SerpApi.Org
Once the euphoria of Jannik Sinner’s Wimbledon title defence subsides, his mind must inevitably turn to what he will do with his £3.6m winnings.
For a 24-year-old who has endured two weeks of gruelling tennis in scorching temperatures, he may be forgiven for wanting to treat himself a little: a five-star getaway to the Maldives perhaps, or a luxury car.
Those under the watchful eye of Johnnie Hampel, however, might think twice about splashing out on such extravagances.
As wealth manager to some of Britain’s leading lights in tennis, golf and Formula One, Hampel says his job is essentially to “act as a policeman” to those with sky-high earning potential, yet relatively short careers.
While he does not stop his clients from enjoying their money, his role is to “temper their need for instant gratification” and encourage them to take a longer-term view.
“We try to help people understand that if you’ve got a short lifetime in terms of earning capacity, you’ve got a really long life to fund,” he says.
A former Goldman Sachs banker, Hampel is used to dealing with wealthy clients between the ages of 45 and 60, who are “generally more patient” when it comes to taking risks.
Because most have accumulated their wealth over decades, he says they can better appreciate the compounding effects of regular investments over time. Energetic young sports stars, however, need to be brought round to a more mature way of thinking. If not, they risk being left short in retirement.
“If you are a footballer or tennis star, and suddenly you are earning multiple millions at the age of 25 or even younger, it’s very difficult,” he says. “You feel indestructible – as though it’s going to carry on forever. You’re not really thinking about financial security.
“But if you’ve got a high-risk earning stream and a high-risk investment set-up, there are a lot of problems.”
As well as large pay packets at a young age, elite athletes face the challenge of fluctuating earnings experienced over the course of a career.
Victory at Wimbledon or the Masters can land winners seven-figure prize pots, but at the same time, missing a tournament through injury can blast a hole in expected income for the season.
This is compared with the average British worker, whose earnings tend to follow a steady incline until the age of 47, before gradually dropping off.
Hampel explains that each of his clients has a “stress case on earnings” that allows for peaks and troughs across several decades.
During peaks, it is about ensuring the money is not all spent at once and goes towards funding a stable life further down the line; troughs, on the other hand, involve being able to quickly adjust without any major upheavals.
Sometimes, Hampel says, “the answer may just be you’ve got to spend less”.
Stress cases are designed differently depending on the typical earnings arc of the sport, including the possibility of an extended career in media, coaching or entrepreneurship after retirement.
Golf, for example, has a much longer earning life than tennis, while Formula One drivers have a short lifetime but generally more affluent parents, according to Hampel. “So they’ve got fewer issues about whether their money is going to last or not.”
The timeline for reaching peak earnings also differs between sports. Those that rely more on athleticism, such as tennis and football, usually peak much earlier than golf or snooker, where income tends to grow with experience.
Hampel says that understanding when peak earnings are likely to arrive is key to funding an ideal lifestyle in retirement – something both elite sportspeople and those with more conventional jobs can benefit from.
Too often, people forget how much life expectancy has grown and therefore end up facing a shortfall. “It’s not just in sport. Your life is long and it’s got a lot longer. It’s the same whether you’re a 23-year-old or a 53-year-old – everyone has got to have a strategy.”
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That said, some sports have a better history of looking after the long-term financial wellbeing than others.
For instance, the PGA Tour has offered its golfers a retirement plan since 1983, whereby they receive deferred payouts for participating in tours once their playing days are over.
Footballers, on the other hand, have had less generous deals and tales of misguided investments leading to bankruptcy are all too common. Gordon Taylor, former chief of the Professional Footballers’ Association, estimated in 2013 that between 10-20pc of Premier League footballers were made bankrupt within five years of their last game.
John Barnes, the former Liverpool and England winger, once England’s highest-paid player on £10,000 a week, blamed ill-advised investments when he was declared bankrupt last year after racking up £1.5m in debts.
Ex-Aston Villa midfielder Lee Hendrie also cited misguided financial advice when he lost his entire fortune in 2012, having earned around £30,000 a week at the height of his playing career.
Hampel says financial education at sport clubs has improved since he started taking on clients in the sector, but that there is still work to do to protect young people who suddenly find themselves coming into a lot of money.
“It’s crucial to understand the importance of money – what it can do for you, and in some cases, that it can destroy people.”
An advantage sportspeople may have over ordinary folk, however, is their willingness to let data be their guide.
Y Tree, Hampel’s company, leans heavily on analytics to assess the performance, risks and costs of investments and plan financial strategies for clients accordingly. Similarly, golfers, tennis players and F1 drivers obsess over the minutiae in their game to improve their chances of winning.
“We rely so much on data. It just informs you to make better decisions. We don’t force people to switch strategies. We give them all the reasons why they might do it, with all the data to help them make that decision.
“Athletes love that. The F1 drivers, as you can imagine, are very data-driven,” Hampel adds.
Indeed, Sinner will inevitably have studied optimal serve placements, rally patterns and recurring stroke weaknesses in Alexander Zverev, his opponent in the Wimbledon final. But does that mean he can make his £3.6m – or estimated £1.6m after tax – last him a lifetime?
Yes, Hampel says, but only with a precise approach. Swinging wildly and praying, as so many Wimbledon hopefuls have discovered over the years, is only destined to end badly.
“Everyone has their day in the sun,” he says, “but with the right process, the right discipline, the right strategy, you can enjoy your money, get personal fulfilment and fund your life.”
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