The 4 Goals Of Wealth Management For Professional Athletes

When you play professional sports, you know that the income potential can be tremendous — but it can also be hard to forecast. This makes wealth management plans vital for anyone expecting to enter or already in the pro sports world. These four goals should be your main drive as you work with a financial planner to make the most of your contracts. 

1. Income Balance

Probably the most challenging financial quandary for athletes is that income can fluctuate wildly over the years. Many players get large contracts for a limited time and then rely on sources of income that vary and aren't guaranteed. A wealth management plan attempts to balance out these fluctuations by creating your own stable 'paycheck' from these outside sources and make your money earn its own income. 

2. Expense Control

Another difficulty for most athletes — especially new ones — is to manage their expenses. The role comes with a variety of new expenses which can add up quickly — everything from travel expenses to networking costs to hiring managers and lawyers. In addition, many sports pros don't have a lot of experience managing their own expenses or working with a budget. Getting help with budgeting makes it more successful.  

3. Tax Minimizing

Everyone earning money must deal with taxes, and this is only compounded when your income shoots up unexpectedly. The more your income grows, the more your tax rate does as well. There are ways to legitimately reduce your tax burden, including using tax-advantaged accounts, timing income and expenses, and investing in advantageous ways. But most people don't know the tax code well enough to do this on their own. 

4. Asset Protection

Finally, you want to protect your wealth and help it grow. Asset protection includes many different elements. It includes buying the right insurance to protect your finances, investing in a well-balanced portfolio that holds both stable and riskier investments, deciding about new business opportunities, and using legal vehicles like trusts to protect assets. It also includes avoiding unlawful or dangerous schemes. 

While these goals sound simple and straightforward, they require a lot of attention to get right. Many players get them wrong, serving as a cautionary tale. Your best path toward financial success is to work with a qualified wealth management service with experience serving athletes like you. Then you can pursue your sports dreams knowing that your future is in good hands. Learn more about wealth management planning services today.