Former baseball star Alex Rodriguez had to learn how to manage a lot of money from a young age: He went straight from high school to the big leagues and signed a three-year, $1.3-million contract with the Seattle Mariners after being drafted in 1993. He also got a $1-million signing bonus.
Earning so much as a teenager "was a culture shock," he told The New York Times Magazine in a 2019 interview.
Rodriguez, now 43, wants to make sure his two daughters, ages 11 and 14, have the right tools to make smart money decisions, so he turns car rides into money and business classes.
One lesson in particular appears to be paying off: start investing young.
After giving his kids money to invest in stock portfolios five years ago, "they have both doubled their money, for sure," he told Sports Illustrated's Ben Reiter for his cover story on the reinvention of A-Rod. Rodriguez was suspended for the entire 2014 season for allegedly using performance-enhancing drugs. He retired from baseball in 2016 and is now the CEO of A-Rod Corp.
Investing is one of the most effective ways to build wealth, and the earlier you start, the more you'll benefit in the long-term. That's why Rodriguez also advises young professional athletes, who will likely earn most of their money in their twenties and thirties, to put their money to work right away. "You have an incredible opportunity if you're frugal and you're smart and you put your money away early," he tells CNBC Make It, if you take advantage of the power of compound interest.
You have an incredible opportunity if you're frugal and you're smart and you put your money away early.Alex Rodriguez
While Rodriguez's business lessons don't always go over well with his daughters — "Of course, they put the radio up … they're definitely sick over my lessons," he tells CNBC Make It — Rodriguez is in it for the long haul. As his mentor and friend Warren Buffett says, "teaching kids sound financial habits at an early age gives all kids the opportunity to be successful when they are an adult."
Ultimately, learning is the key to long-term success, says Rodriguez: "Knowledge is power. … If you stop learning, you stop living."
Don't miss: Here's the money advice Alex Rodriguez would give his younger self
Like this story? Subscribe to CNBC Make It on YouTube!
