Business of the Olympics

Pro athletes' top money tips for young Olympians

Michael McCarthy, Special to
Advice for young athlete-millionaires

San Francisco 49ers quarterback Colin Kaepernick has some blunt financial advice for young Olympic athletes coming into real money for the first time.

"Biggest thing is don't spend it. Don't spend it. Don't give it way," said Kaepernick at a Jaguar/Deadspin Super Bowl party in New York.

If only more athletes listened. Instead, sports are filled with cautionary tales of bankrupt athletes who blew millions on bad investments and bad advice.

Inexperienced young athletes enjoying their first contracts, or endorsement deals, can be easy marks. Crooked advisors offer "can't miss" deals. Family, friends and hangers-on have their hands out.

Hall of Fame quarterback Steve Young.
Leon Halip | Getty Images

During Super Bowl week, asked seven current and former NFL players, other pro athletes, coaches and team owners for their financial tips for Sochi Olympians such as new snowboarding gold medalists Sage Kotsenburg and Jamie Anderson.

Along with Kaepernick, they included wide receiver Victor Cruz of the New York Giants; Steve Young; the ex-49ers QB and NFL legend; IBF light-heavyweight champion and partner in Golden Boy Promotions Bernard Hopkins; kicker Jay Feely of the Arizona Cardinals; four-time Super Bowl coach Marv Levy; and Philadelphia Eagles owner Jeffrey Lurie.

Young, MVP of Super Bowl XXIX, also works as managing partner of HGGC, a Palo Alto, Calif.-based private equity firm. Feely worked as a financial advisor for two years. Here are their top seven tips for athletes to avoid going broke:

1) Don't spend it: The 26-year-old Kaepernick is one of the most popular young stars in the NFL. But he makes chump change compared with players like Peyton Manning.

(Read more: Empty seats frustrate at Sochi events)

Under his four-year rookie contract, Kaepernick only averages $1,281,071 a year versus $19,200,000 for Manning, according to Spotrac. Big portions of NFL player contracts are not guaranteed, so Kaepernick is probably smart to save until he hits the jackpot as an unrestricted free agent in 2015. Meanwhile, he's supplementing his income via an endorsement deal with Jaguar.

"For me, I don't spend anything unless I have to," said Kaepernick.

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2) Choose an advisor wisely: NFL owner Lurie borrowed an estimated $180 million to buy the Eagles in 1994. At $1.3 billion, the team now ranks as the league's seventh most valuable, according to Forbes. The single most important decision athletes make, according to Lurie, is hiring the person who handles their money.

"The best advice is to pick your financial managers, really, really carefully. ... It happens when you're very young. It's early. You have got to pick well," he warned at the third annual NFL Honors show at Radio City Music Hall.

3) Set a budget: Cruz, who helped the Giants win Super Bowl XLVI, said athletes have to set a budget/balance sheet with their financial advisor, then stay on it.

"Make sure you're not blowing all your money. Just go and put yourself on a per diem every week, every month, whatever it is, and treat your money wisely," he said at NFL Honors.

Based on his record-breaking 2012 season, Cruz signed a five-year contract extension with the Giants that will pay him an average of $8.6 million a year through 2018, according to Spotrac.

4) You're not Warren Buffett: Just because you're suddenly rich doesn't mean you're the Sage of Omaha, Young warned.

"There's always a sense, 'I want to be rich like the rich guys. What do they invest in?' Investments are really risky. You shouldn't do that until you get five years in, 10 years in, experience. People are trying to be experts in investing—right when they get rich. Forget that."

(Read more: Billions at stake in Olympic Games)

So what should athletes do with their earnings?

"No. 1, save it. AAA tax-free bonds would be the thing I would tell you," Young said.

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5) Trust but verify: The 49-year-old Hopkins fought promoters like Don King over purses throughout his career. Athletes have to "respect" money, he said. If they find one or two people who "earn" their financial trust, they're lucky.

"The word trust shouldn't be given to everybody. ... Make sure they have credibility to be trusted. Then you got a trusted and lifelong friend, forever," said Hopkins, during Saks Fifth Avenue's Super Bowl party.

6) Take advantage of free advice: Leagues such as the NFL offer rookies free financial seminars. They should take advantage, advised ex-Buffalo Bills coach Levy.

(Read more: Russian bilionaire disputes Sochi cost)

"I used to tell our guys, 'No matter what you earn, remember why you first played this game. It was fun,' " Levy said. "Keep it fun. But save something."

7) Plan ahead: Many young athletes don't start thinking about their future after sports until it's too late, Feely warned. Nothing lasts forever.

"The game doesn't, your money doesn't. I wouldn't try to live up to your means. Understand that you can have a level—and be comfortable at that level. Then you'll have money to last into your next career. Going into football, you have to understand it's a short window in your life. You're going to have a lot more life. So start planning ahead early."

—By CNBC's Michael McCarthy, follow him @MMcCarthyREV