By Vasilia Polycarpou, The Sports Financial Literacy Academy
When we think about the lives of professional athletes, fame, success, extravagant lifestyles and glorious athletic achievements come to mind. Little attention is paid to personal growth and development, skill-enhancement and financial stability beyond their sports years. To lead a meaningful and financially sustainable life, an athlete needs to invest time and effort to build the necessary foundations.
It is common for athletes who suddenly come into great wealth to give in to the temptations that come with it, engaging in excessive, luxurious spending, without taking measures to preserve it for the future in any way. Such a mentality could lead to bankruptcy at the blink of an eye. A widely-known example is that of soccer star Diego Maradona, whose personal struggles with addiction and poor financial decisions took over his life, resulting in serious debt.
The solution to this issue lies in personal development, which begins with education and financial literacy. Developing financial management skills, by understanding the principles of budgeting, investing and taxation, is vital for the long-term financial stability of athletes, who will be equipped with the tools to make informed financial decisions. For example, former baseball player, Alex Rodriguez, who has built great wealth through his investments and business deals beyond sports, completed a certificate program in Business Management and Entrepreneurship from Harvard University.
Another way of ensuring financial stability, is by building a diversified investment portfolio, to spread the risk. Given the relatively small earnings window of athletes, and their income volatility, they need to make the most out of their earnings by making wise investment choices which will provide them with passive income. Seeking professional advice from trustworthy advisors can help athletes achieve that, whilst they will also have the opportunity to ask questions and utilize their guidance to build on their financial skills and grow. According to basketball legend Michael Jordan, his long-time trusted financial advisor, Estee Portnoy, has helped him build his own business empire, with endorsements, investments, and ownership stakes in sports franchises.
Personal growth also comes in the form of soft-skills development; a great example being communication skills. By working on enhancing their communication skills, athletes can carefully manage their image, forming stronger connections with their fans through the wide range of media platforms available to them. This in turn can help them leverage their personal brand and networks to create additional income streams through endorsements and sponsorships. Iconic former tennis player and female empowerment figure Serena Williams, is a prime example of this. She has managed to create an influential personal brand, being an ambassador for major brands and using her platform to advocate for social causes and communicate with her fans.
Furthermore, athletes could also focus on developing their leadership, entrepreneurial skills or any other talent they may have, in order to take advantage of employment opportunities for a potentially successful post-sports career, which can guarantee their long-term financial stability. Exploring their passions and talents beyond playing sports can open up a whole new world of fulfilling opportunities. For example, sprint king Usain Bolt, was not afraid to explore his passion for music, releasing his own reggae tracks, DJing and making music. Another great example is that of former NFL quarterback Peyton Manning, who managed to become an influential figure in sports broadcasting, as a successful sports commentator and analyst, taking advantage of his communication skills as well as his love and knowledge of sports.
We can conclude, that personal development is all about growing as an individual in a holistic, well-rounded manner that goes beyond sports and physical abilities. Having a growth mindset and seeking continuous learning opportunities across different areas and aspects of life, from finance to soft skills development, can help athletes build the right foundations for their long-term financial stability.
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 [email protected].