Q&A with MLS Player turned Financial Planner William Hesmer

 Q: Can you talk about your journey from being a professional athlete into a financial planner? A player of your caliber and resume usually finds a way to stay involved in the sport whether a coach or technical director, how did you find yourself being a financial planner?  Did you always know you wanted to be involved in money management and finance post career?

A: When I was first drafted to Kansas City, I fully intended to play one year, enjoy the experience and then go to law school.  Being a third string goalkeeper and making $7,000/year wasn’t exactly how I envisioned my first job out of Wake Forest… However, I worked hard, was lucky to get some opportunities at a young age, especially for a goalkeeper, and found success on the field.  For better or worse, I was never all in as a soccer player.  I feared that the longer I played, the more stale my degree would become and the harder it would be for me to enter the “real” world.  I was making decent money playing soccer, but not the kind that is life-changing, so it was never worth the sacrifice in my eyes.  Moreover, I knew from day one that I did not want to stay in soccer long-term, as a coach or technical director.  As much as I would have enjoyed staying in the game that had given me so much, in those roles, you are hired to be fired and I did not want to put my future family through that transient lifestyle. 

Therefore, my entire playing career I was always looking for ways to better myself and prepare for the moment my soccer career would end.  I was accepted to law school in 2008 and intended to retire, until I had a break out season with the Columbus Crew.  At that point in history, a lot of things aligned perfectly, even though I couldn’t fully see it at the time.  We won MLS Cup and I was invited to play with the US National Team.  Outside of soccer, the world was literally falling apart due to the financial crisis.  My friends graduating from law school could not get jobs working for free.  I had a lot of discretionary dollars saved up from being a frugal, single athlete living in a very inexpensive city.  This is when I took a keen interest in the equity markets.  Naively, I began to pick stocks that I thought were irrationally cheap.  I had no formal training other than a bunch of business school classes from college, a handful of investing books I had read and CNBC.  Looking back now, I had a lot of success investing, but made a ton of amateur mistakes.  Most importantly, I fell in love with it and knew I wanted to make a career in money management.

Q: If so, did that play a role in how you handled your finances through your career?   How valuable were your experiences outside of soccer with internships and such when finally hanging up the boots?

A: A year of managing money every afternoon in my small shared apartment eventually led me to reach out to the director of finance at Ohio State, who in turn put me in touch with an investment advisory firm in Columbus, OH that managed a little over $2 billion for high net worth individuals.  I met with the owner of the firm and after my one day of shadowing him around, I begged him to hire me as a 30 year old professional athlete intern next to his 18 year old Ohio State freshmen interns. To that point in my life, this was maybe the second best decision I ever made, next to choosing to attend Wake Forest.  I worked there for two years and learned things, not only about financial planning and investment management, but also how to run a business, specifically a wealth management business.  The firm that I worked for did things a lot differently than most, and I was entrepreneurial enough to grasp that early on and soak up as much of it as I could.  Unlike most that enter our business, I was taught the technical skills first.  So many enter our world as salesman, grabbing as many dollars as they can, then they learn the technical skills required to manage money.  I am forever indebted to the firm for the opportunity and the internship was life changing to say the least. 

Q: Back in your career, you had a very serious injury that ultimately played a role in your retirement…Can you talk about the importance of understanding that nothing is guaranteed in the athlete world and being prepared is imperative?

A: This is by far the hardest thing to get across to professional athletes of any age.  So many athletes have been invincible the better part of their entire life, so much so that they have convinced themselves that it could never happen to them.  From my position, it is such a hard topic to discuss.  It is simply an awful thing to have to think about, much less verbalize.  Innately, the athlete becomes defensive and shuts down.  Not to mention, the longer the athlete has played the game, the harder it is for him to see the end, ironically.  It is such a hard “drug” to quit, that even the thought of losing the attention, fame, money and bright lights is too difficult to fathom.  There are still far too many, even really smart athletes, who are not prepared to carry on a fulfilling and happy life once the music stops.

Q: In Major League Soccer, where you spent the better part of 10 years, the salary isn’t as glamorous across the board as other the other major US sports, how important do you feel financial awareness is?

A: It is so much more important.  Even though salaries are starting to become more impactful, the majority of athletes are playing because they love the game, they love competing and they want to play a role in making Major League Soccer the top soccer league in the world.  However, they do so at tremendous sacrifice.  The players on the lower end of the salary scale are foregoing their most valuable asset -- time.  Because many are barely able to save, most are going to be forced to enter the “real” working world at a much older age at a much lower salary.  Unless, they climb the ladder quickly, most will be forced to work longer than their counterparts who entered the workforce in a traditional fashion.  Needless to say, I think it is imperative that all sports leagues do a better job financially educating their constituents.  

Q: What are some key characteristics and accomplishments, someone should seek in a financial advisor?

  1. Education – I would make sure that the financial advisor have some type of higher degree/certification that not only shows their dedication to their craft, but also holds them to a higher standard of ethics than others.  The Certified Financial Planner designation is probably the most highly respected in our industry.  Unfortunately, the barrier of entry to be a financial advisor is extremely low, so I think this is paramount.
  2. Fiduciary – I would make sure that the advisor acts as a fiduciary.  Simply put, this means that at all times he or she must act in the investor’s best interest. 
  3. Like-Mindedness – I would make sure that your advisor works with others like you, understands your unique needs as an athlete and shares your same core values. 
  4. Trust – This is by far the most important.  If you do not feel like you can share everything with your advisor and receive completely honest and candid feedback, like any relationship, it will not function appropriately. 

Q: As a former athlete, and now dealing with athletes… what are some of the common problems you find athletes face when it comes to money management and just being smart with their spending habits and financial literacy?

A: By far the most common problem is not saving enough.  So many think that their income is slightly above normal and that when they stop playing, they can easily go find a six figure job, even without a degree.  A big part of this is the public pressure or persona athletes feel they must exude.  When an athlete becomes a “professional” athlete, he feels like he needs to “act” the part from the jump, even with little to no guarantees in his deal.  For the most part, MLS players do not fall in this trap, but there are plenty who have.  Arguably the second biggest problem is not saying no.  So many guys feel like they need to take care of family and friends that they forget to take care of themselves first. Sadly, 80% of athletes admit to being taken advantage of by family, friends and advisors, so the question of who they can trust when it comes to their finances should not be taken lightly.

However, I believe that the biggest problem is not having an exit strategy; not knowing what you would like to do with your life when the game ends.  This is important even if the athlete could live happily on what he has saved.  In my role, I spend a lot of time trying to maximize dollars, whether it be in the markets or tax strategies, but by far the biggest impact I can have on a young athlete is helping him prepare for his next career, smoothly and happily.  That might mean setting him up with others in his field of interest to discuss opportunities or it might mean analyzing financing options to go to college or graduate school.   The athlete will receive such a greater benefit, both financially and spiritually, if he is prepared to walk away from the field and enter a career that he is passionate, trained and equipped to attack.        

Q: Lastly, can you leave use any final advice you think is imperative to build financial literacy and improve money management.

 A: Like anything worthwhile in life, financial security and freedom requires discipline and sacrifice.  Most all athletes naturally have those two traits in spades.  For whatever reason it has not translated over to the financial well-being of most athletes.  I liken the start of becoming more financially responsible to the first time going for a workout after Winter break.  The first morning the alarm clock goes off, it is a brutal climb out of bed.  Even worse is the first mile.  Waking up the following morning is perhaps even more vicious with the soreness setting in.  However, after week one, it gets easier.  After, week two, it is routine.  After week 6, you know no other way.  And after week 52, you would be lost without it… Building a financial plan or investment strategy is no different.  Keep your eye on the prize and maintain your discipline in the face of internal and external pressures, of which there will be many.