How Star Athletes Deal With Retirement: Financial Lessons
Restored from the Empower Network archive (2011–2017), lightly edited to meet our current advertising standards. Views are the original author’s.
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Hi There, Friends of Freedom:
As is my custom, I was sitting with my morning beverage today
looking through the investment and investor news
getting a handle on what the media might be talking about
that would spook my clients and de-rail them from the plans
we have put together to ensure that:
1. The family is properly protected in the event that they would “die too soon”
2. They are moving out of the debt cycle in order to achieve freedom from debt, and
3. They are on the road to financial independence, to never have to worry about “living too long”
This article caught my eye and I felt an imperative to share it.
How Star Athletes Deal With Retirement: Financial Lessons
To quote pro golfer Annika Sorenstam, “I didn’t grow up really rich or especially poor but I was taught to respect money.” She remembers her economic status as a child, noting, “Yes, I had to share my first set up golf clubs with my sister; I got the odd number clubs and my sister (who now works for Annika’s golf academy) took the even ones.”
The athletes I interviewed earned millions of dollars playing their sport but none of them came from a wealthy family. All either mentioned – or implied – that they came from a modest upbringing and that both the life lessons they learned growing up and their time as a pro play significant roles in their financial dealings today.
NFL star Desmond Howard grew up in a middle class Cleveland, Ohio, community. “My parents taught me the value of money and importance of working hard,” he said. “I was never flashy … even though I was the number four pick in ‘92 draft. I drove my old beat-up college hatchback to practice at Redskin’s Park every day.
Olympic gymnast Shannon Miller turned pro at age 13 to help cover costs associated with pursuing her sport. “I had a very small endorsement deal with McDonalds, which basically paid for the grips I used on the uneven bars,” she said. “Growing up I had to watch my budget. I carried a notepad around with me when I traveled and would write down every personal expenditure …food, souvenirs, whatever.”
When I asked Deion Sanders if he felt comfortable managing his money when he turned pro. He was quick to reply with a resounding “NO! And anyone who tells you any different is lying. Nobody in my family ever went to college let alone knew what do to with a million dollars.”
MMA pioneer Tito Ortiz who faced major battles at home before ever entering the octagon. “My parents were drug addicts,” he admitted, “and I had to fend for myself a lot. I was the youngest of four kids and a troubled youth until I realized I could get a lot of attention from slamming people to the mat as a high school wrestler.”
Oftentimes, star athletes are perceived as having it made, with no financial worries. But actually, they’re no different than average Joes who have to figure out a plan for saving money, grow their wealth, and protect their legacy.
Savings Formula
Like many of us who are told to save at least 5% or 10% of our earnings, athletes face a larger savings rate considering that they will generally retire 20-30 years younger than most people. Of the athletes I interviewed Annika was by far the most hands-on when it came to saving and investing.
On this subject, Annika said, “I was always very conscious of my money and I saved from the very start. I’m very conservative with my investments and realize it takes some ice in your belly … you know, staying cool and not making emotional decisions. I’m a blue chipper,” she confessed, “and in it for the long haul. I manage my investments the way I play golf. I don’t take risks, and lately I’ve been studying how different investment sectors rotate in and out of favor.”
…..
http://www.forbes.com/sites/robertlaura/2012/05/24/how-star-athletes-deal-with-retirement-financial-lessons
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