Helping Pro Athletes Plan for 'Retirement' by 40

Broadly speaking, financial advisors are used to helping their clients plan for a retirement that will commence in one’s 60s or 70s and last well into their 80s or early 90s.

For Kristopher Martin, a vice president and wealth advisor at Element Point Family Office in Miami, these “normal” retirement numbers don’t reflect what his typical client will experience. That’s because Martin focuses on highly successful professional athletes.

As Martin recently told ThinkAdvisor, Element Pointe recently increased its client minimum from $10 million to $15 million, and the firm serves many clients with a net worth far north of the minimum. Given the size of their fortunes, Martin explains, clients in this range have a unique perspective on wealth, and they tend to have a set of goals that varies substantially even from the mass affluent.

This is true for successful entrepreneurs and inheritors of big family fortunes, Martin says, and even more so for people who achieve this amount of wealth at a young age through professional sports. Given the nature of the game, many of Martin’s clients have lifetime earning patterns that are heavily front-loaded, and it is typical for “retirement” to arrive as soon as one’s early 30s.

As Martin explains, serving highly successful professional athletes means balancing today’s lifestyle expectations with the potential for a 50- or even 60-year retirement. It also means serving as equal parts life coach and financial guru.

As explored in the Q&A dialog below, Martin’s clients may sit in a unique niche, but the lessons about planning and client service that he has learned along the way can help any advisor better prepare their clients for both the financial and behavior sides of retirement.

THINKADVISOR: Can you explain how you got into the niche of serving highly successful athletes? Did you always want to be an advisor to such clients?

Kristopher Martin: I definitely have one of those atypical paths into this industry.

I was born and raised here in Miami as the son of a single mom who immigrated from Jamaica, and I followed in her footsteps and went to the University of Miami. Originally, I thought I would study engineering, but I quickly realized that was not the right path for me.

I ended up majoring in business and minoring in music, so from early on I had this connection to the world of events and entertainment. During the summers, for example, I would work internships in New York that eventually led me, after graduation, to get a job working for the concert promotion company Live Nation.

Over seven years there I worked my way up to being one of the booking managers for the state of Florida, which gave me great experience negotiating with booking agents in the theaters and clubs division. It was primarily events with 5,000 seats and below, which meant I was working with a lot of successful but still up-and-coming artists.

As I spent more and more time with the entertainers and everyone surrounding them, I just saw so much there — the good, the bad and the ugly, especially on the financial management side.

That’s what really sparked my interest in this whole world of financial advice for these young, successful people. So, I started interviewing at banking and brokerage firms, and eventually a mentor of mine connected me with David Savir here at Element Pointe, and I realized how the independent RIA space is where I am meant to be.

We had a great connection from the start, and I was actually the first advisor hire after David left J.P. Morgan to start this firm.

What are some of the defining features of your client niche? I assume many of them enter ‘retirement’ much earlier than the typical wealth management client?  

Yes, so with the high minimum that we have, we are generally going to be working with those second-contract or third-contract athletes, so they really have been successful in their world.

As you would expect, a lot of my clients’ earnings potential is maximized in the first third of their lifetime. Hopefully we see them play well into their 30s, depending on the sport. With football and the NFL, as you can imagine, retirements tend to come a little earlier compared with baseball or basketball.

Beyond that, however, this client niche is very diverse in terms of how people understand and view their wealth. So our approach is to really build an individual’s plan around lifestyle questions and their long-term life goals.

We also have a lot of really personal discussions that go beyond wealth. Many of our clients are people who are really identified by their participation in their sport right now, but these are people with big life goals and identities outside of their sport.

As a fee-based RIA, we have the space to get to know them and make sure we are the right fit, rather than just focusing on investments and portfolios.