6 Common Money Mistakes Young Athletes Make and How to Avoid Them

Young athletes are often faced with unique financial challenges, and as a result, they may be prone to making certain money mistakes. Here are six common mistakes young athletes should watch out for, along with three action items for each point.

1. Not budgeting: Failing to budget effectively can lead to overspending and financial stress. To avoid this, young athletes should create a budget by listing all of their income and expenses, stick to the budget by avoiding unnecessary expenses, and regularly review the budget and make adjustments as needed.

2. Not saving enough: Young athletes may be tempted to spend all of their money on luxuries or unnecessary expenses, rather than saving some of it for the future. To avoid this, young athletes should set a savings goal and make a plan to reach it, automate their savings by setting up automatic transfers from their checking account to their savings account, and find ways to increase their income, such as taking on a part-time job or starting a small business.

3. Failing to plan for retirement: Many young athletes focus on the present and do not think about their financial future. To avoid this, young athletes should start planning for retirement as early as possible by speaking with a financial advisor, consider investing in a retirement savings account such as a 401(k) or IRA, and educate themselves on different retirement options such as pension, social security, and personal savings.

4. Falling for scams: Young athletes may be more susceptible to financial scams, as they may not have a lot of experience with financial matters. To avoid this, young athletes should be cautious when dealing with unfamiliar financial institutions or individuals, be wary of unsolicited phone calls, emails or text messages, and research the institution or individual before providing any personal or financial information.

5. Not protecting their income: Young athletes should consider getting insurance to protect their income from potential injury or illness. To avoid this mistake, young athletes should research different types of insurance such as disability insurance, health insurance, and life insurance, speak with a financial advisor or insurance agent to determine the best options for them, and review their insurance policies regularly and update them as needed.

6. Not seeking professional advice: Young athletes may not have a lot of experience with financial matters and may benefit from seeking professional financial advice. To avoid this mistake, young athletes should research and find a reputable financial advisor in their area, schedule a consultation to discuss their financial goals and plans, and consider working with a financial advisor on a regular basis to ensure that they are making smart financial decisions.

In conclusion, young athletes need to be aware of the financial challenges they may face and take proactive steps to avoid common money mistakes. By budgeting, saving, planning for retirement, protecting their income, being cautious about scams, and seeking professional advice, young athletes can set themselves up for a successful financial future.