacy lies at the core of our mission here at the Sports Financial Literacy Academy. We define financial literacy as the ability to understand basic financial concepts and utilize a plethora of financial tools and skills in order to make informed and effective choices. Years ago, the Money Smart Athlete Blog was created when we identified a critical shortcoming of sportspersons around the globe; the ability to make prudent financial decisions and ensure their long-term financial well-being. We are glad to see that in recent years, more and more people are starting to appreciate the importance of financial literacy, both in the context of sports and outside of it.

The developments in female sports are rapid and incessant. Although, gender inequality in salaries, investment, TV rights and even participation still exists, no one can doubt that the gap is briskly closing. Just last week, the US Women Soccer team won $24mn payout and guarantees regarding the future of the industry after a six-year legal battle over equal pay. In the spirt of women’s day which is in a week from now, we have decided to dedicate March to female sports.

It is highly unlikely that you haven’t heard of cryptocurrencies, crypto-assets, crypto-funds, or whatever other name is used to describe these electronic currencies. It all started with Bitcoin and its mysterious founder Satoshi Nakamoto. Despite the negative publicity surrounding the crypto world with its perceived relationship to criminal activity, money laundering and terrorist financing, it has gained ground with regular people and mainstream investors. Its decentralized nature has drawn millions of people from all over the world and it has made millionaires and billionaires overnight. It has also recently gained the attention of central bankers and politicians, such as Hilary Clinton and regulatory debates regarding the crypto space have already begun.

We will begin this year by discussing the importance of laying the right foundations, a particularly tough challenge for parents of young athletes. Our themes for this month will be early financial literacy, gratitude, social responsibility and peer pressure.  Our formative years are of the utmost importance since that is when we are equipped with the tools and knowledge to go out in the world. Children are like blank slates and the younger they are taught something the better they will understand it as they grow, which is why is important to educate your child financially at a young age.  

Betting or gambling is one of the oldest social activities of civilization. Gambling preceded history and record-keeping. The betting industry has been growing for decades. It was assisted by the digital revolution which rendered betting as easy as writing a text message and it was further boosted by the legislative changes in the US three years ago. Several market researchers believe that the market will experience meteoric rise over the next few years, with the size of the industry rising well over $100bn.

Athletes are encouraged to plan for their future early on. The short duration of sport careers in combination with the high earnings, deems early and efficient financial planning a necessity for athletes. A huge part of that is saving and then investing those savings in places that would hopefully guarantee athletes a healthy cash flow in their lives post-retirement.