Personal Finance

Life after the draft: Ex-NFL stars share sound money advice for new players

Key Points
  • Many professional football players struggle to make their income last in retirement.
  • To avoid that fate, these ex-NFL stars have some advice for newly minted players.
NFL Commissioner Roger Goodell walks past a video board displaying an image of Baker Mayfield of Oklahoma after he was picked #1 overall by the Cleveland Browns during the first round of the 2018 NFL Draft at AT&T Stadium on April 26, 2018 in Arlington, Texas.
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The NFL draft turns some college football players into pros ... and millionaires.

When newly eligible players are selected to play in the National Football League, lucrative contracts go hand-in-hand with big bonuses and a sizable benefits package, including a 401(k) plan match, disability and life insurance, tuition assistance, health reimbursement and a pension.

For them, life is about to change. While becoming rich is one thing, staying rich is another.

Nearly 80 percent of retired players go broke in their first two years out of the league, according to Sports Illustrated.

Once a first-round draft pick, former NFL player Patrick Kerney beat those odds. The former Pro Bowl defensive end socked away the bulk of his income after 11 years with the Atlanta Falcons and the Seattle Seahawks.

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After Kerney retired, he earned an MBA from Columbia University and went on to give financial advice to other NFL players. He is now the director of business development at NFC Investments and principal at Kerney Insurance.

To newly minted pros, Kerney advocates for a very conservative mindset at the outset. "Keep a year's worth of spending in cash in a high-yield savings account and invest the rest," he said.

"They need to act like this contract is the only contract they'll ever have in the NFL and treat future contracts like gravy."

Willie Thomas, a former Pro Bowl linebacker who also became a financial pro, dedicates himself to working primarily with athletes on managing their wealth as a Merrill Lynch advisor based in San Francisco.

Thomas admits to facing financial trouble early on in his football career in Seattle after buying a house for his mom that stretched his funds to the breaking point.

Now, Thomas recommends that young players find a trustworthy advisor and set up a financial plan with a monthly budget and withdrawal rate of 4 percent or less. That will help players establish parameters around spending and manage requests for money from friends and family, he said.

To protect yourself and your retirement, it's important that you understand the type of advice you're getting when you meet with a financial advisor. [Click here for the key questions you should ask.]

But naturally, with a windfall also comes the temptation to splurge, and that's OK — within limits.

"Diversification is not buying a Mercedes and a BMW," said Jeff Francis, a private wealth manager at Raymond James Financial Services and former quarterback for the Los Angeles Raiders and Cleveland Browns.

Francis advises players against trying to keep up with the Joneses. "We need this money to last a lifetime, so figure out a lifestyle that's sustainable," he said.

"If you want a big purchase, by all means, but it shouldn't happen every year."

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