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Choosing The Right Team Is Crucial To Managing Finances For Athletes
Education in schools on real life would help
Starting your first full-time job after college requires every young adult to make choices about their finances, many affecting their future.
The rookies beginning training camp in the NFL are no different except that some like Jameis Winston and Marcus Mariota have millions of dollars to manage – and potentially to squander.
Laura Zwicker, a partner at Greenberg Glusker which advises high net-worth individuals, believes the league could be doing more to help its players establish a strong financial foothold. “You could look at it that the NFL is just the employer and is doing enough by offering them high-paying jobs. But on the other hand there should be more education into the process,” she said. Three years ago, the NFL began offering players a financial wellness program.
“While some players are able to perform for a very long time and, with planning, amass significant wealth, most will have … left with exceptionally nothing to fall back on,” Zwicker explained.
Zwicker advises her clients to form a team of qualified people – not their friends – to set up an investment and retirement plan, a backup if the NFL doesn’t work out. A Sports Illustrated study found that 78 percent of ex-NFL players are bankrupt or nearly there just two years after their careers are over.
An accountant and investment advisor are the most important elements of the team, according to Zwicker, with a business manager and a lawyer also possible. “A lot of players don’t know how to hire an attorney or investment advisor or what questions to ask them,” she said.
In the defense of athletes, most 22-year-olds who come into a lot of money wouldn’t know what to do with it, Zwicker acknowledges. It’s a product of an education system where we value algebra more than real-life skills such as opening a bank account, filing your income taxes and buying a house. The latter aren’t taught in most high schools around the country. It has “nothing to do with parents” objecting to it, in Zwicker’s view, but more about the curriculum choices made by most school districts.
So, while an NFL quarterback may not need to know square roots to throw effective square routes, he does need to understand how to manage his finances.