Professional footballers are more risk-averse when it comes to their investments than people would believe, after having their fingers burnt during the credit crunch, said Adam Osper, head of sports and media at London & Capital.
Although known for splashing cash on extravagant lifestyles, footballers are more protective of their savings and generally opt for low-risk investments, he said.
“After the Lehman Brothers collapse, it became apparent lots of footballers had been misadvised on a number of racier investment schemes, such as property investments in some countries, and various things went wrong. We decided to re-open up our business to offer them plans aiming to allow them sufficient money to retire with.”
London & Capital previously had a sports wealth arm during the late 1980s, run in association with the Professional Footballers’ Association who later decided to bring the business in-house.
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The sports wealth management service was set up again two years ago and now has around 50 clients on its books ranging from Premiership and Championship footballers, rugby players, cricketers, boxers and members of the music industry.
Footballers who set up a pension pre-2006 are able to take retirement benefits from age 35 but changes in pension law saw the ‘protected lower retirement age’ for footballers and rugby players completely removed in April 2010, further supporting the need for sportsmen to have sufficient retirement plans in place.
“When they finish at 35, they need to have sufficient money to live on. We encourage them to save a multiple of their annual income on a monthly basis and use things like ISAs and bonds. If they are foreign players, we are able to structure some of these offshore,” Osper said.
Sam Sloma, associate director of the sports and media division at London & Capital, and a former Wimbledon player, said footballers are generally sensible with their savings pots with around 95% being risk averse.
“They have been enticed into complex investment schemes in the past and do not understand the risks. They want to keep things simple and low risk.
“They will happily spend their money on cars, jewellery and watches but they are risk averse about losing the money pot they have built up. We are trying to put this money away for the long-term and help them build it up in a conservative fashion.”
London & Capital is looking to expand on this side of the business by hiring someone to cover the Northern regions as well as extend into the US, where it already has an office, by adding soccer players to the client base.
It also wants to build further relationships with media clients and already works with a film production company and an accountancy firm with music ties.
“Being a global company, we are able to service clients even if they leave the UK,” added Osper.
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