Navigating LIfestlye Changes - Part 2

In my last piece, I discussed the two pieces of advice that all National Football League (NFL) alumni provide to prospective players. In this edition, I discuss what I call the Five Levels of Money Mastery. These are the mindsets that I've noticed that players (and people generally) fall into when handling their finances. The levels are: survival, stability, security, success, and significance.

Survival Level

Players at the survival level are those who live in the moment. They take a very short-term approach to their finances. These are the players who are depending on each paycheck to stay afloat. They have bought into the fallacy that they will never have to worry about money again as long as they make more money or a certain amount.  However, they also keep spending money as soon as they earn it.  Their perspective and spending habits fail to recognize that no matter how much one makes, the financial outcome will be the same without spending less living from paycheck to paycheck.

Stability Level

Players at the stability level spend less than they make but depend on all additional money beyond their contract for savings. These players are not spending beyond their income but realize that they can’t save much should a catastrophic event occur. These players would need to find an income stream if football ended today quickly, so they would have less time to decide about their next move.

Security Level

Unlike those at the survival or stability levels, players at the security level of money mastery have enough savings to carry them for at least two years if the game ends today. This financial security allows them to take time to explore outside interests as they transition from the game. While the transition can still be mentally and emotionally challenging, players at this level do not have the added pressure of worrying about how they will pay the bills each month.

Success Level

The success level includes players who typically had a plan when they entered the NFL and could stay on course. These players most often began their NFL career understanding that they had a limited earning window and put guardrails in place to balance the financial pressures they encountered in the NFL. As a result of this planning, players at this level often express confidence and pride that they have used their brief opportunity to ensure their children will begin life in a much better place than anyone in their family.

Significance Level

Finally, those players at the significance level have been able to create “legacy” money. In other words, by saving and investing wisely, these players have accumulated wealth that will last beyond their lifetime and the lifetime of their children and grandchildren.

The Five Levels of Money Mastery don’t just apply to NFL players; they apply to everyone. However, few careers are as short-lived and as financially rewarding as NFL careers can be. Most young people entering the workforce would benefit from hearing from well-seasoned individuals who have been where they are. Whether you are a prospective NFL player, graduate entering the workforce, manager, or executive, the financial advice is the same: Learn to say “no,” stay in your financial lane, and spend less than you earn. Consider which level you want to be in at the end of your career and act accordingly. Your financial decisions today will determine if you will be a positive example of smart decision-making or a cautionary tale.