Athletes today earn salaries that should make them financially secure for life. Unfortunately, however, many athletes finish their careers without the financial security they expect. According to a 2009 Sports Illustrated article, 78% of NFL players file for bankruptcy or face financial hardships within two years of retirement. NBA players face a similar fate, with 60% of players going broke within five years of retirement. How is it possible that so much money disappears so quickly? More importantly, what can athletes do to make sure they don’t become just another statistic?

Unlike business professionals, who have experience and education in dealing with financial affairs, most professional athletes lack practical experience in managing large sums of money and fail to receive the formal educational training necessary to learn how to handle their finances. More like lottery winners than corporate executives, athletes come into a large amount of wealth at one time, when they are young and inexperienced, and have careers where the earning potential is short. Couple these facts with overly-generous hearts and a desire to live the “good life,” and its not surprising why the money fails to last a lifetime. 
By taking the following pieces of financial advice to heart, more athletes will attain the same success in their financial lives that they enjoy on the field or court:
1. He Who Dies With The Most Toys Does NOT Win!
Athletes need to be aware of the “lure of the tangible” or “keeping up with the Joneses” mentality. Athletes face tremendous pressure from outsiders who expect them to live an ostentatious lifestyle and from competition with their own peers. The pressure felt in the locker room can be tremendous. However, it is critical for athletes to avoid the overspending that comes with conspicuous consumption. Instead, each individual should learn to live a comfortable, but sustainable, lifestyle while living within his or her means. As I sometimes ask my clients, "Would you rather live like a King for a few years and die broke or live like a Prince forever?"
2. Help Family And Friends, But DO NOT Enable.
Even though it comes from a good place, sometimes an athlete’s desire to help a family member (or friend) does more harm than good. Athletes need to be careful about giving cars and other material items to people who aren’t otherwise able to pay for such things themselves. Not only can giving such gifts create ongoing financial obligations for the athlete, but this also fails to help the recipient take steps to become self-sufficient. Some assistance is good, but not when taken to excess. Instead, think about paying for someone’s tuition or job-training, which will enable the person to develop skills to become self-sufficient. Strange but true – creating dependency hurts those you are trying to help.
3. Surround Yourself With A Team Of Professionals.
Athletes today are not just players, but large businesses – they are their own individual companies. While the athlete is the CEO, he or she should be supported by competent and trustworthy professionals. Athletes must undertake proper due diligence in selecting their financial advisors (and other professional team members) to assure that a system of proper checks and balances exists. Hiring professionals means not just hiring people to say “yes.” Rather, athletes need experienced advisors who can help spot the risks and provide enough information to help them make informed decisions. 
4. Your Finances Should Be Built Upon A Solid Foundation.
Think of wealth accumulation like a pyramid. The reason the Egyptian Pyramids have survived so long is because they are built upon a solid and large foundation. Similarly, an athlete’s finances must be built upon a solid foundation (of cash, fixed income, and “blue chip” stocks). While private deals, real estate, and “sexy” investments (like restaurants, bars, and music production companies) often sound more exciting to athletes, there is no need to take unnecessary risk. If a solid foundation is established first, with a slow and steady methodical approach, there will likely be room for some of these other opportunities later (in reasonable amounts). However, taking unnecessary risk with alternative investments too early could significantly damage the foundation, causing the whole pyramid to crumble.
5. Always Be Cautious!
If an investment return sounds too good to be true, there is a reason – it is usually illegal or extremely risky! Be careful of investing with friends or in “get rich quick” schemes. Ignore these overtures and let your financial advisor help evaluate the true quality of an investment opportunity. Remember athletes should hire financial advisors for their expertise, not for their friendship. Also remember the other side of that coin – that just because someone is a trusted friend doesn’t mean that he or she is qualified to give investment advice. 
6. Live Within Your Means & Maintain Reasonable Expectations.
Everyone wants to have a nice lifestyle, but how many cars and homes does anyone really need? Athletes are goal-oriented by nature and setting financial goals that are measurable is a great way to help establish financial security. One goal to strive for: be debt free by the end of your playing career. Be careful not to overextend through credit cards and debt, as the true measure of wealth and power is not how much you earn or how many houses you own, but how much you save! As a Financial Advisor, I often remind my clients that my job is not to make them rich, but to help KEEP them rich. The single biggest determining factor is how much the athlete spends vs. saves.
7. Its Never Too Early To Start Planning For Your Retirement.
Beyond skill and hard work, part of what enables professional athletes to succeed is self-confidence. However, one major pitfall to attaining long-term financial security is overestimating the length of one’s career. When it comes to financial well-being, athletes should plan as if their current contracts will be their last. Most professional athletes feel invincible, but they aren’t! An athlete should not rely on saving for retirement from his or her next contract, because there might not be another contract. It is never too early to start planning for retirement and the athletes who have the most success are the ones that start planning early and contribute to a retirement fund from every paycheck.
8. Educate Yourself!
While most athletes are not formally trained in finance, everybody should develop an understanding of the basics of handling money to succeed financially. The financial advisor’s job is not only to execute a financial plan, but also to help educate about financial affairs. Take the time to establish a budget with your advisor that you track and review regularly. Similarly, take an interest in your portfolio so that you understand how it is managed. Don’t ever be afraid to ask questions. Remember that nobody should care more about your finances than YOU! 

Justin Bass is a Managing Director in the Sports & Entertainment Group at SunTrust Bank where he oversees the financial and business affairs for numerous professional athletes. Justin is a Cum Laude graduate of UCLA and obtained his law degree from University of California, Hastings College of the Law.  Justin taught Sports Law as an Adjunct Professor at University of San Francisco, School of Law from 2004-2006 and has served on the Board of Directors for The Giving Back Fund since 2009. Justin can be reached at