Many advisers will tell professional athletes that they must have a plan for retirement. The plan must include various strategies in order to help them navigate their finances throughout the years. The plan should also include the impact of inflation to offset rising costs. Additionally, they must have correct investment choices and make sure those choices are safe.
However, the number one biggest obstacle for professional athletes is procrastination. Contrary to popular belief, in the world of the professional athlete…not all real estate continually goes up in value. Likewise, the jewelry, the cars, the clothes, all do not go up in value. That being said, within reason, real estate is one of the most sensible investment areas for professional athletes. Rental properties, for example, can provide a relatively stable source of income during quieter work periods. If you would like to learn more about investing in real estate, this Creating an LLC for rental property guide might come in useful. Ultimately, an LLC can be set up to offer asset and liability protection. In the event of a lawsuit resulting from damages in or on a property, the property owner is usually named in the suit. However, if the property is owned by an LLC, the LLC is the entity that’s most likely to be named in the lawsuit.
Of course, there are other ways to invest in real estate too. For example, Management Letting Rights businesses (MLRs) offer a unique way to invest and earn an income and build a saleable asset while still being in charge of your finances. In case you are new to the real estate investment sector, put simply, an MLR business is an enterprise that usually involves the caretaking and letting of townhouse and unit complexes. MLR businesses come with a large variety of financial benefits too. For example, Business finance firms can also provide lending options for management letting rights. Correspondingly, if you would like to learn more about investing in a management rights business, then researching some of the different ways of sourcing finance for your MLR businesses is an excellent place to start. Above all, real estate investments are still some of the most financially secure options for high earners.
Want to learn more about what it takes to buy and sell properties? The real estate industry moves at an incredibly fast pace, but by keeping an eye on current real estate trends, it is much easier to make the right decisions about when is the right time to buy and sell an investment property. For further information about buying and selling property head to the House Buyers of America website here: https://www.housebuyersofamerica.com/.
For those athletes who were raised in a low socioeconomic environment, coming into a great sum of money, pretty much all at one time can be a very daunting experience. We must take whatever education the athlete has about money and finances, which more often than not is the wrong thing, and re-program their education so that they think in terms that money is not just to buy things and Cialis generics, but it’s for security. Online resources that educate people on how to properly handle their finances, such as MyInforms, are not in short supply and can prove very effective in helping people sort out their money problems.
Due to the length of their careers, professional athletes do not have the luxury to wait to invest their money. Procrastinating in the form of “I’ll wait till I get my next contract and I’ll have more money to invest” is almost akin to committing financial suicide. To demonstrate: In the simplest of terms, let’s say an athlete would like to have a nest egg of $1,000,000.00 when his playing days are over in 12 years. Assuming only a 4% return on his money, it would require a monthly deposit of $5,430.00 starting immediately. By waiting merely two years, the monthly deposit would increase to $6,795.00.
Anyone can formulate a plan. It’s easy to obtain tax-free or tax-deferred investments to combat the highest tax bracket issue. Diversification can offset one or two poor investment choices. Procrastination will kill an athlete’s long term hopes and dreams of financial freedom more than anything else.
Disclosures. The information contained herein is neither an offer to sell nor a solicitation of an offer to buy any security. Past performance is not a guarantee of future results. Further, the information herein is intended solely to provide general information and does not constitute a promotion of any offerings or products. Donald J. Kushner is an independent financial advisor with Arque Capital, Ltd., and does business as DK Sports Financial. Arque Capital, Ltd., and DK Sports Financial are unrelated entities. Securities offered through Arque Capital, Ltd. 7501 E. McCormick Parkway, Suite 111 North Court, Scottsdale, AZ 85258. (602) 971-9000. Member FINRA/SIPC. Any unauthorized reproduction of this information is strictly prohibited.