Posted: 5-9-24 | Tom Pantlind, CFP®, SE- AWMA™, CRPC®
The Engaged Entrepreneur: Financial Planning for Today’s Professional Athlete
In the world of professional sports, the narrative of athletes squandering their fortunes is all too familiar. Tales of million-dollar contracts quickly evaporating have long dominated headlines. However, a new story has been emerging—one where athletes are taking control of their financial futures as seasoned entrepreneurs.
A Shift in Mindset
As many professional athletes are doing away with the days of reckless spending and naive financial decisions, they are beginning to view themselves not just as players, but as brands and businesses. With careers often ending in their prime, athletes are embracing the mindset of entrepreneurs, forging second careers while still in the spotlight. Philanthropic and forward-thinking, they are building teams of advisors who understand the complexities of wealth management in a way that was unheard of in previous generations.
No longer content with the mentality of “I just hit the lotto,” athletes are approaching their finances with responsibility. Agents and advisors are no longer just contract negotiators; they are mentors, guiding players through the nuances of mental health, financial planning, and beyond.
Athletes and Entrepreneurs
In many ways, the parallels between today’s athletes and successful entrepreneurs are striking. Both face sudden windfalls of cash, whether through a lucrative contract or a business sale. Both require comprehensive wealth planning that extends far beyond the present moment, encompassing tax planning, insurance planning, and generational planning.
Entrepreneurs and athletes alike require an advisor with specialized experience in private markets. These unique investment opportunities demand a keen eye for potential, a knack for identifying emerging trends, and the ability to guide clients towards sound financial decisions. Just as entrepreneurs rely on advisors to navigate their sophisticated balance sheets and seek out new avenues for growth, today’s professional athletes require the same level of expertise to manage their wealth effectively.
Financial Challenges for Professional Athletes
Despite the vast similarities to entrepreneurs, athletes face unique challenges that set them apart from traditional business owners. With careers lasting just a handful of years, they must plan for a future that could span decades beyond retirement. Career-ending injuries and high-spending habits add further complexity to an already intricate financial landscape.
According to the US Bureau of Labor Statistics, there are approximately 14,000 professional athletes in the United States. Most are between 20 and 30 years old, and careers typically last from 3.5 to 9.5 years. This means foundational planning needs to be done early on and not only account for career interruptions, but also make their savings last for another 50 years or more. Athletes must navigate the uncertainty of their careers, with the looming possibility of career-ending injuries posing a constant threat to their financial stability.
The Innovia Approach
At Innovia Wealth, we understand these challenges intimately. Our team of experts specializes in crafting tailored strategies for athletes, addressing the specific needs and uncertainties they face. From budgeting to complex investment decisions, Innovia works hand in hand with athletes and their trusted advisors to chart a course towards long-term financial success.
Our team is dedicated to efficiently examining opportunities, uncovering new prospects, and providing the personalized attention necessary to guide athletes and leverage private markets as a strategic tool for long-term financial success. Education and financial literacy are also paramount in Innovia’s approach. By empowering athletes with the knowledge and tools they need to make informed decisions, we help them build a foundation for lasting prosperity. Our focus on client-centered service ensures that no detail is overlooked.
Financial Success for Athletes
The athletes of today are more than just players—they are entrepreneurs, philanthropists, and leaders. At Innovia Wealth, we take pride in supporting them on their journey, helping to write a new chapter in the story of success both on and off the field. Together, we are navigating the financial playing field, rewriting the rules and creating a future where athletes thrive long after the final whistle blows.
To learn more about how we help professional athletes with their wealth management goals, contact us today.