By Aris Costeas, The Sports Financial Literacy Academy
One could argue that money is not everything; it cannot be denied that its significance lies in enabling a comfortable life. To live a comfortable life means that you reach financial freedom through financial goal setting. Athletes must think long-term when setting their financial goals, as a sports career may be successful but for most athletes it may only last for a few years. From that point onwards they have to live off the savings set aside while being active in sports. These savings are most definitely the results of the financial goals they had set during their athletic years and the earlier they had started, the better off they are.
Optimal financial planning serves as the cornerstone for the financial independence of athletes, who should take into account various parameters and adopt a conservative approach when it comes to spending but be very large when it comes to the amounts that they put aside as savings. The fleeting and unpredictable nature of athletic careers, often terminated by serious injuries, accentuates the importance of financial preparedness. Numerous renowned athletes have experienced premature and unexpected conclusions in their careers, finding themselves financially unprepared. This lack of readiness forces them to abandon the luxuries and comforts that characterized their time in the sporting limelight.
Therefore, it is vital for athletes to be smart about their financial goal setting by taking into account the aforementioned financial preparedness. It is crucial not to get carried away by the abundance of income which keeps flowing in during their athletic years. It’s not about discouraging athletes from enjoying a lavish lifestyle during their career; instead, the suggestion here is to handle money judiciously and put aside money into savings before spending. Being smart about financial goal setting means to make sure that there are foundations for different income streams past the athletic career that can allow athletes to sustain the lifestyle they want to maintain throughout post-retirement.
There are various ways that athletes can make this possible, especially if they are high earning athletes or have a great reputation. A short list of some of these ways includes: making smart investments in stocks, bonds, real estate, etc., creating income streams from branding by using their reputable name as an athlete, and/or through entrepreneurship by starting their own business. Undoubtedly, making successful investments, building a prosperous brand, or becoming an entrepreneur and innovator is not an easy task. Making the process easier, involves acquiring knowledge about it and enlisting the support of the right advisors and resources.
To learn more about how to be smart about investing and how developing your own brand, business, or innovation, can help you create additional revenue streams after your sporting days are over, you can take a look at a plethora of previous blog posts which offer guidance on how athletes can achieve financial independence during and beyond their sporting days.
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].