When athletes sign their first contracts or score their first high-paying job outside of school, the sudden influx of money can be overwhelming. For many, the temptation to upgrade every aspect of their lives—cars, homes, vacations, and even the way they eat—is hard to resist. This phenomenon, known as “lifestyle creep,” occurs when people increase their spending in proportion to their income. While enjoying the fruits of your hard work is natural, unchecked lifestyle creep can lead to financial stress and, in worst-case scenarios, bankruptcy. To help avoid this trap, athletes need a plan. Here are five practical strategies to maintain financial health and enjoy long-term success.
How to Avoid Lifestyle Creep
1. Create and Stick to a Budget. One of the simplest but most effective ways to combat lifestyle creep is to create a realistic budget and stick to it. Work with a financial advisor to break down your income and set aside specific amounts for essentials, discretionary spending, savings, and investments.
For example, allocate no more than 30% of your income to living expenses (housing, utilities, groceries) and cap discretionary spending (cars, clothing, entertainment) at 10-15%. By doing this, you can control your spending and focus on long-term goals rather than short-term indulgences.
2. Avoid Overspending on Housing and Cars. Many athletes fall into the trap of buying the most expensive house or luxury car to “keep up” with their peers. Instead of buying a big house or multiple cars, consider owning a modest home and a practical vehicle until you’ve established long-term financial stability.
For example, Shaquille O’Neal has often spoken about learning this lesson early in his career. After spending his entire first check on a car and other purchases, his financial advisor warned him to think about the future. The key takeaway? Invest in appreciating assets like real estate instead of splurging on things that lose value quickly.
3. Plan for Life After Sports. The average professional athletic career is short—just a few years for most athletes. Without a plan for life after sports, you may be left with no income and mounting expenses. Start thinking early about how you’ll generate income after your playing days are over.
Consider investing in a business, pursuing additional education, or building a personal brand that can translate into opportunities like public speaking or endorsements. Athletes like Venus Williams, who earned a degree in business administration while competing, have shown how smart planning can lead to financial independence long after retirement.
4. Surround Yourself with Trusted Financial Advisors. Having a team of trusted advisors—financial planners, accountants, and attorneys—can help you make informed decisions. Ensure these professionals have your best interests in mind and aren’t afraid to challenge you on risky or excessive spending.
For example, NFL player Brandon Copeland is known for living on just 10-15% of his salary and investing the rest. His disciplined approach was supported by a strong team of advisors who helped him focus on building wealth instead of spending it.
5. Practice Gratitude and Mindful Spending. Lifestyle creep often stems from the belief that “more” equals happiness. Combat this by practicing gratitude and focusing on what truly matters—your family, health, and long-term goals. Before making large purchases, ask yourself: “Will this bring lasting joy or just a temporary thrill?”
Instead of spending money on material things, consider using it to create experiences or invest in causes you’re passionate about. Athletes like LeBron James and Russell Wilson have used their wealth to give back to their communities, finding purpose and fulfillment in ways that go beyond personal indulgence.
Avoiding lifestyle creep requires discipline, foresight, and a willingness to say “no” to unnecessary spending. By creating a budget, living below your means, planning for the future, and surrounding yourself with trusted advisors, you can build lasting wealth and set yourself up for success long after your playing career ends.