Pro football player Rob Gronkowski did the unthinkable: He saved his entire NFL career earnings, lived off of endorsement money, and took his first retirement at 29 years old. Over his career, he's earned nearly $60 million from his NFL contracts according to Spotrac, and unlike many players, he's built himself a handsome nest egg for years to come.
Although Gronkowski, known by the nickname "Gronk," is a star football player who was blessed with million-dollar contracts, his savings strategy is so simple that anyone can mimic it to achieve their retirement goals. If you're a little low on retirement savings or just want to boost your portfolio, these tips will allow you to claim your retirement victory sooner than you think.
Image source: Getty Images.
The game plan
All great goals begin with a plan, and the first step you can take to crush your retirement goals is to start saving. Allocate as much of your earnings as you can to your savings accounts. Don't settle for only saving 10% to 20% of your earnings just because that's the standard path that everyone takes. If you can save more, go for it. If you can't save a lot now, then put yourself in a position where you can easily increase your savings rate one quarter at a time.
Gronk's winning strategy, though, didn't require complex formulas and calculations. "Keep it easy, and I'd say keep it simple," Gronkowski said in a 2019 Business Insider interview. "Get what you need to be comfortable, save the extra."
To save more, you typically have to increase your income or decrease your expenses. But if you're like Gronkowski, you can take on the challenge of doing both to expedite your progress.
In his 2015 book, It's Good to Be Gronk, Gronkowski shares the habits that helped him maintain a sizable nest egg. "Look, to this day, I still haven't touched one dime of my signing bonus money or NFL contract money," the former Patriots tight end wrote. "I live off my marketing money and haven't blown any big bucks on expensive cars, expensive jewelry or tattoos. Heck, I still wear my favorite pair of jeans from high school."
Tackle your goals like a pro
Gronkowski saved every dime of the money he received during his NFL career and only touched his endorsement earnings. He landed deals with popular brands such as Nike, Dunkin', Cheerios, Tide, and others that helped to fund his lifestyle.
But if you can't take advantage of all the glamorous endorsement deals that Gronkowski received, don't sweat it. There are perks that everyone can take advantage of at every income level to help them tackle their goals.
For example, once you start saving, you can use a portion of your funds to max out your Roth IRA every year to accumulate tax-free income during retirement. The key here is to invest the money in your retirement account to score big returns. The IRS will even give you a bonus -- the saver's credit -- for saving toward retirement, which can put up to $1,000 or $2,000 back in your pockets in 2021 if you earned a modest income.
For those who made too much money to contribute to a Roth IRA, then check out the traditional IRA. It's a tax-advantaged account that offers deductions that you can use immediately to reduce your taxable income. Don't forget to look into employer-sponsored retirement plans such as a 401(k) that can give you an additional boost to accelerate your savings goals.
If all else fails, at the bare minimum, you can always pick up a side gig or gain an extra stream of passive income that you can save exclusively for your retirement needs. Having multiple sources of income makes it easier to save.
The retirement touchdown
Gronkowski is not only winning on the football field, but he's tackling retirement savings one game at a time. His moves on the field prove this: There's always a winning move you can make no matter where you stand.
If you apply that same mentality to your retirement strategy, you'll be one step closer to scoring a touchdown in your savings. You may not wake up to millions of dollars overnight, but there's no doubt that Gronk's strategy will enable you to have a healthy nest egg to live the life you want now and in your senior years.
