Hire an expert first
St-Pierre says he hired a financial adviser right away. This decision was partly because he’s a Canadian citizen, which complicated his tax situation fighting in the U.S.
“I made sure my structure was solid and all good,” he said.
Other famous athletes have found themslves in tax trouble in the past. For example, in 2019, Portuguese soccer star Cristiano Ronaldo paid an €18.8 million ($19.7 million) fine over tax evasion charges while playing for Real Madrid. Argentina soccer star Lionel Messi also paid a fine over tax issues while playing for Barcelona in 2017.
It isn’t just famous athletes who find themselves in trouble with tax authorities. In 2023, 14 million American taxpayers collectively paid $7 billion in penalties, according to The Wall Street Journal, citing Internal Revenue Service data.
Hiring a tax adviser or financial expert to assist you could help reduce the chances of tax trouble.
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Learn MoreHelp family and friends (within reason)
St-Pierre says he spent tens of thousands of dollars helping his family and friends. He paid off his parents’ debt, purchased reasonably priced cars for them and financed his sister’s master’s degree. He also says he “lost” $30,000 helping friends with their financial needs.
“The easy way to get out of financial problems is to borrow money from someone you know, take it, and never give it back,” he joked. “If you lend money to someone make sure you can afford to lose it.”
A survey by Bread Financial found 57% of respondents had borrowed money from friends in the past, while 30% of these borrowers said they never paid the friend back. Around 21% of survey respondents admitted they have lost a friendship over money.
With such grim statistics in mind, it makes sense to put guardrails on your lending to friends and family. Try to limit the amount you offer and assume that you may or may not see the money again. As St-Pierre says, never lend more than you can afford to lose.
Invest the majority
St-Pierre admits that some of his money was spent on frivolous luxuries, including $20,000 on a collection of dinosaur fossils. But before he went on his shopping spree, he ensured that much of his money was invested in bolstering future success.
He spent $200,000 to travel and learn new skills, such as Jiu Jitsu in Brazil, Muay Thai in Thailand and boxing in Los Angeles.
“It's hard to become champion, but it's even harder to stay champion because you become the target,” he says. “I spent a lot of money and I invested in myself.”
St-Pierre also invested in tangible assets, such as real estate. He says he purchased a condo for $500,000 and spent $100,000 renovating it. Combined with his training, about 80% of St-Pierre’s first $1 million in spending went toward investments that would pay off down the line.
The lesson is clear: invest in yourself and hard assets before you splurge.
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