How Pro Athletes Should Prep for Their Retirement


When you take the time to build something, it’s wise to ensure it’s made to last. If you’re building a home, you don’t glue sticks together and call it a day—you lay a foundation and build up from it, reinforcing beams and adding layers of drywall and concrete. You brace it for the elements, insulate it for comfort, and know that it will likely still be standing 20 years from now.

A lot of the same can be said for a professional athlete’s career. You lay the foundation with proper physical training, build increased skill and strategy, and arm yourself with the sports gear you need to succeed. The main difference? Your body will undoubtedly change over the next 20 years, and your career may not retain the same shape it has today.

The physical demands of an athlete’s work can’t realistically be sustained forever, and sometimes, lifestyles and interests pull them in a different direction. This results in many pros opting for early retirement, which may not be as rosy a decision as it initially seems. Unlike other professionals that may have a solid 40 years on the job to prepare for that transition, the short shelf life of an athlete’s peak has left some woefully unready for life after sport. How do you avoid these pitfalls? Let’s take a closer look at what you’re up against, so you can take on the future with confidence.

The Average Timeline of an Athlete’s Career

  • Professional Football (via NFL): 5 years or less.
  • Professional Hockey (via NHL): 5 – 5.5 years.
  • Professional Golf: 3 – 4 years.
  • Professional Baseball (via MLB): 4 – 5 years.
  • Professional Basketball (via NBA): 5 years.
  • Professional Basketball (via WNBA): 5 years.
  • Professional Soccer: 2 years.

While we’ve broken down some of the more popular professional sports, it’s believed that most athletic careers don’t extend past 10 years.

What Goes Wrong?

We know what you’re thinking—”Who cares if their careers are short lived? Some professional athletes make more in one season than most people do in a lifetime.” While that may be true, your net worth can take a serious dive if you don’t know how to properly manage it, leaving you with less in retirement than you may have started out with.

Stats suggest that, a mere two years after retirement, nearly 80% of pro football players are completely out of money. What causes them to go from multi-million-dollar contracts to having absolutely nothing? In short, it’s a lot of financial mismanagement. Making bad investments, blowing their money on frivolous purchases, and the cost of raising their kids (yes, really) are among the list of factors that whittle away their wealth. Beyond that, some run into tax trouble that puts a dent in their bottom line.

In spite of their immense skill and physical stamina, professional athletes are merely human beings, and not all of them have a high level of financial literacy. Some take a hands-off approach to fiscal planning, trusting others to decide how their money is spent and hoping for the best. Others are just enjoying the moment, indulging their whims and revelling in the fruits of their labor.

Society tells the pros that the rich and famous live in the lap of luxury, which usually means overspending in the here-and-now as opposed to saving up for the future. Truth is, this problem extends beyond the NFL alone—over half of all NBA players are in the same penniless boat just 5 years after ending their career, and professional baseball players aren’t far behind. To have achieved their dreams only to fall so far financially is devastating, but in nearly every sad story, there’s an important lesson.

What Can You Do Better?

If there’s any upside to these tales of woe, it’s that they help raise awareness of how important financial planning truly is to the next generation of athletes. If you’re wondering how to safeguard your dollars and cents so they don’t fall flat at the end of your career, we’ve got 5 tips to help you along.

  1. Understand that the ride may be short – No one really knows what the future holds, and what you excel at today may be different 5 or 10 years from now. You could get injured, lose interest, or maybe even chart a new career path in a completely different field. Whatever the case, your circumstances will eventually change, so manage your current income like it has to last you the rest of your life. After all, it just might.
  2. Don’t take any unwise chances – Say you find yourself with a lucrative contract and international notoriety. You may be tempted to drop some of that money into a risky start-up, or aid friends and loved ones in the pursuit of their dreams. Try to avoid these money traps if possible, but if you can’t resist, only invest nominal amounts of your salary into them. That way, any loss you incur isn’t quite as detrimental.
  3. Start considering a second act – Should your athletic career be only a fraction of the length of a traditional one, you could find yourself with a lot of time on your hands. Considering what you’d like to do off the track or field can be a great way to secure income, as many retired athletes who are well off have used their star power in other industries (Michael Jordan, anyone?). Endorsements, coaching, and mentoring may be solid options for those who feel a bit too young to retire.
  4. Save, save, and save some more – Let’s say you found yourself suddenly making millions of dollars each year—taking even a small portion of that and putting it away could mean having it later when the well has run dry (so to speak). Investing in stocks and bonds is a common element to retirement savings, so why not consider that when you’re planning your budget? Sometimes, the answers to complicated questions are tried-and-true, so feel free to think inside of the box.
  5. Trust the professionals – Allow us to clarify here: trust the trustworthy professionals. You may find yourself bombarded with offers from folks promising to increase your tax returns and double your income—don’t fall for a shady deal! Financial professionals, particularly fiduciaries, are obligated to do what is best for you and not for their personal gain. Getting started with one early on can help you avoid some of the mistakes made by those who go it alone, giving you some much-needed guidance while you…well, keep your eye on the ball. Reach out, shop around, and take some of the weight off of your shoulders.

PPG-144266 (3/19) (Exp. 3/21)

About Dayton & Sydney

Dayton & Sydney Wealth Strategies Group is a financial advisory company built on a legacy of hard work and customer service. As an elite producer group of AXA Advisors, we use a solid, innovative and long-term approach to help you accomplish your biggest dreams.

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