Tip Content Provided By: Teig Stanley, CFP® at Financial Finesse
At Financial Finesse, I have had the honor of working with former NFL, NBA, and MLB players through the financial wellness benefits their leagues have established for them. As we work together, these guys have generously confided in me many things that they and their wives wish they’d known during their pro career. Most of us may never be professional athletes, but I’m pleasantly not surprised to note that what they’ve shared really does apply to all of us. Here’s a few things they’ve had to say:
- Having money in the bank right now doesn’t make you a successful businessman. I think that anyone who’s ever experienced an unexpected event like a job loss or major illness can relate to this — times may be good now, but they may not always stay that way. If you’re flush with money these days, lucky you! Enjoy, and use that money to secure your financial future as well — get at least 6 months expenses into your emergency fund, pay off any debt, and get some invested for retirement.
- I wish I’d started my business while I was playing, not after I left the league. We’ve had some debate about this on the planner team at Financial Finesse, but what I think he means is that before you lose your current stream of income (or give it up), make sure you’re set up to keep things going. Before you quit your 9-to-5 to pursue your dream of starting a business, start learning what your new adventure will entail by learning the vocabulary, shadowing someone else who’s doing it, and immersing in the hard work that goes with the glamour. Try to get a year’s worth of expenses set aside — that will give your business a solid year to get up and running, without you having to worry about turning a profit in order to pay your bills.
- Enough is never enough. You’ll never have a paycheck like the one you have right now. Don’t take it for granted! This one is pretty specific to pro athletes and highly paid entertainers, but it’s the truth! Save early and save often.
- I bought houses and some family lived in them. I didn’t start charging rent until two years after I’d left the league. You need to have that conversation and take that action before you leave the league. It just gets more awkward, and possibly disastrous, afterward. Lesson for the rest of us: if your income is helping to take care of others and your situation changes, don’t wait to give them a heads up that the change will affect them, too. We talk to so many people who are barely able to make ends meet due to a spouse’s disability or job loss, and yet they are still funding their adult children’s lifestyle. You have to change the agreement when your situation changes.
- I failed to run my life like a business while I was playing. I wish I’d done at 25 what I’m doing now. I wish I’d learned to run it like a business. You should always be looking at the numbers to make sure what’s coming in is enough to cover what’s going out, while also accumulating more to invest in the future. That’s the essence of running your life like a business.
- There will be awkward conversations, especially with your S.O. [significant other], no matter what happens when you leave the league. Be transparent. This is your time to shine, and she has her time to shine. The successful ones hash that out now. Your life partner can make or break you financially. Do the work to make sure you’re both playing for the same team.
- I spent 4 years NOT wanting to call Financial Finesse because I was convinced I could handle things on my own. I’m so glad I finally called. If I’d done it sooner, my life might have been better. There is no weakness in reaching out for help from the resources that are available to you. Whether that’s making use of a financial wellness benefit or calling your EAP for help with something else going on in life, it’s always a smart move.
- I should have been more aware of the benefits I would have AFTER I left the league, and more assertive about keeping them. I talked to a former player who missed out on hundreds of thousands of dollars of disability income simply because he moved and didn’t open his mail for two months! Many people I get to know across a variety of industries don’t know what benefits they have right now beyond a 401k and health insurance, and even fewer know that they could take some of those benefits with them when their job or career ends. Investing a little time right now in meeting with HR or researching your benefits internally may make a world of difference to you and your family, financially.
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