1 Rule: The money you earn as a professional athlete should go towards buying assets that will either generate cash flow or appreciate in value. 

Spend as little of your salary as possible on your personal expenses. The idea is to use as much of your salary as possible to buy assets you can live off of interest income, dividend income or rental income.

You can also buy assets that tend to appreciate in value overtime such as Bitcoin, land or gold. Even luxury collectible items such as watches or art could be good investments that appreciate over time. These don’t generate cash flow but if you buy these at the beginning of your career, it’s possible they could be significantly more valuable by the time you retire. 

Assets that generate cash flow:
If you buy an asset such as a multi-family apartment complex for $1,000,000 and earn 8% interest a year, that’s $80,000 in recurring income every year you have to cover your personal expenses.

Another example is you can lend money to Bitcoin and cryptocurrency holders on platforms such as Nexo.io and earn up to 8 – 10% on US dollar equivalent, stablecoins. Again using the round number of $1,000,000 you can earn $80,000 – $100,000 annually in interest income.

Assets that appreciate in value:
There is a huge unknown sum of money in the world and in 2020 alone the US Treasury and Federal Reserve created and distributed trillions of US dollars into the economy. Because of these huge sums of money created out of thin air any resource or collectible that is limited in supply and wanted by others will appreciate in value.

For example there will only ever be 21 million Bitcoin ever created. The new 6.25 Bitcoin that are currently rewarded are distributed fairly and transparently to anyone willing to secure the network. Here you can see the “Price of Bitcoin Over The Past Ten Years“. Bitcoin is in demand because of its limited supply and because it’s a form of money that is convenient to store and send to anyone over the internet.

You can also follow your interests and buy other limited edition or unique items that appreciate in value over time. Land, art and watches are just a few examples.

Something to avoid and not generally considered an asset is a big house. The bigger the house the bigger the expenses, especially when it is not rented. Commercial real estate such as office space, hotels or apartment complexes will generally be better investments and not dependent on a single tenant.

It’s also not ideal to keep large amounts of cash in bank accounts, because as governments around the world inject billions and trillions of their currency into the economy your money loses its purchasing power. It is still better to save than spend, but ideally you find good, quality assets to buy and surround yourself with people that will help you make good financial decisions. 

Unlike most jobs your largest earning potential is at the beginning of your career. You may feel rich now, but you have many years ahead of you that may not include professional athlete type income. You will undoubtedly also have more family and health related expenses when you retire. Save as much of your salary as possible so you can buy enough assets that will take care of you in retirement and give you enough time to plan your next move. 

If you are interested in Bitcoin you can check out the Bitcoin Course. You can also call or text if I can help with anything else.