Life after sport: prepare now, or regret later

What sports professionals need to know about effective financial planning strategies

Football Boot 178624334
Peter Fairchild, Luke Brooks
Published: 07 Feb 2020 Updated: 20 Jul 2022

Few will experience the highs, lows, glamour or pain that makes up the life of a professional sports star.

It’s an intense period, and even if you are lucky enough not to suffer a career threatening injury, a professional athlete will have a career no longer than half that of the average City worker. That is a lot to be crammed into a short period and leaves very little time to plan for your life after sport.

Professional athletes are just like other people – they need to keep a roof over their heads and put food on the table. This needs to happen long after their playing career is over. This doesn’t happen all by itself; taking control of your finances will help you prepare for a new life and career after sport.

Pensions are not enough

Athletes these days – especially footballers in the higher echelons of the football league – will earn good money – but only while they are playing. Many will be retired by their mid-thirties, with more than half their life still in front of them.

A pension used to be the primary source of income in retirement, but gone are the days when you could make large, infrequent contributions into a registered pension scheme, which you could access from the age of 35. Since 2006, athletes have had to wait until the age of 50 to get their hands on their pensions. This became 55 in 2015 the same as everyone else – and the minimum retirement age is expected to be pegged to 10 years below the state pension age in the future. This means that the minimum pension age will increase to 56, then 57 and will ultimately settle at 58 for the current crop of sports stars.

Tax rules have changed, so even if you were prepared to wait, those earning more than £210,000 a year can only pay £10,000 into a pension plan. And what do you do between retiring and your 55th birthday, if later?

These changes have hit professional sportspeople hard. The simple truth is that while everyone else in the country is being told to save into a pension, sportspeople need a more nuanced approach.

From hero to zero (income) – don’t forget your future

You might be earning a decent wage now, but the bills don’t take care of themselves when you retire. Retirement may coincide with the most expensive time of your life, with a sizeable mortgage, a growing family, and some serious outgoings. Professional athletes must be aggressive in saving for their future, because the time they can invest their earnings is relatively short. True, you could be the next Alan Shearer, but not many players manage the transition to well-paid media work. Equally, very few players get to hit the big time as managers.

Don’t leave your future career to chance. It can be worth investing in yourself to develop a skill or even get a trade. That is an investment that will deliver returns throughout your lifetime.

Cashflow is king

Even with some clear career goals in mind, your earnings are likely to fall. You will need to think how you will make up the gap. That starts with an assessment of how much you need once you hang up those boots/spikes/lycra. Plan your cashflow; if you think you need £10,000 a month, double it, because tax, national insurance and other charges will halve it.

Consider a broad investment portfolio. Elements of it should be readily accessible, such as cash, ISAs or rental property income, so you can draw an income. Blend these with longer term investments to create a diversified portfolio. This means all your eggs won’t be in one basket and you can invest in higher risk/higher return areas such as the stock market without worrying about its highs and lows.

Don't forget medical cover. Athletes are used to the best and having put their bodies on the line, they often carry war wounds into retirement. However, a 35 year old footballer will find their cover will cost considerably more than someone who works in an office.

Ready, set, save

There will always be temptation and peer pressure, but trying to keep up with your team mates’ spending habits can be a fast way to lose money, particularly as your playing career draws to a close. Bankruptcies among sports professionals are all too common. This is sometimes because they were badly advised, or they’ve fallen foul of the tax man, but one way or another they haven’t been able to sustain their lifestyles once their careers ended.

Being an athlete is exciting, but you must think about what happens once the final whistle goes. Saving isn't easy for anyone, but it pays dividends for those with short careers to start early. Then you can enjoy more of your rewards at leisure, instead of racing towards the cliff edge.


Find out how we can help sports professionals

By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.

Tax legislation is that prevailing at the time, is subject to change without notice and depends on individual circumstances. Clients should always seek appropriate tax advice before making decisions. HMRC Tax Year 2022/23.


This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.