The head of business acquisition spoke to this publication about his firm's strategy when it comes to sports and wealth planning.
The world of sports has become a very lucrative sector within the UK and across the world. Millions have been pumped into sports. According to the Richest, current stars like Cristiano Ronaldo are worth around $375 million. With this amount of money at their disposal, sports stars need a helping hand, and wealth managers are starting to provide services to suit their planning requirements.
The head of business acquisition at wealth manager Sanlam UK, Andrew Lewis, has said that his firm are looking to aim its business at sports academies to reach out to the future stars of tomorrow.
“I think the financial sector has wanted to go after high net worth individuals, ultimately once the money has been made,” Lewis told this publication recently. “I think what it has missed is the academies, whether that is across football, rugby, cricket, cycling. Because in a very short period of time those people may walk into wealth in quite a significant way," he continued.
“We certainly hope that will be the case because there has been too much reliance on junior guys at clubs looking towards the senior players to see what they have done. But investing in property ten years ago is a different asset class to where it is now. The one thing with money and investing is trust. We are not going down obvious route one of the big earners, we are going down route two, to build sustainability and that covers of all sportspeople of all levels of earnings,” he said.
This publication interviewed former West Ham United midfielder Jack Collison to discuss wealth planning issues for sports figures. He said that there is dearth of educational classes for athletes to provide them with enough guidance to plan for the future.
Lewis, who joined the firm in 2013 as senior advisory stockbroker, says sports figures must be shown the sensible, risk-free side to investing, which can only be done by educating them.
“I think the differential is not necessarily striking but what we have always emphasised with the sportsmen and women, because its their first foray into investing, they are attracted to the bright lights of get rich quick,” said Lewis. “That is something they need to be steered away from. We try and put in place for them a foundation to investing and then we start building from that point onwards. We want to give them a solid foundation of investment and any yield or coupons from the portfolio can be invested in small proportions into high-risk areas if their appetite and profile does encourage that," he said.
“It is about education rather than sending them down the routes of the crypto-currencies, which they are attracted to the bright lights. They have got to realise that there can easily be a bubble that bursts and that can put them off investing for life. We try to encourage the sustainable route of investing. We have built this initiative based on the academies, so those in education or those just out of education. If we can input our financial education into the start of their careers, they can use us as a sounding board,” he said.
In early October, Sanlam UK signed an agreement to become the official wealth management partner of the Rugby Players’ Association.
Sanlam UK uses its partnership with the RPA to help members secure their financial futures, including offering a range of mentoring and work experience opportunities as well as providing specific seminars and workshops on savings and investment throughout the season.
Lewis spoke about the difference between a partnership and a sponsorship with a sports affiliation and about what the partnership can do for the members of the RPA.
“I think a partnership is different to a sponsorship,” said Lewis. “Having your name on a shirt or handing over a cup or sponsoring a game, that is pretty skin deep one dimensional. A partnership is about listening to the wants and needs of the members of the associations like the RPA. I mentioned about financial awareness and we are able to address that. We have client-centric as one of our focal points for Sanlam. Therefore we believe that if we can address the members needs and requirements within Rugby then that is actually activating a partnership. The RPA are a very well respected affinity and for Sanlam to be associated with them is great for us as a business. And for the RPA to have a well established client focused business in the form of Sanlam, that obviously is a partner that they would highly-regard as well," he added.