A Common Pattern We See with Top-Earning Talent
C. 2 min read
If there’s one thing that’s near-universal when we look across the entertainment world, whether it’s artists, songwriters, athletes, or actors, it’s cash. And not just earnings, but the amount of cash that sits on the sidelines, doing nothing.
It’s not unusual for someone with a strong season behind them or a big deal just landed, to be sitting on large sums of cash. Advances, prize money, royalties, sponsorships... it builds up. Not necessarily with a plan, but with the assumption that cash is safe, and it’s there when needed.
For solo performers especially those in individual sports or running their own tours, there’s often no buffer of a salary, or contract to take care of the financial side. The mindset tends to be: cash is safe. And with so much unpredictability in their work, keeping things liquid feels like the smart move.
But here’s the reality:
Cash is going down in value every year.
Even with interest rates where they are today, cash rarely keeps pace with inflation. And over time, that erodes real value. Quietly. Relentlessly. A pile of money that looks impressive today buys meaningfully less in 5 or 10 years.
What we often find, once we map out a client’s real-world spending and commitments, is that a large portion of their cash isn’t actually needed for the next 12–24 months. That’s where the opportunity lies, and where good planning can pay dividends (pun intended) over time.
We tend to think about this in three steps:
1. Liquidity This is the true safety net. We usually recommend holding 12–24 months of spending in cash - especially for individuals in sports like golf or boxing, and performers like musicians, actors, and artists. That’s the buffer. It covers lifestyle, overheads, staff, and anything unexpected. It’s simple, clear, and essential.
2. Structure For those earning through a company, there’s often an added layer: how and where that cash is held. Corporate accounts can offer a tax-efficient way to invest. And for internationally mobile clients, choosing the right structure matters as it may not work across borders.
3. Security for the Future Beyond the liquidity and the structure, there’s often capital that won’t be needed for years. That’s the money that should be working. Invested thoughtfully, it can grow above inflation and create a meaningful pot, either for life after sport or music, or to support quieter years in between major events. This isn’t about chasing high returns. It’s about steady, intentional growth to support income later in life.
Careers in entertainment and sport can be unpredictable. What someone earns today might need to last a long time. The best plans we see don’t overcomplicate things, but they do make sure every pound or dollar has a job to do.
Estate Planning, Inheritance Tax Planning and Tax Planning are not regulated by the Financial Conduct Authority
The value of investments and the income from them, can go down as well as up, so you may get back less than you invest
Investment advice and investment advisory services offered and provided through Blacktower Financial Management US, LLC. This communication is for informational purposes only based on our understanding of current legislation and practices which are subject to change and are not intended to constitute, and should not be construed as, investment advice, tax advice, tax recommendations, investment recommendations or investment research. You should seek advice from a professional before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
