How to protect those who are suddenly wealthy.
Professional athletes and entertainers are subject to unique circumstances, especially those who have a quickly growing career. This article looks at the challenges high-profile entertainers and athletes face and how our dedicated team appeases those concerns. Life is full of challenges that require experts’ assistance, including maintaining the life of a high-earning individual.
Why Athletes and Entertainers need financial services
The average professional athlete earns nearly $13 million in the span of their career, which has a medium length of roughly four years. This figure is slightly skewed due to some high earning individuals as the high end of the range is multiple times the average. No matter where an athlete falls on the pay range, each faces a similar problem; wealth management. According to Sports Illustrated, within two years of retirement, 78% of former NFL players have experienced bankruptcy or are financially unstable. Within five years, nearly 60% of NBA players are completely broke. Many athletes obtain a large amount of wealth over a short period of time, leading these individuals to elevate their lifestyle, causing a spike in their living costs. When their career is over, which could happen quickly, they may choose to continue this lavish lifestyle without the same cash flow.
There is also a misconception that athletes are pocketing all of their career earnings; in reality, they may only be keeping a quarter of their income. Following travel costs, business management, and agency expenses, athletes only get the remainder. So, as you can see, some athletes aren’t even able to achieve a lavish lifestyle. But, with some smart investing, they still can.
Services for Athletes and Entertainers
Under these unique circumstances, professional athletes and entertainers, and social figures are a demographic that requires financial and personal management. Athletes do not only need coaching on the field but off the field as well. Let’s take a look at some of the services our professional and entertainer clients inquire about.
Professional athletes and athletes risk making poor financial decisions during and after their careers, leaving them with little to no money and no way of rebuilding. When they first see that a large amount of money can afford them, they often overindulge. With a proper wealth management plan, these individuals can learn lessons in maintaining their money through smart investing, lifestyle choices, and preparing for the future. Even those hoping for a more modest lifestyle can use wealth planning to make the proper investments to sustain their life, plan for retirement, and put some funds away for children or other beneficiaries.
There is no wealth management plan out there that can be applied to everyone and find success. A wealth management plan takes a lot of consideration, such as the individual’s goals and current portfolio and extensive knowledge of wealth planning options. Portfolio management may be one of the most critical steps in a professional’s financial planning. If planned well with smart investments while receiving their high income, their assets may be able to continue their income after their career ends or could be the tool they need to take advantage of other life ventures that can earn them a living.
High-earning professionals also seek asset protection. Once we assist our clients with wealth planning, the next natural step is to create a plan to protect those investments. Remember, some of these high-earning athletes may have a short career and can be over in less than a decade. They don’t want to lose a substantial amount of their wealth due to a lawsuit. Diversifying their income is one of the easiest ways to protect their assets and investments from risk. Of course, there is always the possibility that one of your sources of income may take a drastic hit, but if their investments are in many different markets, those losses don’t hurt as much overall.
Professional athletes and entertainers work hard and deserve to live a little. However, if they put the work into securing their finances and can afford frequent trips, the opportunity to host guests, or get into elite events, they shouldn’t have to do it all alone. Whether our clients want to spend their free time relaxing or want an active lifestyle of travel and glamour, our team of experts can ensure these individuals have the best of the best when it comes to event planning, traveling, access to special events and more with private concierge services.
Many of our high-earning clients want to make investments that align with their interests, such as collector cars, art, or other hobbies. We can help acquire and manage those assets as well. Investing in antique and classic cars and art can be a great option compared to traditional investments, largely due to the possibility of high profit.
Dedicated Sports & Entertainment Team of Alpen Partners
Building on 20 years of experience in the financial industry, Alpen Partners dedicates an entire team of specialists to serve the specific needs of our athletes, entertainers, and top professional clients in the sports and entertainment industries. Whether they are emerging talents or seasoned veterans, Alpen Partners helps athletes and entertainers secure their financial footing and structure their finances in every phase of their career and life. Clients include athletes in the fields of professional basketball (NBA), tennis, golf, Formula 1, and soccer. We also assist actors, film producers, singers, musicians, and music producers. We utilize close interaction with our clients as the heart of our process in order to fully integrate each client’s vision and core values. We pride ourselves on being a fully independent entity, able to activate all external resources and competencies needed in order to deliver services with asset protection, growth, and monitoring, life simplification, and cost-cutting at the forefront of our strategies.