“Regulation Best Interest” is here....but for whose Best Interest?


“Regulation Best Interest” is here....but for whose Best Interest?

The S.E.C. has adopted new rules for brokers and financial advisors with the intent of more protection and transparency for the individual investor. A well-intentioned endeavor that hopefully will result in its intended goals, although it certainly won’t be a straightforward path to get there. Just one of the new rules is explained in over 770 pages.

            The legal teams will gather to interpret; the consultants will study the business lines and decide how to implement the interpretations; compliance departments will adopt new policies to govern the interpretations; human resource departments will train brokers and financial advisors on the new rules and various internal and external regulatory bodies will ensure the rules are being followed. The impact on the private investor will not be apparent for quite a while and likely a few market cycles.

            For those investors who don’t have time to make monitoring their advisors and investments their full-time job, an expert, unbiased specialist with the foremost technology for daily monitoring is absolutely necessary.


What journalists are saying:

 “SEC Brings Increased Confusion For Investors With New 'Best Interest' Rule”

Jamie Hopkins

Director of Retirement Research at Carson Wealth

Forbes. com

“7 Key Takeaways from the SEC Rule

1.              Brokers required to adhere to a soft ‘best interest’ standard 

2.              Sets up DOL to synchronize rule-making later this year

3.              Big win for brokers and large financial services 

4.              CRS form likely to add to client confusion in deciding on   broker v. fiduciary advisor

5.              More focused on protecting brokerage role than consumer 

6.              Rule lacks enforcement and teeth to hold brokers to standard

7.              Final rule still missing clear guidance on what is best interest or incidental advice”


“SEC adopts rule to protect ordinary investors, but critics say it’s too lax”


PUBLISHED WED, JUN 5 2019  12:20 PM EDTUPDATED WED, JUN 5 2019  1:44 PM ED







“SEC reforms impose new requirements on brokers and advisers, but some argue not enough

New rules stress disclosure of conflicts, but fall short of creating a uniform fiduciary standard.”

Investment News

Jun 5, 2019 @ 2:51 pm

By Jeff Benjamin  



“It’s Official! SEC Pushes Through with Regulation Best Interest Standard for Broker-Dealers”

By Rita Raagas De Ramos June 5, 2019 

Financial Advisor IQ



“S.E.C. Adopts New Broker Rules That Consumer Advocates Say Are Toothless”





The NCAA fraud & corruption case: The “Adults” set the teenagers up for failure


The NCAA fraud & corruption case: The “Adults” set the teenagers up for failure

The NCAA fraud & corruption case: The “Adults” set the teenagers up for failure

Brian Bowen II was removed from practices at Louisville when the charges came out. He transferred to South Carolina but was not permitted to play, and then entered the N.B.A draft before withdrawing to play for a professional team in Australia.”[1]


      The guilty verdicts handed down today in the NCAA fraud and corruption case will cause some reverberations and may bring to light some schools and staff that hadn’t been mentioned before.



The convictions of Gatto, Code and Dawkins could motivate the other basketball corruption defendants to quickly negotiate plea deals with prosecutors in advance of their trials.


Any plea deal would require these defendants to not only plead guilty but also (1) share any electronic records and other evidence that could implicate other figures in basketball (including potentially head coaches) and (2) testify against others. As a result, it’s possible that additional persons in the basketball industry could be charged with crimes.”[2]

         Anyone in the “basketball industry” who has participated in illicit practices will undoubtedly be losing some sleep while the rest of this plays out. It’s too late for anyone to rewind the clock and reverse misdeeds or worse, try to cover them up. The focus needs to shift to identifying incremental and practical changes that can be easily implemented to improve practices going forward.

         The true victims of this exposure of illegal practices within the basketball industry are the student-athletes.

         For example, Munish Sood a financial advisor from NJ, “pleaded guilty to felony conspiracy to commit bribery, honest services fraud and travel act offenses; payments of bribes to an agent of a federally funded organization; and wire fraud conspiracy.”[3] During trial testimony, there were examples of elite high school athletes and collegiate athletes whose careers were hijacked because of Sood’s actions.

“Munish Sood, a money manager who was initially charged before reaching an agreement with the government, testified that he was in on the plan. Bowen’s father, Brian Bowen Sr., confirmed much of the allegations in his own testimony, though he said that his son never knew about the deal, or the thousands of dollars he received from other sources related to where his son plied his ample talents.

Brian Bowen II was removed from practices at Louisville when the charges came out. He transferred to South Carolina but was not permitted to play, and then entered the N.B.A draft before withdrawing to play for a professional team in Australia.”[4]

         There’s no way to know how many advisors who haven’t been caught are still using illegal and unethical practices to get to student-athletes.      

       Sood’s former business partner, Marty Blazer, who has been barred from the brokerage industry, ordered by the SEC to pay fines related to a Ponzi scheme he used to defraud professional athletes (unrelated to the NCAA case) and is awaiting sentencing, paid coaches from several schools including:

“Blazer found another willing conspirator in former Oklahoma State associate head coach Lamont Evans, according to court documents. Blazer's payments to Evans began in April 2016, around the same time Evans left South Carolina for Oklahoma State, according to documents. The payments continued for several months and, in the end, totaled $22,000 -- plus two pair of $300 headphones Evans specifically requested.”

“Once, in introducing Blazer to a player, the coach made it seem as though he and Blazer had been good friends. Evans, according to court documents, told the player that meeting Blazer is ‘going to benefit you ... You just stay the course, play the game and you'll be fine.’ As soon as the player left, Blazer gave Evans $2,000.”

       With the NBA G-league implementing the “Professional Path” program that will pay $125,000 to high school graduates who choose to enter the NBA developmental league instead of college, there’s now a baseline value to establish a market. Players could enter the NBA G-league with the intent of saving money to eventually go to college someday. They could compare that value proposition with the value of attending college for one year at a school that will honor their scholarship in perpetuity and pay for their ultimate return to college.

         Regardless of how the remaining trials or plea deals unfold, it’s clear that universities need to change recruiting practices. If a player and his family want immediate access to money and education is a secondary priority, chances are they’ll opt for the $125,000 legitimate salary rather than take the risk of becoming ensnared in a potentially career-ruining legal battle.

         Collegiate athletic programs need to accept the reality that they’re likely not going to be able to compete with the market-establishing, above the table $125,000. Resources and investments into programs that will give life tools to the student athlete in preparation for a pre-graduation departure will be much more compelling to the athletes and families that prioritize a foundational level of college education. Those athletes and families will care about Financial Literacy and Financial Advisor Due Diligence to help prevent losing money once it’s earned.

         Without financial education and training, the first tool to screen financial advisors is typically a recommendation from someone the student-athlete trusts. If that trusted individual is someone who is giving recommendations based on who is bribing them, the student-athletes are set up to fail. An advisor who uses bribery as a way of developing business isn’t likely to conduct ongoing business with clients in an ethical manner.



[1] NY Times, October 24, 2018, “Three Found Guilty in NCAA Basketball Recruiting Scheme” by, Marc Tracy

[2] SI.com, October 24, 2018, “Why the Prosecution Won in the College Hoops Corruption Trial and What’s Next” by, Michael McCann

[3] ESPN, August 31, 2018: “Munish Sood expected to testify in NCAA hoops case as part of plea” by: Mark Schlabach

[4] NY Times, October 24, 2018, “Three Found Guilty in NCAA Basketball Recruiting Scheme” by, Marc Tracy


Have you done proper due diligence on your financial advisors?


Have you done proper due diligence on your financial advisors?

"His background as a Harvard graduate and an employee of Goldman Sachs gave me a false sense of confidence."

From CBS Sports:

Browns LB Mychal Kendricks admits to federal charges of insider trading

U.S. attorney Bill McSwain announced Kendricks had made illegal investments while playing in the NFL

Cleveland Browns linebacker Mychal Kendricks may have ruffled some feathers in Philadelphia this week when his latest comments on HBO's "Hard Knocks" highlighted perceived weaknesses in some of his former Eagles teammates.

But Kendricks appears to have much bigger concerns now.

Less than 24 hours after his appearance on "Hard Knocks," the Super Bowl LII champion has been charged by federal authorities with insider trading, as U.S. attorney William McSwain announced in Center City, Philadelphia, on Wednesday. Tied to illegal investments he made in 2014, when he was still playing for the Eagles, the charges are likely to precede a guilty plea by the linebacker, as The Philadelphia Inquirer's Jeremy Roebuck reported.

TV writer and former Goldman Sachs analyst Damilare Sonoiki was "brazenly passing along insider information," including heads-ups on stock mergers and acquisitions, to Kendricks from 2013 to 2015," Roebuck reported via Twitter. In exchange for the inside information, Kendricks allegedly provided $10,000 in cash and Eagles tickets to Sonoiki.

Kendricks himself has already admitted to wrongdoing, releasing a statement via his attorney:

I apologize. Four years ago, I participated in insider trading, and I deeply regret it. I invested money with a former friend of mine who I thought I could trust and who I greatly admired. His background as a Harvard graduate and an employee of Goldman Sachs gave me a false sense of confidence. To that point, I had worked my tail off since I was 5 years old to become the football player that I am today. I was drawn in by the allure of being more than just a football player. While I didn't fully understand all of the details of the illegal trades, I knew it was wrong, and I wholeheartedly regret my actions.

Since the beginning of the investigation, I have fully cooperated with all of the authorities and will continue to do so. I accept full responsibility for my actions. Although I did not take any of the profits for myself, I am committed to repaying all of the funds gained illegally and accept the consequences of my actions.

I sincerely apologize to my coaches, the owners, and my teammates on the Eagles and the Browns, the NFL, and the magnificent fans to whom I owe my career. I also apologize to my family, who I have failed in this. You all deserve better, and I will work my hardest to re-earn your trust and respect, serve as an advocate to educate others, and show you that I will never be involved in anything like this again. Thank you for your time and hopefully your forgiveness.

Kendricks' charges fall in "uncharted waters" for the NFLaccording to Fox Sports' Jay Glazer, who suggested Wednesday that the veteran's violations "could fall under" the league's personal conduct policy.

The Browns, meanwhile, who signed Kendricks in June, have released a statement of their own, saying they "are in communication with the league office" and that "Mychal will not make the trip to Detroit" for the Browns' final preseason game this week.



Professional Athletes: A Road Map to Financial Wellness


Professional Athletes: A Road Map to Financial Wellness

Financial Wellness for Professional Athletes:  A Roadmap

by Courtney Altemus



The horror stories of the athletes that earn and lose $10’s or $100’s of millions are aplenty and new stories are being reported all the time. The causes for these sad tales are varied and may or may not include the awful element of an unethical or fraudulent advisor. While every situation is different, there are factors and considerations that transcend all and they need to be addressed throughout an athlete’s career in order to prevent financial disasters and build financial foundations that will support them throughout and beyond their competing days.

In the following paper, we define these common factors for all professional athletes and we offer a practical roadmap that if followed, will help eliminate financial distractions. Each of the strategies in the roadmap are relatable for athletes as they deploy the same thought processes used in competitive sports and apply them to financial decisions. Financial wellness is a critical component of overall wellness. If an athlete is financially unwell, it will negatively impact all other areas of life and reverse progress of mental and physical training.

It’s True: Professional Athletic Careers ARE Different

Career Differential Stats

Regardless of the size or terms of any professional athletic playing contract, athletes’ careers are very unique relative to all other professions. This uniqueness needs to be a driving consideration in investment advisory decisions. The following facts are some of the major differentiators that need to be central to defining any athlete’s risk profile:

  • Career length: 3-6 years vs. average college graduate career 42 years*

  • Earnings rate: Higher than average college graduate, i.e.,  6-year (median) NFL career earnings are more than lifetime earnings of average college graduate**

  • Peak earnings: Reverse order vs. average college graduate, most will never earn more than that of their playing careers

  • Injury rate: 20%

  • Career earnings profile: Short burst, random ending

 There is no universal optimized budgeting and investment program to account for these differences for pro athletes as a group. These data points are major factors that will impact risk profiles and investing time horizons and they must be considered by the athlete investor and his/her financial advisor prior to making any investment decisions.

*National Bureau of Labor Statistics (CES data, October 2017)

**Kyle Carlson, Joshua Kim, Annamaria Lusardi, Colin F. Camerer, Bankruptcy Rates Among NFL Players with Short-lived Income Spikes, (National Bureau of Economic Research, Working Paper 21085, April 2015,p 2)

Length of Career and Total Earnings Uncorrelated to Bankruptcy Risk*

This finding is counter-intuitive to all principles of budgeting and saving. It is also counter to the economic life cycle hypothesis which predicts that people smooth consumption over time by saving when income is high so they can provide when income is low. While the data sources for the finding are from NFL players only, we know from all of the pro-athlete financial horror stories, this happens in other sports as well.

“Players with longer careers have much greater earnings and opportunity to save for retirement, yet their bankruptcy hazard during retirement is no lower than those with shorter careers and lower earnings.”

Another significant finding from the research is active players don’t file bankruptcy. However, after two years post-retirement bankruptcy rates spike. The preparation for post-playing career needs to start before an athlete’s rookie season.

*Kyle Carlson, Joshua Kim, Annamaria Lusardi, Colin F. Camerer, Bankruptcy Rates Among NFL Players with Short-lived Income Spikes, (National Bureau of Economic Research, Working Paper 21085, April 2015,p 2)

First: Forget about the Money

Personality and Behavior

While there has been no research study that has identified exact behavioral patterns and personality traits present in every elite athlete, there is enough data that point to high incidence of certain behaviors that they should be considered when making financial decisions.

Well before any dollar amounts are discussed, athletes and their advisors need to discuss behavioral patterns that have driven their success in their sport and how the patterns may influence thought process in financial decision-making.

Several studies show elite athletes have high levels of Confidence, strong Internal Drive/Achievement Motivation, Freedom from Worry and more Comfort with Risk. Athlete investors’ behaviors that drive their success in sport could be detrimental to achieving and maintaining financial wellness.

 For example, some behavioral scientists categorize people according to the Self Regulation Theory which describes people as either prevention-focused (do not want to fail, don’t necessarily play to win, more often play to not lose) or promotion-focused (play to win, higher likelihood they’ll take chances and grab opportunities). A figure skater who will lose points for mistakes may perform with a more prevention-focused mindset than a soccer player who needs to score points to win and therefore might play with a more promotion-focused mindset.

“Athletes in general have higher chronic promotion focus than preventative focus.” “ ‘The prevalent view in sports is good motivational orientation’ is needed for success.” *

“Compared to prevention-focused individuals, promotion-focused individuals tend to be more willing to accept new options and courses of action, more willing to take investment risks and more likely to rely on emotions and existing biases.” *

“Prevention-focused individuals tend to prefer status quo options and make investments that are more conservative and are more disbelieving of manipulative persuasion attempts (Kirmani and Zhu 2007). “ *

*Joseph P. Forgas, Roy F. Baumeister, Dianne M. Tice, Psychology of Self-Regulation: Cognitive, Affective and Motivational Processes (Taylor & Francis, Feb. 25, 2011)

Brain Development

Numerous studies have shown that human brains don’t have a fully developed pre-frontal cortex until age 25. This is extremely important as it relates to financial decisions being made by athletes under the age of 25 AND this makes it imperative that  athletes start learning to weigh risk/reward outcomes well before age 25.

An undeveloped pre-frontal cortex means that risk management (“ability to assess risky situations and determine whether they will result in long-term benefit.” “the ability to turn down immediate gratification for long-term rewards.”), impulse control ( “ability to maintain self-discipline and avoid impulsive behaviors…”), logical thinking (behavior and decisions based off logic versus emotions), are not fully formed.*

A high percentage of professional athletes are under the age of 25:

  • 20% PGA players in top 10 world rankings under 25 in 2018 (Official rankings 6/18)

  • Approx. 22% of MLB players under age 25 in 2014 (Andrew Powell-Morse, Unofficial MLB Players Census, 5/14)

  • Approx. 40% NFL players under age 25 in 2016  (Michael Gertz, Pro Football Logic NFL Census 2016)

  • Approx. 40% of NBA players under age 25 in 2014 (Myel Kovar, Unofficial NBA Players Census, 5/14)

  • 100% LPGA Major event winners under 25 in 2016, with age range of 18-23  (Official LPGA)

Even the most well-educated professional athletes under the age of 25 don’t physically have full brain capabilities that are required for prudent financial decision-making. They need financial advisors who are coaching them on the fundamental processes of risk/reward analysis, asset allocation, assessing financial goals, etc.

*Erin Brodwin & Sky Gould, The Age Your Brain Matures at Everything--it isn’t even fully developed until age 25,( Business Insider, 11/17)

Next: Start Talking about Money,  Athlete and Financial Advisor Must Start on Common Ground


Risk/reward assessment is constant In athletes’ lives in their sport but they typically don’t think of it in these terms. Their success depends on their abilities to read opponents (teams, individuals, innate objects), make immediate decisions and execute past their opponents to achieve their goal. This constant assessment process is used to make split-second decisions.

The critical discussion and assessment of an athlete investor’s risk tolerance and risk profile should be the same thought process they employ when competing, just using different end goals and factors. Relating the fundamental analysis necessary for prudent investing to an athlete’s natural thought process joins athlete and advisor at the same starting point. It allows the athlete to begin to trust his/her own knowledge at the start of a financial decision-making process rather than presenting an overwhelming new concept that takes time to learn and conquer.

After establishing this common starting point, the framework of a budgeting and investment plan can begin. Athletes should learn that while competing, they’re risking the most important thing in their lives; their bodies. They’re putting their bodies through rigorous and repeated conditioning exercises to prepare for winning. This factor should be the foundation for the financial  decision-making process. Compensation from this ultimate risk should be protected, sustained and managed with great vigilance and discipline.

Athletes need an advisor who coaches them to separate the risk/reward analysis they perform everyday in their sport from the risk/reward analysis they apply to their investment decisions. While it is the same thought process, the factors and goals for outcomes are radically different.

No such thing as Achieving the Highest Reward while taking no Risk

The line in the graph below represents a series of optimized portfolios. Using historical market return and risk data, each point along the line reflects the intersection of expected return for each level of risk an investor is taking. Investment decision-making discussions should start on a point on that line that represents an individual’s risk tolerance.

While it’s tempting to find a portfolio that will defy historical returns over time and achieve a point of the graph in the top left quadrant, such a portfolio doesn’t exist. Just as the calculations are based on many years of historical data, an investor’s time horizon for funds in these portfolios must be long-term. It’s a very different risk/reward proposition than what is used during competition. Outcomes for long-term investments take years to be determined vs. outcomes in sports which take seconds (or less than seconds), minutes or hours.


Screen Shot 2018-06-02 at 11.18.52 PM.png

Asset Allocation

This personal financial game plan is critical to achieve investment goals. It needs to be adjusted on a regular basis in order to be effective and ultimately drive long-term performance. Only after careful consideration of behavioral tendencies, risk profile and short and long-term goals can the advisor and athlete investor begin to apply those findings to the search for an optimal portfolio.

The optimal portfolio will be structured with enough diversification among asset classes to minimize volatility and provide more steady returns over time. As asset classes overperform and/or underperform, the asset allocation will need adjustments. These adjustments also must account for the investor’s life circumstances,income changes and tax implications. It is imperative for an athlete investor to work with an advisor who is vigilantly monitoring the portfolio relative to the asset allocation and notifying the client when adjustments are necessary. A static asset allocation can be detrimental to long-term performance of a portfolio. (see chart below)

Without a functioning asset allocation, the athlete investor can be tempted to deploy some of those behavioral characteristics (comfort with risk, confidence, impulsivity) that are helpful in their sport but not best used for investment decisions. This does not mean that an athlete investor should never decide to allocate money to a high-risk investment. However funds for those investments need to be set aside, away from the majority of their assets which are invested in their closely monitored portfolio. That high-risk money should be less than 5% of their overall  portfolio and an amount that the athlete investor is comfortable losing. Additionally, a high risk investment should be carefully vetted with experienced professionals.

Screen Shot 2018-06-03 at 5.20.36 PM.png

Strategize. Innovate. Execute.

Most areas of life are a continuous cycle of making plans (Strategizing), adjusting and reworking plans (Innovating) and carrying out plans (Executing). Athletes are constantly making game plans, quickly adjusting during competition and executing each iteration.

Living a financially healthy life in order to minimize financial distractions requires the exact same cycle. Whether determining a budget or an investment plan and asset allocation, the Strategize. Innovate. Execute. process is the same. Too often financial professionals aren’t able to relate financial fundamentals to athlete investors and the process becomes an overwhelming new challenge to learn and overcome.

Financial wellness is important in everyone’s life but especially an athlete’s life. The athlete’s training is a continual physically and mentally grueling process that fuels peak performance during competition. Distractions from this training can slow progress and negatively impact performance levels. Financial distractions can be devastating to training and competition as they’re usually not quickly resolved. They are usually issues that need a lot of time and energy over the course of several days, months or years.


Professional athletes regardless of their sport, face strikingly different circumstances for achieving financial wellness. Because of the radically different career statistics, of which age and earnings rate are major factors, the path to healthy financial decisions must include radically different considerations than those of non-athlete investors. It is imperative that advisors to professional athletes join their clients where they are on their financial journey and understand their individual intersection of behavioral tendencies and financial knowledge. Professional athletes are unique investors but with the appropriate advisors, they can achieve financial wellness, protect their earnings and financially support themselves and their families well beyond their professional competitive careers.     




Do you REALLY KNOW who is managing your money?


Do you REALLY KNOW who is managing your money?

" “He threatened to burn down my house with me in it,” one woman wrote in her application for a restraining order. “I don’t know what he’s going to do next,” a second wrote. “He choked me so hard it left a mark on my throat,” wrote another. “He is scaring my children and me,” a fourth woman said.

Yet the man, Douglas E. Greenberg, remains one of Morgan Stanley’s top financial advisers — and a celebrated member of the wealth management industry.

For years, Morgan Stanley executives knew about his alleged conduct, according to seven former Morgan Stanley employees."


Beyond Fancy Locker Rooms; a Win-Win-Win for Colleges, Student-Athletes and their Families


Beyond Fancy Locker Rooms; a Win-Win-Win for Colleges, Student-Athletes and their Families

by Courtney Altemus

“‘The paradox of education is precisely this,’ James Baldwin wrote, ‘that as one begins to become conscious, one begins to examine the society in which he is being educated.’”

–as recalled by Nigel Hayes in his article “Don’t Just Shut Up and Play,” Players Tribune, 2017*

Good news, this is not another article on the merits of either side of the NCAA student-athlete compensation debate. Rather, it is about why college athletic departments, high school recruits and their families/mentors should care about what schools are doing to help student-athletes live financially healthy lives.

The plethora of studies, reports and articles on the topic of paying student-athletes has brought to light the staggering tv contract revenues (est. $1billion/year to NCAA for march madness and upwards of $20-$30million/year for large football programs). To continue feeding those increasing revenues, the stakes for the schools to recruit the most talented student-athletes increase every day. Schools that bring solutions to their student-athletes for financial challenges vs. schools that simply define the financial challenges will differentiate themselves in the intensively competitive recruiting process.

Basic Financial Literacy and Budgeting

Student-athletes are bombarded with examples of what not to do with their money. Talking about the symptoms of financially unhealthy lives may provide enough fear for some student-athletes to at least try and avoid pitfalls. However, until student-athletes start getting help with the cause of the symptoms, those symptoms will continue to appear.

In his USA Today Sports** article about the subject of student-athlete compensation, Domonique Foxworth said, “(athletic directors) and the rest of the adults getting paid money generated by the players should stop paying this lip-service and start taking their obligation to the players seriously. They should take the time needed to understand the real challenges faced by the university’s unpaid labor, make the effort to engage experts who can help create effective solutions and don’t assume they always know best.”

One of the “challenges” Domonique was referring to is student-athletes’ budgeting and spending choices. He goes onto say, “Most adults can point to something they purchased during their college years as ‘dumb’ or ‘impulsive’ or ‘regretful.’ For example, at least once a week, one of my college teammates would get a new tattoo. I couldn’t embrace the idea of having something permanently inked onto me so I graduated with no tattoos. However, rims were a different story. I put some chrome feet on the whip, an Isuzu Rodeo. Like the previous sentence, my rims were cool in ’05 and I would be embarrassed by them today. It was an ego purchase. Coming off of Maryland’s first ACC Championship season since 1985, I felt I deserved a little reward.”

Now that cost-of-attendance stipends are being distributed, the challenges are greater. Schools are struggling to adequately address financial literacy for student-athletes. Domonique reflected on comments from some athletic directors on a panel in 2015 about cost-of-attendance stipends: “North Carolina State athletic director Debbie Yow voiced a concern. ‘You try to teach student-athletes about financial literacy,’ she said of the school’s student-athletes, ‘but you know you failed when you see them on their new hoverboard.’ (Alabama then-AD Bill Battle added), ‘tattoos and rims.’”

Schools should acknowledge to recruits and their families that it is a challenge to make responsible decisions when student-athletes receive stipends and grant money. Poor decisions can lead to distractions from their efforts in the classroom and in their sport. Schools should make a commitment to teach them basic financial literacy and budgeting in an effective manner with executable tools, customized to their individual needs.

Student-athletes differentiating between in-school amenities and real-life costs

In the Wall Street Journal*** article “The Money Bowl,” Jason Gay makes his argument to pay student athletes by highlighting the multiple millions of dollars that large college sports programs are spending on luxurious training facilities and amenities. Mr. Gay says, “This luxe-ification is done, of course, in the name of competitiveness: specifically attracting recruits and satisfying players so that a college can keep up in the multibillion-dollar universe of football and men’s basketball. Austerity has long since left the building. If you aren’t offering this stuff to kids, the theory goes, your opponent will.”

Further in Nigel Hayes essay, he says, “People say there’s not enough money to pay players. Yet there’s enough for all the lavish amenities so they can get players to commit to their schools and make even more money.”

If it’s commonplace for the teenage high school athlete with an undeveloped pre-frontal cortex to experience these shiny-object facilities, then schools will continue to build them. The schools seem satisfied that adequate ROI is being generated and they’re happy to have more resources to provide comfort and healthy lifestyles for their student-athletes. It seems clear that schools who don’t have sleek and state-of-the-art new facilities are at a recruiting disadvantage at the outset. What is unclear is what the differentiators (if any) are among the fancy athletic buildings and at what point the returns on incremental increases in flat screens or comfortable furniture start diminishing when factoring into a high school athlete’s decision on where they will play in college.

The schools who have invested in their facilities should leverage that investment in a more practical way that provides long-term benefits for student-athletes far beyond their time in school. They should acknowledge to recruits and their families that there is an enormous difference between enjoying amenities at school vs. the financial resources required to continue their luxurious living conditions post-college. Athletic programs, with or without fancy facilities can improve recruiting by making a commitment to help their student-athletes develop the tools to manage their financial resources after college, no matter what profession they choose to pursue.

Student-athletes going pro in their sport: How do they choose financial advisors?

According to the NCAA.org website, between .9% (women’s basketball) and 9.1% (men’s baseball) of student-athletes go pro in their respective sports after college. For those fortunate enough to sign a professional contract (1.1% of men’s basketball and 1.5% of men’s football players just to quantify some other sports), if they aren’t taught how to understand their financial needs and how to find the best financial advisors for their own situation, they’re at tremendous risk for creating new financial distractions and potential disasters for themselves.

Another area that schools can differentiate themselves to recruits is to outline their financial education and advocacy programs for student-athletes planning to turn pro in their sport after college. Many of the schools are proud of their programs to help student-athletes choose agents but they don’t have comparable programs to help student-athletes choose financial advisors.

It makes sense that schools who send some student-athletes to their professional sports leagues would want to highlight to incoming recruits how well prepared those professional athletes are to manage their finances. Not only is it an important differentiator when attracting recruits, it seems logical that a professional athlete who had a good experience in school, feels well-prepared to be financially responsible after college and has a financially successful athletic career might be more likely to give back to her/his alma mater.

Adding value to student-athletes post-college, no matter what profession

Student-athletes have very limited time outside of their academic and athletic obligations. Financial distress causes distractions from these pursuits and results in decreased productivity. They need experts who guide them in a proactive and positive manner about what they can do to prevent the financial horror stories they hear so much about. Schools need to be proactive about providing access to the experts for student-athletes. If a perception develops that certain schools turn out a higher number of financially unhealthy student-athletes, that perception will become reality. Those schools will then be fighting against their own reputations in the recruiting process.

Nigel Hayes includes this advice in his essay, “My challenge to the class of 2017 is this: Never accept it when someone says, ‘Just shut up and play.’ Or whatever the equivalent is in your field. Don’t accept it when they say, ‘Stay in your lane.’ Let’s use all possible lanes. Let’s create new lanes. Each of us is more than just the job we do for a few hours a day. Whether we play basketball or not.”

Incoming high school recruits know how tight the competition for talent is among schools. More student-athletes care about added-value beyond the fancy locker rooms.

--Courtney Altemus, CEO and Founder of TeamAltemus, Investor Advocacy and Financial Literacy experts.



** http://ftw.usatoday.com/2015/12/a-former-ncaa-football-player-explains-what-athletic-directors-are-doing-wrong

*** https://www.wsj.com/articles/stop-giving-college-athletes-million-dollar-locker-rooms-start-paying-them-1503075169