How athletes can ensure financial security
16 November 2018
Ciarán Medlar, Partner, was recently featured in The Irish Times* article 'When the final whistle blows'. The article, written by Barry McCall, explores the topic of retirement for athletes and how they can deal with the transition. Ciarán gives his view from a financial standpoint.
In the article, Ciarán emphasises the importance of financial planning for athletes. He points out that most athletes have high earnings for only approximatelty 10 years of their career, so planning for what is ahead post-career is crucial.
Ciarán also recommends that athletes should make conservative investment decisions given that bankruptcy in the early years of retirement is common among former athletes.
While retired athletes may face challenges when integretaing themsleves into the workforce, Ciarán says that sports people can take advantage of tax relief that is available to them. "They can take their 10 best years earnings and take 40 per cent of that income out of the tax net. They get that money back in a lump sum and this can help them through the transition when they are looking for something else to do." Moreover, he says that professional sports people can put a significantly larger amount of money into their pension fund quite early.
Ciarán ends with an example of how many athletes have been successful with their investments. "Some athletes look at investing in projects where they can get directly involved and learn about the business and how it operates. This can be in hospitality or another type of business."
While there are many avenues which athletes can enter into after their sports career, having financial security becomes especially important as this will give them the time and resources to figure out what their next move will be.
Article adapted from The Irish Times, available online.