Ok, let's be real hiring a qualified financial advisor as a professional athlete feels like finding a needle in a haystack.
It is estimated there are more than 300,000 financial advisors (loose term) in the United States today.
Some are ok
Some are bad
Some are good
Few very are qualified to help professional athletes
Look, let's eliminate the handful of financial advisors that are not doing good work. That leaves us with a handful of financial advisors that are good people with good intentions.
For the average family, that might be enough.
For a professional athlete, we haven't even reached the starting line.
When it comes to athlete wealth management, the only advice you should be looking for is level-three advice.
They have helped others do it. (Level 1)
They have done it themselves. (Level 2)
They have walked in your shoes. (Level 3)
Look I don't say this lightly, your choice of a financial advisor is arguably the most important one you can make for your career.
The reason? This team will be with you before, during, and after your playing career. They will be tasked with making sure you maximize every dollar you earn.
Money mistakes are a professional athlete are not like stubbing your toe, it is like breaking your leg.
The impact is wide-ranging and there is no going back for a second chance.
In this blog, I am going to share the questions to ask, things to consider, and the red flags I wish I knew about choosing a financial advisor when I was a top 10 MLB draft pick.
Wealth Management Questions For Professional Athletes
When I first met with a financial advisor, the only question running through my head was, "What does this person even do?"
My family didn't grow up with financial advisors and the first time I even heard of one was when the MLB draft was approaching.
I remember meeting, thinking the individual was nice, and asking no questions.
I left thinking, well he seems like he won't take advantage of my situation so I guess I will hire him...
Athletes, this is not how you should conduct your process of finding a financial advisor for professional athletes!
The good news is to do it right you don't need to be an expert ~ you just need to be armed with the right questions.
Here are seven to ask as a professional athlete ⬇️⬇️⬇️
7 Questions Professional Athletes Should Ask Financial Advisors
1. What do you specialize in?
If you look at most financial advisor websites, they have an older couple walking on a beach or some picture of an abstract lighthouse. You browse over to the section about who they serve and it looks like something in line with the menu at the Cheesecake Factory (literally can choose anything).
That my friends is not specialization and not what you are looking for.
Consider if you had an injury. You would go to a doctor that specifically worked with professional athletes. Depending on the type of injury or necessary procedure you would then be referred to a specialist that only works on that specific injury.
Just like your doctor, you want your choice of a financial advisor to be just as specialized.
You are the best in the world at what you do, they should be too.
2. What areas do you cover?
The first thing everyone thinks of when it comes to financial advisors is investments. Rightfully so, investments and your subsequent returns are very important.
Yet, I would argue that before you ever invest a dollar there are several other areas that need to be covered first.
Things like:
Income Planning
Tax Planning
Risk Management
Estate Planning
Financial Team Coordination/Structure
To me, this is one of the biggest areas that is missed. The reason for this is twofold. One it takes a great deal of work to navigate each element of this and two it takes deep expertise to understand how this works in athlete wealth management.
At Moment, we cover our athlete's entire financial life. If it has a dollar sign in front of it, we want to be helping to educate and guide you.
3. Do you invest the same way as your clients?
You might be thinking, well ya duh of course...
Let me tell you, that many financial advisors sell clients one investment solution only to do something completely different in their investment portfolio.
Now look, I am not saying it has to be the exact same. Let's be real your goals, situation, and circumstances are unique and require a customized solution.
That being said, the general frameworks, ideas, and solutions should look similar.
After all, if they are good enough for you they better be good enough for your financial advisor.
4. What are all the costs involved in working together?
My two rules when it comes to fees are this:
You should understand them and you should know the total costs.
By understanding them, I mean your financial advisor should be able to write those fees in crayon for you.
When I say total costs, this means the costs of the advice, products, solutions, and any additional fees that might apply.
My industry (financial services) is awful when it comes to clarity around fees. I see time and time again professional athletes paying substantial hidden costs.
At Moment, we have one simple fee clients pay. We receive no kickbacks (very common), sell any commissionable products (layers of hidden fees), or receive any trails from investment companies (often never seen).
Our job is to provide our clients with a multiple of the value for the fees they are paying us.
5. What is your advisor-to-client ratio?
The average financial advisor serves north of 100 families. This model can work well for the average consumer but remember you are far from average.
Remember when asking what areas a financial team covers that their service model should be reflected in their client-to-advisor ratio.
Our model for professional athletes means we are involved in everything from large purchases to car shipping to the investment portfolio.
This level of client service means that we limit the number of clients an advisor is serving.
It means more focused time serving each professional athlete.
6. What does your average client look like?
Nick Saban has this famous line that you need to find the right people and put them in the right seats.
As a professional athlete, you need to consider that you need a firm with the firepower to serve you today and into the future.
The future might mean early retirement or it might mean a $100,000,000+ contract.
Our average client has a net worth greater than $5,000,000. I say this because it means the planning strategies, conversations, and solutions are designed with high-net-worth and ultra-high-net-worth clients in mind.
As a professional athlete, your financial plans are decades in the making. You want to make sure the team you hire has the ability to serve you today and in the future.
7. What qualifies you to work with professional athletes?
I love this question. I love it because it will give whomever you are talking to a chance to share what they value as the most important thing.
It could be investments.
It could be their experience.
It could be their credentials.
Well here is my answer:
First and foremost we are experts.
At Moment, our teams for professional athletes include a CFP (Planning), CPA (Tax), CFA (Investment), CLU (Insurance), and JD (Legal). The best part? we find the best people across the country to integrate into this team. You aren't limited to just the person down the hall.
Second, we have walked in your shoes.
I have signed the big contract. I have felt the anxiety around the money. I have navigated all the highs and lows that come with professional sports. I have successfully navigated my finances. I have transitioned from my playing career to a successful second chapter.
Third, we built this company with you in mind.
Every decision we have made at Moment has been with a laser focus on our ideal client, the professional athlete. Our meeting schedule, service model, and communication are all designed for your specific needs.
Remember how I said you don't need to be an expert to find a qualified financial team? If you use these seven questions you will be ahead of 99% of professional athletes.
To me the vetting doesn't stop there, you also need to watch out for red flags.
Trust me when it comes to athlete wealth management there are plenty.
Here are my three biggest ones to watch out for ⬇️⬇️⬇️
1. Fear Based Selling 🚩
"If you don't do x, y will happen." I see this all the time with professional athletes.
Look it makes sense because often we are coming into this money with little education.
We have a target written all over us and the last thing we want to do is make a mistake.
Do not let anyone sell you any product/solution based on fear. You need to understand what you are buying, why you are buying it, and all your available options.
2. Name Dropping 🚩
We are dealing with someone's entire financial life. This is not public information and neither should their client list.
I watched advisors pitch me while name-dropping other athletes they worked with. A few things to understand, just because they say they work with that person doesn't mean they actually do. Even if they do it doesn't make them a good advisor. If they are name dropping to get you as a client they will be selling you to the next client.
***I always recommend when the time is right to ask to speak to a current client and have them share their experiences.
3. Pitching Investments Only 🚩
Investment returns matter, they matter a lot. Yet, they are just one piece of your entire financial picture.
Your cash flow will be uneven.
Your taxes will be your largest lifetime expense.
Your liability exposure will be heightened as a public figure.
These are all key components of athlete wealth management and you want to make sure that your financial team is covering more than just your investment portfolio.
You are in the top 1% of your craft as a professional athlete.
You want to make sure that your financial advisor is also in that top 1%.
It can feel overwhelming but use this to narrow it down:
Level 3 Advice
7 Questions Above
Listen For 3 Red Flags Discussed
Doing just those three things will set you off on the right path. My goal since retiring from baseball has been to educate as many people about personal finance as possible.
This blog is another effort in that journey, I hope you enjoyed reading it as much as I enjoyed writing it!
If you are a professional athlete looking for a financial team specializing in you, schedule a call, and talk with a Moment founder.
For further resources, check out my YouTube as it has deeper dives into many of the challenges professional athletes face.
Get in Touch With An Advisor
Frequently Asked Questions
Here are some answers to questions I received frequently about this topic.
Are you a fiduciary? Moment Private Wealth serves clients as a fiduciary 100% of the time.
How does Moment Private Wealth make money? We are only paid in one transparent way, by our clients. We receive no kickbacks or participate in any profit-sharing arrangements. Our fees are simple, transparent, and clear for our clients.
How are you different than other financial advisors? We are specialists in working with professional athletes and entrepreneurs. We limit the number of new clients we take on. This allows us to provide unparalleled value and highly personalized service to professional athletes. We work as a team to service our clients. We believe in building a team of “A” players. This ensures our clients receive world-class tax, estate, insurance, and investment strategies. We focus on educating first, then executing.
Where do you hold my investments and how can I see them? Moment Private Wealth uses Fidelity Investments as a third-party custodian for our client investment accounts. As a third-party custodian, Fidelity safeguards and provides reporting to you and the IRS each year. Clients can also access all financial information via the Moment Private Wealth Client Portal.
How do you work with other members of my team? We believe in the power of the team. For most of our clients, their team consists of Moment Private Wealth, an accountant, an attorney, a banker, and an insurance specialist. We help our clients build out their team of individuals or work with existing partners clients have. Our goal is to ensure every family has a team of experts to protect their interests.
How do you choose investments for clients? As independent financial advisors, we can gather research and make recommendations based on all available options. We determine clients’ portfolios in partnership with some of the largest asset managers in the world. Each quarter, we have calls with teams of CFA (Chartered Financial Analysts) to ensure our clients are receiving the most up-to-date strategies and recommendations.
What does your average client look like? Our clients are nearly all athletes and entrepreneurs. Our average client has a net worth greater than $5M. The strategies, solutions, and planning that we implement have a high-net-worth and ultra-high-net-worth client in mind.
Why should I consider hiring Moment Private Wealth? Great question! But first, let us explain why you shouldn’t hire us. If you’re looking for an advisor who will pitch shiny object investments or be a “yes man” you are in the wrong place. Why? Because we believe in being truth tellers and only giving advice that we take ourselves. The investments, strategies, and planning we do are all things our advisors do with their own money. If you are an athlete or entrepreneur interested in things like lowering your tax bill, investing smarter, and finding a trusted partner we might be a good fit.
*Moment Private Wealth offers information on tax and estate planning that is general in nature. Tax and Legal advice are not provided by Moment Private Wealth. Consult an attorney or tax professional regarding your specific legal or tax situation.
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