When you put out one fire, another one pops up. Sunday’s episode of Ballers was mix of resolutions and new beginnings. The Rock’s character Spencer Strasmore was not only cleared of any CTE worry (for the time being), but he was also able to take care of Vernon Littlefield’s photography problem. All in a day’s work. (There’s no shame in a grown man rolling down the windows and blasting Taylor Swift’s “Shake It Off.”) However, despite Spencer’s recent success in reeling in clients, he’s suddenly finding himself in hot water at work.
After seeing cell phone video footage of the “corporate event” party, Mr. Anderson, president of the money management company Anderson Financial, makes it clear that he’s had enough of the “niche market” of professional athletes. The potential money from superstar athletes isn’t worth the drama. Anderson threatens to fire both Spencer and Joe, Rob Corddry’s character.
At one point in their heated meeting, Anderson proclaims that he doesn’t want the hard-partying antics of pro athletes to scare away his “institutional clients.” I don’t think Spencer really understood what he meant. Inside the world of professional athletics, it is hard to realize that there is life outside of football. It’s impossible to imagine that even though you’re making a bunch of money at football, there are non-athlete professionals who are making just as much as you are and have been doing it for 20-plus years. Outside of our sports bubble, there is more money than we could possibly know. That’s why you see athletes with nice cars and homes, but you very rarely see an athlete who owns a sports team (looking at you, MJ).
Every year we hear about these super contracts with all this money guaranteed. These athletes think they are set for life, yet time and again we still hear statistics of how a majority of retired NFL athletes are broke in a few years. The problem’s pretty obvious: guys are spending too damn much. I know it’s a fictional television show, but Ricky Jerret will be broke three years after he retires. I’ve seen it first hand and his character fits the mold. While this is fiction, it’s dead-on accurate in portraying the lifestyle of some of these characters.
Time is money. You’ve heard that expression. As a financial manager now, the number one lesson I try to teach is a variation on that saying. When talking to a potential athlete client, the thing I try to get across is that their working years are shorter than anyone else’s. It’s a small window. They’re making a large amount of income for a fixed amount of time. They aren’t like a doctor who makes pennies out of residency, but then makes $300,000 (or more) for the next 35 years, with good job security. Professional athletes have, at best, a 10-year window to make as much money as they can before they retire. Then they might have 50 years of their life ahead of them. I stress this point to the younger guys the most.
The average NFL career lasts three years. Life is a lot longer than that. If you’re making $500,000 a year (before taxes) and spending $250,000 year, how in the hell do you plan to make that money last? You work your ass off in high school and college to get the opportunity to play in the NFL, and then you piss the opportunity away by getting caught up in the “lifestyle.”
This window of opportunity should be the selling point for a money manager like Spencer Strasmore. If his only clients are going to be professional athletes, then he needs to find a better business model than throwing extravagant parties that promote the lifestyle. What good is being a financial advisor to professional athletes if all your clients run out of money? For all the good Spencer does for his guys, the number one thing he should be emphasizing is a more grounded lifestyle. Buy the Audi instead of the Ferrari. Buy the three-bedroom house instead of the six-bedroom house. It’s very basic, but for whatever reason it continues to plague our league. I would say you can’t blame these young guys — and it’s true that many people take advantage of athletes — but by this point, there’s too much information out there.
Of course, there are examples of guys who are doing the right things. I’ve read that Gronk only lives off his endorsement money. Meaning that every game check goes straight to savings or investments. That’s a great strategy, but he is one of the few lucky enough to have endorsements that can pay for his lifestyle while also putting money away for his post-football future. Most guys have to make a few years of their salary last a lifetime.
While Ballers portrays the NFL lifestyle in all its glamor, I hope the show continues to portray the consequences, too. Early on, we glimpsed Vernon’s battles with his family over money and control, but now we’re caught up in a photo scandal that doesn’t have nearly the same consequences. If Ballers is going to keep it real, it must show the lifestyle’s negative consequences as much as it shows the Lamborghinis and parties. Moving forward, I would like to see Spencer Strasmore better identify the root cause of his clients’ problems. If he doesn’t, I don’t see how he can be a financial advisor for very long.
Tyler Horn is a former NFL player turned financial advisor. Click here for the and and and and and and recaps.