The bankrupt athlete How to stay a Millennial millionaire

The bankrupt athlete How to stay a Millennial millionaireThe bankrupt athlete How to stay a Millennial millionaireIve spoken across the country on the steps outlined in my book, Millennial Millionaire- A Guide to Become a Millionaire by 30, educating hard-working young professionals how to squeeze mora out of their earnings en route to their goal. Im always enthralled by the enthusiasm, innovation, and attention to detail the most ambitious of Millennials take towards building their personal empire. However, the average starting salary for a 2018 college grad is $50,390. While this is certainly a respectable number, couple this with current costs of living and over $1.5 trillion of outstanding student loan debt (https//www.makelemonade.co/), and unfortunately many Millennials hit the million-dollar mark much later than expected, if at all.So where are Millennial millionaires produced almost automatically? Enter the sports arena. The average NBA player is 26.8 years-old with a salar y of $7.3 million, for the NFL its 26.6 years old and $2.1 million, and in Major League Baseball its 29.2 years old and $4.1 million. These astronomical figures only seem to get larger, shifting the conversation from becoming to staying. Its natural for the average Millennial to see the infamous images of Mike Tyson on ESPN Classic squandering over $300 million and react in disgust. How can the young, ultra-rich keep their wealth, or better yet, act like normal Millennial millionaire aspirant and grow it?Lets first take a look at how things usually go wrong. The poster child for riches-to-rags, Iron Mike, was known to buy mansions he never lived in and sports cars he never drove. Along the way of his spending spree, he racked up 38 arrests, seven children (some from marriages, some not), went through a couple costly divorces and worked with unscrupulous individuals like boxing promoter Don King.I cant even call them leeches. Thats too decent of a word to call them., Tyson said of Ki ng and other businessmen who ripped him off. This isnt the only example of extreme affluence disappearing, it just happens to be one of the largest sums in the quickest periods, showcasing every mistake in one case study.Despite countless cautionary tales, many athletes continue to make mistakes that not only cost money, but also a clean record. Id say there might be more kids out of wedlock than there are players in the NBA, one top agent said. Two obligations that cant be discharged from bankruptcy are child-beistand payments and taxes owed, another requirement often ignored by irresponsible athletes that can lead to jail time. These are stupid financial decisions, theyre plain stupid decisions.So, whats the solution? Easy marry the right person, pay your taxes, and then do nothing. Thats right, nothing. Take the average NBA career of 4.8 years multiplied by the average salary of $7.3 million, and the young basketball star earns $35.04 million. Take out the taxes you MUST pay and youre somewhere around $17 million in the bank (assuming an improbably high 50% effective rate). Earn a paltry 1% in a savings account on $10 million, because it cost $7 million to live a respectable lifestyle during that 5-year career, and youre set with a $100,000 annual passive income the rest of the way without touching your principle.Of course, there are many more solutions with far greater yields, see Magic Johnsons 125 Starbucks locations, take up Hollywood like Dwayne The Rock Johnson, lend your personenname to George Foreman Grills, or start a real estate company while still playing football like Roger Staubach. Football teaches you hard work. It takes a lot of unspectacular preparation to have spectacular results in both business and football, the former Navy quarterback said.Not looking to become an entrepreneur or get tripped up in your old high school pals genius investment idea, then its time to consider a financial plan. The financial plan may not be all that differe nt than the average Millennials we opened this article with, just hyper-funded in a condensed time frame. An easy to follow plan might include splitting up every $4 earned $1 to spend, $1 to bank for short-term goals/concerns, $1 to invest moderately in an accessible brokerage account, and $1 to stash away for normal retirement age. This is just an adaptation of the famous mantra- PAY YOURSELF FIRST. Its simple enough that the athlete afraid to discuss such matters with friends, family, or professionals can try starting it alone (not my recommendation, but better than blowing all $4 on your entourage).Obviously, taking it a step further with expert advice can help the situation. Athletes are accustomed to getting support from strength coaches, athletic trainers, team doctors, coaches, equipment managers, etc. so hiring a professional is nothing to be ashamed of. I always recommend consulting a Certified Financial Planner to ensure high quality and ethical advice. A more intricate p lan following the 4-step approach above might involve actively managed ETF portfolios, tax-advantaged vehicles such as Backdoor Roth IRAs or Whole Life Insurance, fixed annuities, and more.In closing, the young millionaire should be most concerned with the preservation of the wealth theyre so blessed with. The horror stories we see on TV should be a reminder that its more about preventing stupid mistakes than achieving amazing investments. I encourage high-profile athletes to embrace being a Millennial millionaire, not a Millennial billionaire.Bryan M. Kuderna is a Certified Financial Planner, Life Underwriter Training Council Fellow, and Investment Adviser Representative withKuderna Financial Team. He is also theauthorof the best-selling book, MILLENNIAL MILLIONAIRE A Guide to Become a Millionaire by 30.