I am not a huge football fan, but even I know that there is a BIG GAME coming up. It may seem, that these giants among men have nothing in common with us mere mortals. (After all, that is why they get the seven figure contracts, right?) In truth, the hurdles they face are not so different from those that the rest of us do.
Please enjoy this quick list of 6 estate planning fumbles that NFL pro-athletes commit. Let their errors serve as a warning so that you will become the MVP and your family will hoist you on their shoulders. OKAY, that might be too much to expect, but, a solid estate plan can decrease taxes paid to the state and federal government and increase family harmony. Isn’t that better than being drenched in Gatorade?
1. Living Only in the Moment
Unlike the general population, a professional athlete has an extremely compressed earning timeline. Whereas a business executive can expect to amass his/her wealth over half a century, usually making more money in their 60s than their 40s, a professional athlete’s primary breadwinning years happen in their 20s and 30s, and then drops off precipitously after that.
Since they are so young, professional athletes may balk when it comes to starting a financial plan, thinking it’s something they can do later in life. In this respect, pro-athletes are very similar to the majority of Americans. Having no estate plan is by far the biggest mistake people make. It is an epidemic problem among the general population and it’s worse among pro athletes. Statistics show that 60 percent to 70 percent of Americans don’t do any estate planning. It’s probably closer to 80 percent to 90 percent for pro athletes.
*TIP- We all have busy schedules and it is easier to put this uncomfortable topic off for tomorrow, but no one knows how many tomorrows there will be. Plan today and rest assured tomorrow and every day after.
2. Creating No/Weak Team
Though they have played their entire careers as part of a team, pro athletes may struggle to build a team of financial advisors and estate planners. Or more accurately, the right team of advisors. Many times, a professional athlete relies on family members or friends to guide their financial decisions, a path that can sometimes lead to ruinous consequences.
The best estate plans are created through a consistent and comprehensive dialogue between professional advisors. Your estate team should include an attorney specializing in estate, business and tax matters; a CPA; a financial planner/money manager; and a property/casualty/liability insurance specialist. These team members, each specialist in their field, will create a comprehensive guide to move the ball down the field.
*Tip-Be in contact with your estate planning team often. Let them know about any life changes or new sets of goals.
For more information about estate planning and administration, please contact our office.