THE IMPORTANCE OF SAVING EARLY FOR SPORTS PROFESSIONALS
Just as you invest in your body, health and playing skills, invest in your financial education.
It is no secret that becoming a professional sportsperson requires years of hard work and dedication. But what many people don’t realise is that starting to save for your career as early as possible is also critical. That way, you can be sure that you have a solid financial foundation to support your future career.
Fame, big-money contracts, lucrative endorsements, and lavish lifestyles are often associated with professional sports people. Unfortunately, so are many stories of “rags to riches to rags” due to making poor financial choices.
Even though some professional sports people can make more money in a few years than most workers make in their lifetimes, there are a number of reasons why it’s important to start saving early. Saving early and often is crucial for anyone who wants to retire comfortably, but it’s especially important for those in the sports world.
It gives you a head start on meeting your financial goals and it’s also important to remember your career as a professional sportsperson is likely to be shorter than most other careers. This means that you will have less time to save for your retirement or other financial goals.
The sooner you start saving, the less likely you are to experience a financial emergency. You never know when an injury or other unexpected event could force you to retire from playing sports. If you have saved money for a rainy day, it can help you during this difficult time.
As your income as a professional sportsperson is likely to be higher than the average person’s income, this means that you could afford to save and invest more of your income than the average working person.
Here are some advantages of saving early:
1. Saving for your future is important whether you’re a professional sportsperson or not. But as a sports professional, it’s especially crucial that you start saving to take advantage of your money compounding. When you save money over a long period of time, the interest and growth that accumulates on your original investment can be significant. By starting to save early, you give yourself the opportunity to earn more money through the process of compounding.
2. You can ensure a comfortable retirement. Many people from the sports world earn a lot of money over a relatively short career, meaning they could be caught out when it comes to retirement. The older you get, the more expensive it becomes to live comfortably in retirement. If you start saving now, you could have enough money saved up to cover your expenses and lifestyle in retirement.
3. As a professional sportsperson, you may need to take greater risks in order to reach the top of your sport. By saving early, you reduce the risk that you’ll have to compromise your career or finances if something goes wrong.
No matter what type of investment you choose, it is important to start saving as early as possible. The more time you have to save, the more likely you are able to reach your personal financial goals. Just as you invest in your body, health and playing skills, invest in your financial education so you can feel empowered when it comes to money.
HOW A WEALTH PLANNER CAN HELP AND ADD VALUE
As a team of Wealth Planners and investment experts who are highly experienced and focused on working with professional sports men and women, we understand how to help you plan for financial independence and the life you want to live.
A Wealth Planner can help you:
• Identify your investment and retirement goals.
• Analyse and quantify how much needs to be saved to meet those goals.
• Help you to start and carry on a good discipline of saving regularly.
• Create a suitable investment strategy.
• Make your portfolio as tax efficient as possible.
• Show you what retirement could look like through Cashflow modelling.
• Make sure the plan put in place is reviewed and suitable to meet your goals year by year.
READY TO START A CONVERSATION?
With the possibility of a shorter career, fluctuations in earnings and the risk of career ending injury, it is important to start financial planning at an early stage. If you would like to discuss your unique situation, contact SWM to be introduced to a Succession Wealth Planner.
Succession Sports & Entertainment is a trading style of Succession Wealth Management Ltd, which is authorised and regulated by the Financial Conduct Authority. Financial Services Register number 588378.
Succession Sports & Entertainment is a trading style of Succession Financial Management Ltd, which is authorised and regulated by the Financial Conduct Authority. Financial Services Register number 225831.
The following companies are registered in England at Drake Building, 15 Davy Road, Plymouth Science Park, Derriford, Plymouth, PL6 8BY. Succession Wealth Management Ltd, Registered Number: 07882611.
Succession Financial Management Limited, Registered Number: 04454027.
Please note: This article is for general information only and does not constitute advice. The information is aimed at retail clients only. The Financial Conduct Authority does not regulate advice on taxation, trusts, estate planning and cashflow planning.
The value of your investment(s) and the income derived from it, can go down as well as up and you may not get back the full amount you invested.
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