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Calyn Bransford, a University of Notre Dame second-year student and aspiring basketball player will be glamorizing the court with her fake lashes during this upcoming season. Her job is to wear false lashes, and she wants to be able look great while hooping.
Bransford has a contract with Opulence Lash and makes money by promoting their products. This is possible because of a change in NCAA regulations governing college sportsmen. They can now earn money by using their NIL — name, likeness, and image.
In 2021, following a Supreme Court ruling that nullified restrictions on payments made to student-athletes by certain sponsors and organizations, the NCAA revised its NIL rules. Student-athletes can still not be paid for playing their sport, or attending a particular school. However, they are able to receive money from ad contracts, endorsements, and public appearances. The NIL earnings opportunities for student-athletes are determined by state laws, school rules and conference regulations.
Bransford and her parents reviewed the NIL regulations that applied to her before she went to college. Her parents now help her to manage her money. Bransford explains that she spends a percentage of her money, while the remainder is saved by her parents. It’s best to get someone older and more knowledgeable who understands taxes, bills, and other financial matters.
Many student-athletes do not have the same financial stability as Bransford. They need help managing their NIL income. This group of athletes can use NIL income to invest, pay for their education, and hire professionals. NIL money could provide athletes with a foundation of wealth through a sound financial strategy.
Take a look at a market
You can join an online marketplace to help you monetize the NIL. This is a platform which helps connect student athletes with businesses or people who are interested in working with them. Some marketplaces have a connection to a particular school and others don’t.
It’s not necessary to use a marketplace in order to monetize your NIL but working with one can help make it easier. Students-athletes are encouraged to report any NIL activities to their schools, who will then evaluate each deal for compliance with the state laws and school policies. The compliance department of colleges and universities will automatically handle NIL contracts, so students don’t need to send in paperwork.
Students should consider whether they can afford to pay the fees charged by some marketplaces. Justin Bass is the managing director of MAI Capital Management’s sports and entertainment division. He says, “Do your homework.” Are you receiving more value for your fee ?”?
NIL compensation does not affect athletic scholarships, but depending on the amount of NIL earnings a student-athlete may no longer qualify for need-based financial aid. NIL income does not affect athletic scholarships. However, depending on how much NIL money a student athlete earns, they may be ineligible for need-based aid.
If you have NIL income, it is important to talk with the financial aid office at your school to find out how this money affects their package. Adam Cocco is an assistant professor of Sport Administration at the University of Louisville. He says that if you receive $50,000 through NIL activities, it’s likely you will need to save a portion of this money to cover your tuition for next year.
Get Professional Help
It can seem impossible to manage NIL income and rules while also keeping up academics and athletics. Hire a financial adviser and make sure to thoroughly screen anyone you add to your team.
Lauryn William, a former University of Miami track and field star who was also an Olympian in 1996, turned professional when she signed a contract with Nike for $200,000 dollars. She described the amount as both “awesome” and “terrifying.”
Williams admits making mistakes in her finances, and she blames them on taking advice from others without experience dealing with large sums of cash. Williams, who retired from professional sport in order to help others with their finances as a college student aged 20, became a certified Financial Planner after retiring.
Williams recommends that you work with an enrolled agent or certified public accountant, who will help file your taxes. Students-athletes earning more than $400 must file. It can be difficult to calculate taxes, particularly for people who have income from different states.
Williams advises that you should hire a professional, even if the cost is high. This is an unusual earning scenario, so you do not want to ruin it .”
“Let money change your life”
A study by RBC Sports Professionals found that fewer than 2 percent of student athletes go pro. And even those who do tend to have a career in professional sports lasting only five or seven years. If sports is not a big part of your life, investing can be a great way to secure it. Cocco advises: “Let the compounding interest do all of the work, and watch how your future will look in 20, 30, 40 years.”
Student-athletes with a NIL-income can contribute to individual pension accounts (IRAs), and those who are self-employed have access to 401(k), IRAs for simplified employees, as well as solo IRAs. Financial advisors can assist you in choosing the right retirement account for your needs.
Williams also recommends that you invest in your financial education. Williams suggests that if your school does not offer personal finance courses, you can use NIL to purchase an online course.
She says, “With this money you have the option to either enjoy it or use it responsibly.” This is your chance to put yourself on the right track towards retirement .”
The Associated Press originally published this article, which was written by NerdWallet.