Most professional athletes make plenty of money (see fyi below) when they’re on the field – but those salaries don’t always hold them over after retirement. That’s why Lenny Dykstra, former professional baseball player, has created the “Player’s Club” with the help of the investment advisors at UBS. Dykstra was on “Morning Call” with his own investment advisor, Rich Suttmeier of Rightside.com, to discuss his new venture.
The “Player’s Club” is essentially an investment vehicle - managed by UBS - with the goal of guaranteeing cash flow to athletes and their families post-retirement. To join the club, an athlete must make an initial investment of $250,000. There is no limit on a maximum investment and the idea is that players will have a guaranteed source of income for years after they retire. Members of the “Player’s Club” receive a monthly newsletter educating them about investment opportunities.
Dykstra is an avid investor of the contrarian kind. He actively trades options in volatile sectors, although his personal investment philosophy is not necessarily that of the “Player’s Club” – athletes are free to invest how they wish the help of Dykstra’s team of asset managers.
The bottom line for the “Player’s Club”? It can be hard for former athletes to give up those luxurious lifestyles after retirement – and sometimes, before they know it, the money’s all gone. But if they can learn to invest some of that money and guarantee a recurring cash flow – then they can continue to live prosperously into retirement.
FYI--as of 2005, pro sports salaries showed an average of $3.7 million in the NBA, about $2.5 million in MLB, around $1.8 million in the NHL and about $1.3 million in the NFL. Bigger stars made much more. Half of the players in the NFL made $589,000 or less. Half in MLB made $788,000 or less. In the NHL, half made $1.1 million or less, and in the NBA, half made $2.2 million or less.
NBA:.....$3.7 million (median = $2.2 million)
MLB:.....$2.5 million (median = $788,000)
NHL:.....$1.8 million (median = $1.1 million)
NFL:.....$1.3 million (median = $589,000)
(source: MLB, NHL, NFL, NBA and various Web sites)