It is a dream come true to play a sport on the professional level. Obtaining this accomplishment can help you become financially free. Unfortunately, there are negatives that come along with the success. You can become a target because people want to get their hands on your money. Read on to find out how financial planning for professional athletes helps you to prepare for retirement.
Talk To A Financial Planner
A relationship with a financial advisor is ongoing. It helps to choose an experienced advisor with a large clientele. It should also be someone that you can trust. A financial session involves looking at forward scenarios. These scenarios include looking at your earnings, contract years, purchases of homes and vehicles, family support needs and tax bracket. Evaluating this information allows you and your advisor to make educated decisions about your future.
The foundation of your financial plan starts with your priorities and goals. If you do not have a plan, then you may choose investments that are only favorable for short term. Short-term investments move you further away from your most important goals. Your financial plan serves as a guiding map to help with making smart investments.
Pay Cash For Real Estate
People are always saying that real estate is a good investment. Some athletes make the mistake of buying homes in their favorite city. For example, it would not be a good idea to buy a beach condo in Miami if you only come to visit one time a year. Paying for lodging would be cheaper than maintaining a house.
If you cannot afford to pay cash for the real estate, then you should not purchase it. Paying cash means you are just responsible for the utilities and home insurance.
Avoid Unnecessary Expenses
Athletes are often told they need to live a certain lifestyle. For example, you need to utilize a private jet or hire a chef. You should try to use commercial airlines as much as possible. If you need to be somewhere in a hurry, then you can charter a private jet. A chef is a luxury and it is much cheaper to go to a restaurants. You have to evaluate whether some of your expenses are a necessity instead of a want.
The earning capacity and career tends to be brief for an athlete. If you want to make plans for retirement, then it helps to talk to a financial planner.