5 Things to Do When Turning Pro | Aaron Goldberg | PGA Players' Podcast
Enjoy PGA Players Podcast? Leave us a 5-star rating & review to help others like you discover the show!
Episode Summary
Becoming a professional golfer is an exciting time. A ton of hard work, dedication and sacrifice put you in the position to be able to turn pro. Until now, most of what you have had to focus on is ON the golf course. You are now becoming a business, and with that comes OFF the course demands and needs that can take time and focus away from your game.
Follow these 5 steps when turning pro to set yourself up for success. The key to maximizing your potential is to eliminate distractions and take advantage of every opportunity placed in front of you. These steps will put you in a position to do just that.
Episode Highlights
00:45 – Who is on your team?
1:53 – Taking care of your body
3:01 – What do you want from an agent?
4:04 – Why a wealth management team not a financial advisor
5:28 – Questions to ask a Wealth management team before you hire them
7:58 – Get a second bank account and credit card
8:49 – Should you set up an LLC
9:43 – Where are you going to get better? “Good players push each other”
12:06 – What happens if I get hurt?
14:01 – “The best investment that you can make is in yourself.”
Stay Connected
AWM Capital: IG | LinkedIn | Facebook | AWMCap.com
+ Read the Transcript
Aaron Goldberg (00:46): Hey, everyone. Welcome back to the PGA Players podcast. This is your host, Aaron Goldberg, certified financial planner and private wealth advisor at AWM capital. Today, we're going to talk about the five things that you need to do when you are turning pro. Chances are, if you're coming out of college, whether you're graduating or turning pro early, these are five things that you need to get in line as you're turning pro so that you can optimize playing and make sure that your focus is there as opposed to off the courts issues.
Aaron Goldberg (01:18): So, first thing we're going to look at is building out your team. You've played junior golf, you've played college golf, most likely, and all along the way, you've had somebody to help you run the show. In junior golf, it was probably your parents helping set up logistics, travel, hotel, what tournaments to play in, talking to your coaches, all those types of things, even recruiting sometimes.
Aaron Goldberg (01:45): So right now, and then in college, that's what your college coach is doing. But the best part about college is you literally just show up with your golf bag and your team equipment and your team gear and coach takes care of the rest. You don't have to worry about too much, pretty nice. Guess what? Now that you're turning pro, no one's going to do that for you. So you got to do that for yourself, or you have somebody on your team that's going to help do that for you. So we want to look at number one, you're going to have your coaches. You're going to have your swing coach, a mental coach, maybe a short game or putting coach. You have your coaches. You probably already have those. Those are going to be the same people you've been working with, but those are going to be part of your team.
Aaron Goldberg (02:28): Secondly, you probably are going to have a trainer or physical therapist. And whether you worked with one in college at the school or one outside of the university, it's a good idea to start working with one now. Hopefully you don't have any injuries right now and you're healthy, but that's the best time to start working with one, because that way you can prevent injuries. Speaking from experience, unfortunately, I had a back injury that ended my career. So I'm a little jaded on it, but I've seen too many come out of college and you start playing way more tournaments than you're used to. You start practicing more. You have nothing else, but golf. And you're traveling a lot more, which puts a lot of wear and tear on your body. And we want to make sure that we're taking care of it because at the end of the day, that's the most important thing is your body and how you can go out there and perform.
Aaron Goldberg (03:20): And if you're not keeping yourself in a position to play your best, that's going to affect your bottom line. So the rest of your team, though, is going to be more the business side of it. And that's number one, going to be your agent. You've probably started that process. If you're going to be turning pro after the college season this year, at least started talking to some of them. There's going to be a lot of good agents out there, but there's going to be the right one for you. And it's going to be specifically to what they offer and what their specialty is. They're going to help with things like logistics, putting together a schedule, getting new starts that may be super important to you, or may not be as important to you because you may be getting a lot of starts, no matter what, or you may not get any starts no matter what.
Aaron Goldberg (04:08): So that may or may not be important. They're going to help you put together a club deal. They hopefully might be able to put together some sort of corporate deal. I know they're getting harder and harder to get, especially coming out of college, but those are the types of things that your agent may help you do. But they're also going to help with some of the travel and some of the setup behind the scenes that they're not going to do everything for you like a college coach would, but they may help especially in the beginning with some of the logistical setup.
Aaron Goldberg (04:39): The second part of that business team is going to be your wealth management and accounting team. And this is really important. And a lot of players coming out of college think, well, I haven't made any money yet. Like, I don't need that. And I understand that, and you don't need probably just the prototypical financial advisor that's going to look at investments for you, but you do need a wealth management team and an accounting team. Hopefully, that's somebody that's all encompassed in one team because the goal obviously is to make money when you're playing and your wealth management team should be putting strategies together to keep as much of that money in your pocket and as little going to taxes as possible. So think about it more from the perspective of saving money on taxes and optimizing your financial structure. So that, again, the goal is for you to play your best. And if you need extra money for training coaches, travel to get to extra qualifiers or extra tournaments, we want to make sure that every dollar possible is there for you. And so that's what a wealth management team can do on the front end for you before maybe you jumped to the thought of, well, I don't have any money to invest.
Aaron Goldberg (05:52): That's down the line. We need to set up the foundation first. And that's what's so important when you're coming out of college to find a team that's really qualified to work with you. So when you are talking to some of these financial teams, there's some questions you want to ask them. Number one, why are they qualified to work with you as a professional golfer? Have they worked with athletes before? Are they certified financial planners or certified private wealth advisors? We really want to make sure that they're qualified to work with you and not just they like golf and think that they can do a good job. They might do a great job for mom and pop, but they probably aren't qualified to work with you as a professional athlete.
Aaron Goldberg (06:36): Second thing to ask them is, do you do tax planning and wealth management under the same roof and with the same team? If not, if it's separate, that's going to be really difficult, especially for your unique situation. The tax planning and full on wealth management planning is an everyday occurrence for us. There may not be something actionable every day, but there needs to be constant communication. And if it's two separate entities, if it's a financial team and they say, "Oh, no, but we will work with your CPA." That's great. But I guarantee... I can't guarantee anything, but I'm pretty confident in saying that they're probably not talking on a daily basis to make sure they're covering everything for you. Another question to ask them is what type of retirement plan should I be setting up? And you may think again, hey, I don't really care about retirement yet. That's not really something that I'm worried about, but think about it more on the perspective of tax savings.
Aaron Goldberg (07:37): If they say they're going to set up a SEP IRA for you, that's okay, but that's not the best way for you as an athlete with fluctuating income. You want somebody that's going to set up an individual 401k for you. So if that's their answer, an individual 401k, you're probably on the right track and they probably know what they're doing. So let's keep an eye on that.
Aaron Goldberg (07:57): The last thing that I would say is if they start pitching you investments and returns, I'd just run the other way. If that's their best foot forward, that's not someone you want to be working with from on a long-term basis in terms of maximizing your net worth and really optimizing your taxes and your financial structure. So hopefully, that gives you a few tools and questions to ask when talking to some of these financial teams when you're coming out of college. But I do think it's really important if you're going to be successful to have those teams in place so that you're not looking for them once you do start making money.
Aaron Goldberg (08:34): So moving on to the second thing that I'd be doing when you're turning pro is getting separate bank accounts and separate credit cards. Now that you're on your own, you should have your own bank account and your own credit card to pay for things. That's going to be at a bank. It's going to be with a credit card. That's going to be for your personal expenses. What you need to do is get a second bank account and a second credit card for all of your golf expenses. This is going to do two things. Number one, it's going to make the accounting and bookkeeping at the end of the year much easier. Not only to make it easier, but also to make sure that we don't miss out on any deductions, that you may be able to write off at the end of the year. Because again, we're trying to save taxes and keep as much money in your pocket as possible.
Aaron Goldberg (09:24): The second part is if you end up setting up an LLC, which that's going to be our next topic, it does something called... It prevents us from doing something called piercing the veil, which is a fancy term for saying that it keeps us from mixing assets between your personal assets and your business assets. And if you do that, then it could render the business the LLC, and the protection of it, useless. So we want to make sure that we keep those separate. The third thing that we're going to look at is an LLC, as I mentioned. Now, this is going to be very specific and unique to you. So we want to make sure that we are talking to our team. Again, wealth management agent, to see if this applies to you right away. Eventually, you're going to want an LLC. Do you need it right away?
Aaron Goldberg (10:15): That's where I can't say for sure, but it's definitely the question to be asked and something you need to look into. The fourth thing that we're going to do is, and this may sound pretty basic, but trust me, it's something that you really need to consider is where are we going to live? And it's more than just for taxes. At the end of the day, I care about taxes and we want to save as much money as possible, but what's going to make you the most money and what's going to maximize your net worth, is you playing your best golf. So where are you going to be able to get better? That's the number one most important thing to ask yourself. We want to be looking at where's my foundation, where's my support system, where are my coaches? Where's a good practice facility that I know I will have access to all the time when I'm not on the road?
Aaron Goldberg (11:09): Where's an easy place to travel out of? Some of the smaller towns, it's a little bit harder to travel, but these are all things that we need to weigh and not one is going to rule a place out, but we want to make sure that we're considering all these things. The other thing to consider is are there other players that are doing what I'm doing? Are there other pros that are either turning pro out of college, that are on Korn Ferry, on the PGA Tour that I can play with? Again, one thing that I overlooked when I was playing as a professional was this. I lived in San Diego at the time. I had all my coaches. I had a good support system and a great facility, but the problem was, I didn't really have anybody that was going through what I was going through.
Aaron Goldberg (11:53): I didn't really have anyone to play with. There were some good amateurs and that's fun, but at the same time, it's not pros. And you guys know the difference. So we want to make sure that we have some good players to play with because of that's where the cream rises to the top. The good players are going to push each other and we start to see... There's a reason why a lot of guys live in Jupiter. There's a reason why a lot of guys live in Scottsdale. There's a reason a lot of guys live in Dallas. It's because of all the things we've mentioned, but there's other good players there that they can play with all the time. So we want to make sure that we're thinking about that. This doesn't have to be a decision that as soon as you turn pro you move, but it's something that you may think about through the end of the year and maybe set up for next year.
Aaron Goldberg (12:38): Again, taxes should be a consideration there, but it's not the most important thing in my mind. The most important thing is where are you going to play your best golf? The last thing that we're... The number five thing that we're going to look at when we're turning pro, and this probably isn't something that would enter your mind, is disability insurance. Now it may not apply to you. You may not have access to it, but if you're an highly ranked enough amateur, the insurance companies will offer this to you. And it's something worth looking into because if you're not on Korn Ferry or the PGA Tour with at least full status on the Korn Ferry Tour, you don't have any disability insurance through the tour.
Aaron Goldberg (13:21): So if you get hurt and you're out for a number of months, you have nothing coming in. And a lot of your contracts or manufacturers, or even corporate deals are going to be dependent on how many starts you make. So if you miss a bunch of starts that year, and you don't get paid by your manufacturer or your corporate deals, how are you going to pay for your expenses?
Aaron Goldberg (13:42): This is something where, again, I'm not saying you definitely need to do it, but it's definitely something you should look into with your team is how much would it cost to get some disability insurance to cover some of your expenses if you were to get hurt for a long period of time? Again, I'm going to go back to a personal experience. I got hurt. I had no disability insurance, and I was on Korn Ferry Tour at the time, but I didn't have full status. So I didn't get any sort of insurance through the tour. So I was out of my own pocket, not only for all my medical bills, but for all my personal expenses, all my expenses that were still golf related, like facilities and trainers and all that. But I had nothing coming in. My deal with the the club company that I was with at the time was dependent on starts.
Aaron Goldberg (14:31): I wasn't playing, so I didn't get paid. So we want to make sure that we at least look at this because it can be pretty cheap in comparison to what we're offered in terms of a benefit. So it's definitely worth looking into. So again, the reason we talk about these things is my goal and our goal at AWM is to help athletes maximize the greatest amount of their human capital and human capital means your future earnings. So we want to make you the best golfer, the best baseball player, the best football player, whatever your sport is that you can be. And by maximizing your after-tax net worth, it gives you the best opportunity to do that by reinvesting in yourself. As you're starting out your career, the biggest and the best investment that you can make is in yourself. And we want to make sure that you're doing that.
Aaron Goldberg (15:29): So put together the right team, go through these steps. Hopefully this helps get you off on the right foot as you're turning pro, because it's an exciting time. It's a fun time. It can be a little bit of a deer in the headlights, but you guys are all really good. And it's crazy how good you young players are coming straight out of college now. So I expect to see some guys that are in college right now be winning on PGA Tour maybe even this year or next year. So looking forward to watching. If you have any questions, please feel free to reach out to us at thePGAplayerspodcast.com. And until next time, stay humble, stay hungry, and always be a pro.