Fame, big-money contracts, lucrative endorsements and lavish lifestyles are often associated with professional athletes. Unfortunately, so are many stories of "rags to riches to rags" due to poor financial choices made by these superior athletes.

Sports Illustrated published a study finding that 78% of NFL players filed for bankruptcy or were in financial distress within 2 years of retirement from football. The NBA shared similar shocking results with 60% reported to be broke within 5 years of retirement.

All Advisors Are Not Equal

Successfully building wealth requires more than buying financial products. A fiduciary relationship with an advisor is never transactional. Meaning, whomever is advising you should not be making money by selling you a product or moving you in and out from one investment to another. It is important you establish an advisory relationship based on an agreed-upon fee, either on the assets that are being managed (such as a flat percentage fee of 1% or less on the total assets) or a fixed-dollar fee based on the services being delivered. This would be the sole form of compensation your advisor would receive versus having him or her make a piece of every transaction. This affords true transparency and aligns your interests with theirs.

Financial Planning is Essential

Another important aspect to your advisor selection is their ability to do ongoing financial planning. Helping you run forward-looking scenarios based on your earnings, years under contract, spending, purchase choices (like homes and cars), tax bracket and family support needs will help you make educated decisions regarding your future. Also, a carefully created financial plan based on your own goals and priorities will be the best foundation from which to make investment choices. Without a plan as a guiding roadmap, you may be selecting investments that appear favorable in the short-term but that end up moving you further from, rather than closer to, your most important goals.

Your Financial Quarterback

Your wealth advisor should also play the role of quarterback, not with a ball, but with your other advisors, such as your tax accountant, estate and business attorney, insurance agent, banker and bookkeeper. Making sure this team of professional advisors is working together efficiently is critical to your long-term success and independence.


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The opinions voiced in the articles are for general information only and are not intended to provide specific advice or recommendations for any individual. All investing involves risk including loss of principal. The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws are subject to change. Integrated Financial Group and LPL Financial do not provide legal advice or services. Randall Kessler is not affiliated with LPL Financial.