By now, National Football League players are all snug in their roster spots and cashing their multi-zero checks every two weeks…
Not so fast. Rookies and veterans alike are smart to keep their focus on the field with one eye and their brains on their bank and investment accounts. As countless stories have been documented, including in a powerful ESPN 30-for-30 feature, NFL rookie salaries do not go as far as some football players think when they look wide-eyed at their first contracts and paychecks. There are agents and advisors to pay, and don’t forget about long-lost relatives and best friends from first grade who appear at pro athletes’ doors asking for “loans.”
Estate planning attorney, Eido Walny, whose clientele includes retired NFL players and other professional and Olympic athletes, says these averagely paid individuals are often left to manage their own money and as a result are vulnerable to bad advice, worse money decisions and financial ruin.
The average on-field career span for an NFL player is 3.5 years. Many will go broke soon after their last down. Why? Professional athletes often see money that they’ve never before earned, and extravagantly spend on luxuries that include homes and cars that require hefty monthly payments. What they don’t consider is that one injury can end their athletic careers. That means that what seemed to be an overflowing trough of cash, suddenly evaporates.
Few agents will help guide their clients toward reliable financial professionals, even though it benefits them to do so. Some players report that after they are severely injured and/or released from teams, they can’t even get their agents to return their calls.
Walny offers a checklist of how NFL players may avoid the trap of rags-to-riches-to-rags again:
• Don’t spend money that you don’t have. NFL paychecks for most won’t last the term of a 30-year mortgage on a multi-million dollar home.
• Establish a relationship with a direct contact at a bank. DO NOT become a bank to family and friends.
• Hire an educated financial advisor. This person should not be the athlete’s agent. Engage a financial expert who will help create a plan that provides for near and long-term needs.
• Entrust a credentialed accountant — not the guy who tells you there are ways to avoid taxes or pay pennies on the dollar. A knowledgeable accountant may help navigate tax traps that envelop athletes. TurboTax won’t help here.
• Protect your assets with the help of a certified estate planning attorney if you marry, divorce or get sued.
• Find a reputable insurance agent who may help soften the financial blow when the unexpected happens.
These tips, says Walny, may apply to anyone who is tempted to drop several thousand or millions of dollars after landing a big job. For NFL players, however, life can move faster than an enviable 40-yard dash time. Take time to research professionals and engage those who will best protect your long-term interests.
Disclaimer: PUBLISIDE works with Walny in a publicity capacity to share information with sports and financial media.
###