We’ve all read those headlines about athletes ‘who go broke’ and similar narratives. While it’s not easy, it’s so important that we as athletes (and as responsible people) do what we can to grow our wealth. Building wealth takes time, but with proper strategy and dedication, it is possible to leave a sound legacy for you and your family.
Building a Legacy: 6 Ways Atheltes Can Build Wealth
Understand your net worth. Knowing what your debt to asset ratio looks like is a great first step in building wealth. When I first went on my journey of building wealth, I wanted to know what my net worth looked like so I could set up my plan of action.
Set goals. Any athlete knows that goal setting is crucial for success on the playing field. The same goes with financial goals. I created very specific short-term and long term goals for myself years ago. To start, a few of my few short term goals included paying off debt, buying a starter apartment, and saving in advance for small splurges like new clothes and vacations.
Spend wisely. It’s very hard to grow any kind of wealth if you spend everything you make. A few ways I contribute to my wealth over time is to practice disciplined spending habits: I use coupons at the grocery stores, I try to buying clothes on sale, and I limiting how many times I go out.
Build your savings. Your savings account comes in clutch. Unexpected expenses like car repairs, medical bills, or taxes can set you back financially. Making an effort to build a cash savings account can help you dodge credit card debt or other setbacks that prevent you from building wealth.
Max out retirement. If you work at a job where your employer contributes to your retirement fund, take advantage of it! At my first job I didn’t sign up for a retirement plan because I felt like I was barely making ends meet. However I found a new job, I took full advantage so I would waste an opportunity to get free money.
Protect yourself. Having basic coverage to protect you and the ones you care about is another big part of building wealth. Besides having health insurance, Kurt and I took out life insurance and disability insurance to make sure we protect each other from unexpected accidents. Having insurance to protect us from an unforseen tragic event will also protect our daughter, as insurance money can insure her basic needs are met in life.