January 2, 2013
A principal owner of Garden State Securities in Red Bank, New Jersey, Kevin DeRosa served as the firm’s CEO for four years. Kevin DeRosa began advising clients on financial matters 20 years ago. He counts his brother, a Major League baseball player, among his clients.
Media outlets often report that professional athletes have received multimillion-dollar contracts that span five or 10 years. Unfortunately, in many cases, athletes spend as fast as they earn, and they do not plan for the future. Below are a few of the issues they face.
1. Asset protection. Many athletes marry or divorce during their careers. To protect their premarital earnings, they may want to establish trusts.
2. Support of family and friends. Athletes may feel the need to give generously to their loved ones. In some cases, however, this can lead to financial setbacks. A solid financial plan can help mitigate this risk.
3. Legal forethought. Some players aspire to entrepreneurship during and after their athletic careers. To protect themselves, they may want to meet with reputable legal counsel to determine the right structure for their business, such as a limited liability corporation.
4. Reliable advisory team. Athletes should exercise care when they choose their accountants, attorneys, financial advisors, and other personal management professionals.