What I Wish I Knew As A Rookie

I had the pleasure of attending the 2019 MLS Rookie Symposium to speak on the Reaching Out Panel with Jon Harris founder and CEO of ATHLife, current MLS Player Kyle Zobeck, and former MLS Player Darrius Barnes.

It was a great opportunity to speak with the incoming rookie class on the what to expect as they embark on their careers, how to take advantage of the platform they’re on, not being afraid to ask questions, and of course how to be a frugal athlete.

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As MLS grows, it’s great to see rookies get exposure necessary to prepare them for life as a pro because now soccer is a job and not just something you are good at. MLS and MLS Players Association have continued to provide tremendous resources for their players and it’s amazing to see the growth from when I first came into the league. We had a couple panels now the rookies were able to partake in an orientation which allowed for a more intimate setting.

I’m 9 years removed from when I first stepped into the league and can remember the year vividly what I did and did not know. If I were to start as a rookie all over again, these are things I wish I would have known:


Finance 101

My first year, I had no idea how to manage money. Besides the basic principles: save more than you spend, maximize your 401k, and stay away from credit card debt, I didn’t know much when it came to finances. In fact, my rookie year the first thing I did with my signing bonus was put it into a CD* for a year. My dad and I still joke about the different scenarios that could have played out if I made a different decision. My first year, I didn’t have a car and I didn’t have my signing bonus sitting in my checking account waiting to be spent on God knows what. Yes, a CD may not be the best investment strategy but it gave me a year to learn about Finance 101 and get acclimated to the lifestyle of a professional athlete.


*A Certificate of Deposit also known as a CD is a savings certificate with a fixed maturity date and specified fixed interest rate that can be issued in any denomination aside from minimum investment requirements. A CD restricts access to the funds until the maturity date of the investment. CDs are generally issued by commercial banks and are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per individual.  - Investopedia


Jock Tax …..Taxes in general

I remember complaining to my parents that the IRS made a big mistake because I was paying taxes in multiple states. I was so perplexed trying to figure out why when I lived in Philadelphia, Pa I had to pay taxes in Missouri and Texas. It was at that moment, I learned about the jock tax*. Thanks Michael Jordan!!!

My first year was a great learning experience. I learned that you have to make sure your accountant has experience when dealing with professional athletes and their taxes. There are so many different nuances that you are faced with as an athlete that you have to consider during tax season. Money from contracts, endorsements, appearances, etc all have to be included and accounting for the different deductions have to be taken into consideration. My second year, I came better prepared and even hired a different accountant to help the next time around.


*Jock Tax is a tax where Players have to pay a withholding tax to the visiting state for road games, but they also get a tax credit in their home state for taxes paid in other states. If their home state has a higher tax rate, players may owe more tax than they expected


Opportunity

The odds of becoming a professional athlete are less than 1%. Out of all the kids you played youth sports with, then high school sports, then college , you were the one fortunate enough to go on to the highest level. Don’t waste the opportunity at hand. If I had known, the position I was in from the very beginning I can only imagine how big my platform would be now. Of course, you have to keep the main thing the main thing and focus on your sport. However, this shouldn’t stop you from expounding on your brand, building within the community, and strategically planning for your post career.

Budget

Simply knowing where your money is being spent can give you peace of mind. Understanding how much you allocated for certain expenses gives you clarity on different things you may want to spend money on. Understanding fixed expenses versus variable expenses and how to properly save for different items will allow you to better manage your money. There are so many little things you pay for that you don’t even realize whether it’s renters insurance, Netflix subscription , dining out, or internet on flights, having a budget goes a long way.


Fixed expenses-an expense that does not change 

Variable expense-  expense that increases and decreases