College athletes need personal finance training

More and more college athletes – not just those who are going pro – are starting to make money. In June, the Supreme Court ruled narrowly in favor of college athletes, saying that from July 1 they can benefit from their educational prowess on the field. It’s a blow to the NCAA, which claims its commitment to amateur sport is in jeopardy.

Plus, it may not be long before the Supreme Court joins the majority of states passing laws allowing student athletes to be compensated for the use of their name, image or likeness.

Many state bills require student-athletes to take a personal finance course, an eminently sane idea given the likelihood that athletes will suddenly have more money to manage than ever before. With the stroke of a pen, the NCAA can and should begin to encourage personal finance classes and ensure that all athletes in every state take them in high school.

We know that the earlier young people learn to manage their money, the better. Research shows that healthy financial habits established earlier in life are essential for building financial capacity in adulthood. This is one of the reasons there is momentum behind more high schools and colleges offering personal finance courses.

Yet an anachronistic NCAA policy actively discourages high school student-athletes from taking a personal finance course. To qualify for college scholarships, high school student-athletes must take core courses defined by the NCAA and personal finance is not one of them. While English and math lessons are certainly valuable, so is a course in practical life skills like personal finance.

Student-athletes especially need to know how to pay themselves first, the power to generate compound returns, invest in the stock market, establish and manage credit, and avoid bank charges. And high school is a good time to teach these essential life skills BEFORE you set foot on a college campus.

Power Five Conference Fellows today receive stipends ranging from $ 2,000 to $ 5,000. Given the many states that pass laws to allow athletes to be paid (five state laws went into effect on July 1), many athletes will soon have money in their pockets as they sell themselves. and earn support dollars. With the power of social media, those who can benefit from it won’t be limited to star athletes.

It doesn’t matter if you are Zion Williamson or a talented lacrosse player. You have to be smart with your money. My conversations with many high school teachers over the years have confirmed that the NCAA’s policy of not recognizing personal finance as a core course discourages students from taking it.

A teacher told me she applied to the NCAA to qualify her personal finance course as a core course, only to be told that association guidelines prohibit teaching life-related issues. personal, such as paying for college, types of credit, investing, insurance, and budgeting.

Part of all of these sad stories of professional athletes losing all their money is a lack of financial literacy. The NCAA can help fix this problem with all college athletes by simply changing some damaging, short-sighted policy that doesn’t hold water. After all, 98% of NCAA athletes never land a professional contract.

Tim Ranzetta is co-founder of Next Gen Personal Finance, a Palo Alto, Calif., Nonprofit startup that is dedicated to ensuring that by 2030 all high school students take a personal finance course. He was a college athlete at the University of Virginia and grew up in New Jersey.