The college sports landscape has changed significantly since student-athletes have the opportunity to receive benefits from their name, image, and likeness (NIL).
In a bid to assist its athletes, the University of Memphis recently announced a four-year partnership with Robinhood Markets Inc. The U of M is collaborating with the California-based financial services firm to use its Robinhood Money Drills program.
The goal is for the U of M to help its athletes understand how to monetize their personal brand and avoid financial issues.
“These kinds of partnerships are really critical,” Laird Veatch, VP and director of intercollegiate athletics for the U of M, said in a press release. “They are welcomed in this era of college athletics, especially when some student-athletes are dealing with challenges never faced before with NIL.”
Mary Elizabeth Taylor, VP of international government and external affairs at Robinhood Markets, told MBJ that Robinhood's financial education program recognizes the unique financial position of current college athletes and aims to close the knowledge gap for student-athletes.
“By providing resources and support to universities, Money Drills empowers athletes to develop the skills and confidence to manage their financial futures, regardless of where their future career path may take them,” Taylor said.
Pankaj Jain, Ph.D., is a professor and the chair of the Department of Finance, Insurance, and Real Estate at the U of M’s Fogelman College of Business and Economics. He said that with student-athletes potentially receiving millions of dollars at a young age that having a program at the university to focus on ways to best utilized their funds is essential.
“With the athletes, especially with [NIL], they can become very early millionaires,” Jain said. “It’s so easy for them to be duped and taken advantage of. There are many cases of those who became rich and ended up being bankrupt. We thought it was important to teach the [athletes] — who get this early access to money — and educate them on what finances are all about and to make sure they’re saving up.”
Budgets, NILs, and college athletics
Fogelman College is hosting the Robinhood program. Taylor said the course is expected to be offered every summer over the next four years and be available to all U of M student-athletes, as well as traditional students.
According to Taylor, the course is expected to cover a variety of topics that should be beneficial for student-athletes receiving NIL deals, including discussions on career planning; income generation; foundations of financial planning; statements and budgets; taxes, costs, and expenses; making auto and home decisions; managing investments such as in stocks, bonds, and real estate; retirement and estate planning; and managing insurance needs.
“It’s not a boring course because we’re actually bringing in celebrities, and we’re also going to have course material through videos,” Jain said. “One of the first things we talk about is making money, and in the case of the student-athletes, what are the best ways to optimize their NIL contracts. In addition, we also try to teach them about doing tax planning and making sure they’re doing such things as putting money in a 401(k). We’re going to have the student athletes prepare their own financial statements and budget to teach them the value of money.”
The Robinhood Money Drills initiative launched in April 2022. West Virginia University conducted the pilot for the program. Taylor said Memphis is one of five universities so far that has partnered with Robinhood. Other colleges include Kansas State University and Duke University, which Jain thinks puts the U of M in good company.
“This the type of program helps when we are mentioned in the same league as Duke," Jain said. "This partnership puts us in a national limelight."
