Four NFL players have died this year, all of them just 24 years young. Sean Taylor is the most recent victim to be taken out of our world. How may a sports agent protect his client and the client’s family in case of the unfortunate circumstance of an early death?
Andy Zimmerman, a financial consultant specializing in estate planning and investments at PNC Investments in Cincinnati, Ohio sent me an email with some great commentary on the subject. The “you” he is referring to is me (Darren Heitner):
If managing the accounts as a Sports Agent, then it WILL be your responsibility to help these young athletes do proper financial and estate planning If you would like to invest into a great financial deal and some insurance then should check out Parts ABCD of Medicare Plans. You will have to advocate for their families and for themselves. How many of your peers are worried about planning, investing or saving? VERY FEW and that holds true for these guys throwing themselves around on the field or ball diamond, THEY’RE YOUR AGE [22] AND YOUNGER! Their biggest worry, as one guy told me is “bling, beer and _____(fill in the blank)”, not-to-mention looking great on the highlight reel. After all, they’re SUPERMEN, injury and death just happens to “other” people. They think they’re in primo-shape and invincible. So it’s on you to consider what they won’t.
Someone posted the rookie $150,000 policy (that covers the 2 cars in the garage of most of these players). Most financial planners will use a figure somewhere between 7 to 10 times one’s earnings (but also look at age, expenses and future earnings). Disability insurance is extremely expensive but worth every penny if you’re getting $50K per night that you pitch and you tear your rotator cuff. These guys have so few years to build a lifetime’s worth of earnings (which is why I have a problem with the NFL health benefits/pension for old timer’s; the abuse these guys bodies have taken is horrendous).
You will have to develop your contacts within the financial sphere: for tax, asset management, estate planning, divorce (as mentioned in a previous post). There are a lot of shoddy financial planners, trust depts, brokers, etc. Some may work at big-time firms or have their own; you’ll have to feel them out. Look for solid credentials CFP, CFA, CPA after their names before recommending and make sure they’ve got 10 years behind them (so that they survived 2000, 2001, and 2002 undulating financial markets)…don’t just recommend your buddy from the fraternity b/c he joined a firm that’s well known. The financial industry has over a 75% failure rate for first year hires. The NFLPA has done some filtering of advisors and made some hoops to jump through, but other player associations aren’t so choosy.
The reality is that most agents won’t take the proper steps to ensure financial security of their clients. NO one wakes up and says, “I think I’m going to do some estate planning today”; I’m sure Sean Taylor didn’t, and I don’t know how insistent Drew Rosenhaus is for his young clients to do so. But it still may be beneficial. Sure, nobody really wants to think about organizing their finances for after they’re gone but it can make you and your family feel more at ease that you’re leaving something behind that will go on to continue helping your loved ones long after. Therefore, considering something along the lines of a living trust Michigan really should be on the table and when you’re ready to speak with an estate planner, they will help you through all the details. I hope that you and the future sports agents that read your blog take on a greater degree of responsibility of either providing for or recommending that EACH of their clients sit down with someone to take care of financial responsibility they have for themselves and their family.
