A recent ruling by the U.S. Supreme Court has opened the door for amateur athletes to make money from their name, image, and likeness (NIL) for the first time. Athletes in both men’s and women’s sports have begun announcing deals in multiple arenas including creating NFT’s (non-fungible token), social media marketing, promoting local restaurant and gyms, and endorsing national brands. The financial opportunities will continue to grow as both companies and athletes navigate this new terrain. With these opportunities, however, comes a new responsibility for athletes that has not been part of the equation previously…”I can now make money, what should I do next?” The answer is to build a solid support system to help navigate your financial future. This starts with having a financial advisor as part of your team.
The burden of making big financial decisions is not something an athlete, or any person, should handle alone. A good advisor will be well-versed on most financial matters and can help the athlete navigate these tough decisions. In our opinion, the advisor should be independent—one that does not work for financial institution offering a limited menu of proprietary or brokered products and strategies—they can help the athlete find “best of breed” solutions no matter who provides them. Additionally, we believe that the advisor should be “fee only”—that’s a legal term that essentially means that the advisor does not accept commission on the products they recommend so they are objective and do not face obvious conflicts of interest in providing their advice. These items are of pivotal importance on the front end of an athlete’s earning career as building good habits (saving, controlling spending, investing, managing risks, planning for taxes, etc.) will propel them toward a better future. The advisor should collaborate with an athlete on these items and help them create a plan in conjunction with their goals to establish a strong financial foundation.
The truth is, not every athlete will become wealthy based on the NIL ruling alone. And, unfortunately, many that do may not invest in themselves with a long-term view in mind. Most athletes will have a second career after their athletic careers are completed. The ruling does, however, present a great opportunity to jump start an athlete’s financial future and open new network/career opportunities. Those that manage their money and opportunities wisely, will be in a better position to succeed. Having a good advisor to help along the way can make a big difference!
About Homrich Berg
Founded in 1989, Atlanta-based Homrich Berg is a national independent wealth management firm that provides fiduciary, fee-only investment management and financial planning services, serving as the leader of the financial team for our clients, including high-net-worth individuals, families, and not-for-profits. Homrich Berg manages over $10 billion for more than 2,000 family relationships nationwide.
Disclaimer: The content of this presentation represents the opinions of Homrich Berg regarding these educational topics and should not be interpreted as direct investment advice or marketing of HB services. Investing involves risks including loss of principal. This document does not constitute legal, tax accounting or investment advice. This discussion includes our opinions and forward-looking thoughts as of August, 2021 and is not a guarantee of future results.