What Utah Jazz star Trey Burke can teach you about money management
He said young players should take the time to understand where their money is going, what their expenses are and how their money is being invested. Though someone else may be charged with managing it, the ultimate responsibility still lies with the person who’s making the money to keep track of it.
“You want to understand loans, what credit can do (and) what bad credit can do,” he said.
Jefferson said, as he prepares for the end of his career, he has paid off outstanding loans and reduced spending in an effort to “simplify” and lower expenses. He also has contributed heavily to his 401(k) plan, which the league matches at 120 percent.
The NBA and the Jazz have each implemented programs to assist players in learning how to cope with their newfound riches.
Learning the ropes
The NBA’s Rookie Transition Program is a mandatory initiative for new, young players entering the league that helps provide them with information and resources to assist them in making better decisions in order to more successfully adapt to the lifestyle and challenges of the NBA. Created in 1986 by the league and the National Basketball Players Association, the program claims to be among the most comprehensive of its kind in professional sports.
There are eight categories on which the program focuses, including financial education, the business of basketball, drug and alcohol education, health and safety, legal education, media and image communications, professional ethics, and technology and continuing education. The league also sponsors a program to help players transition into new careers after retirement.
Utah Jazz president Randy Rigby said the team and many other NBA franchises have developed programs to help teach new entrants the lessons they need to manage their newfound wealth responsibly.
“You want to constantly reiterate to them that the average NBA career is four or five years, and you’re going to make a lot of money, but it will take fiscal responsibility (to manage it correctly),” he said. “This type of income is not going to be there forever, so you need to manage it so that you have (adequate) financial resources going forward.”
He said the league also conducts meetings with each team in their cities once or twice a season focusing on issues such as fiscal responsibility.
“We make sure our players are at those activities,” he said.
Rigby said the team has forged relationships with local financial institutions that offer financial advisory and wealth management services where players can access expertise on proper money management. The team also offers long-term help to current and alumni Jazz players in their post-basketball careers.
Trey's other team
When Trey Burke was drafted last summer, his family hired Michigan-based Compass Management firm headed by Daniel Sillman and Jordan Dumars. According to Sillman, Compass is a full-service management company that works with young athletes to help them avoid the pitfalls that often befall the newly wealthy.
The company advises athletes on all aspects of fiscal responsibility from housing to investments and tax planning. Issues that most high net-worth individuals may know, but athletes are usually unaware of or do not learn until it's too late.
Trey Burke met Sillman and Dumars while attending the University of Michigan. Both are alums of the Ross Graduate School of Business in Ann Arbor.
Sillman is the son of an investment banker and money manager, while Dumars’ father is Detroit Pistons’ president and NBA Hall of Famer Joe Dumars. The firm represents about 20 athletes from various sports.
Sillman said a team of professionals is assembled to closely monitor every aspect of their clients’ financial well-being.
“When we work with Trey, for example, we’re helping him from A to Z for everything from basic private banking needs to credit management all the way through helping him establish budgets for himself and his business entities,” he said.
- The 25 most educated cities in America: Where...
- There's more to why Americans don't save than...
- How do schools calculate new stipends for...
- How Medicare is trying to start a healthier...
- How to hack your budget and cut costs —...
- Startup hopes to help children with autism in...
- Delta to offer nonstop flights from Salt Lake...
- Balancing act: Survey: Many people work...