5 Financial Tips for Student Athletes with NIL Deals
This blog provides a comprehensive guide for young athletes looking to navigate the world of Name, Image, and Likeness (NIL). It offers practical tips on contract review, budgeting, tax planning, time management, and financial education.
Imagine a young athlete stepping onto the field, not just to play a game, but also to manage their budding entrepreneurial ventures. This is the reality for many student-athletes in 2024, who are now allowed to monetize their brand under the Name, Image, and Likeness (NIL) concept.
In recent years, numerous talented individuals have seized this opportunity, becoming entrepreneurs while still in college or even high school. However, not everyone is dealing with a windfall like Arch Manning. Those earning modest amounts could be more susceptible to financial missteps.
To help these young stars navigate the world of NIL, here are five essential tips:
Review Contracts Carefully:
It’s understandable for a young athlete to be excited about any business deal that comes their way. However, it’s crucial to understand the contract before signing it. If you come across terms like “power of attorney,” consider consulting an attorney.
Budget Earnings to Last:
Once a deal goes through, it’s time to think about the future. Earnings can be sporadic and varied, so it’s important to create a budget and plan how to spend and save your money. Start by establishing an emergency fund and consider retirement savings if your income is sustainable.
Plan to Pay Taxes:
Unlike a regular job where taxes are typically withheld, you may be responsible for paying taxes in a NIL deal. Depending on your earnings, you might need to pay self-employment tax and make quarterly estimated tax payments.
Budget Your Time:
Being a social media influencer is a popular way for athletes to earn money from NIL. However, it can be more time-consuming than you think. Be prepared to invest time in planning, coordinating, and communicating for business posts.
Seek Education:
Financial education is crucial for young athletes navigating NIL. While school programs may not be fully equipped to handle NIL-related issues, there are resources available online and specialized platforms like AdvanceNIL.com.
Remember, the journey through the world of NIL can be exciting and rewarding, but it’s essential to stay informed and make smart decisions."
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