The Most Important Things Your NIL Advisor Should Do
- Brendan Fraleigh
- 4 days ago
- 7 min read
Name, Image and Likeness (NIL) has created a massive financial opportunity for college athletes.
But with that comes outside pressure, added complexity and the importance of getting this "financial thing" right on the up front.
As a college athlete today, you are navigating:
Endorsement Deals
NIL Collectives
Revenue-Sharing Agreements
Business Income
Contract Compliance
Not to mention finding an agent, the right financial advisor and making sure you build a circle of people you can trust.
For you and most college athletes, this is the first time in your life you are earning significant income.
And without the right guidance, that could all go away as quickly as it came in.
In today's blog, I am going to outline the most important things your NIL Advisor should be doing for you and how to think about wealth management as an athlete.
Understanding the True Value of NIL Income
Most athletes we work with focus on the headline number of their NIL deal. That is a natural instinct. Think about it...schools are offering you life changing money at the age of 18. I would be caught up in the number too. But it is important to remember the amount that is listed in your contract is not the number you take home. News flash...it is going to be a lot smaller than you think.
So then how should you be thinking about it?
Well, it is first important to understand that NIL income is taxable income.
But unlike a typical salary, this is reported as 1099 income. That means taxes are not automatically withheld.
This is the first thing any advisor you work with should explain to you. Any good NIL advisor helps you understand:
Net Income After Taxes
Contract Structure
Payment Schedules
Long-Term Financial Implications
These are table stakes for any collegiate athlete.
And that starts with understanding the true value of your NIL income.
Build the Right Tax Strategy
Understanding how NIL income is taxed is only the first step. The next step is building a strategy to manage the taxes that come with it. The challenge is that nothing is automatically withheld from this income to cover your future tax bill. One of the biggest financial mistakes we see NIL athletes make is underestimating how much they will owe in taxes.
Unlike a traditional job, NIL income is treated as self-employment income, meaning athletes may owe federal taxes, state taxes, and self-employment taxes.
Uncle Sam is going to get his fair share, whether you plan for it or not.
Any good financial advisor should help you with the following:
Quarterly Estimated Tax Payments
Deductible Business Expenses (if applicable)
Coordination with your CPA
This alone can save you tens of thousands of dollars in taxes. When it comes to finding the right financial advisor, these should be things they are discussing with you before money even starts hitting your account.
If you are questioning whether you need a financial advisor, check out this video...I think it will change your perspective pretty quickly.
And this leads to one of the most important mindset shifts NIL athletes need to make.
Treat Your NIL Like a Business
Believe it or not, your are your own business now. Name, Image, and Likeness income is essentially entrepreneurial income. I know that may sound strange, but it's true. Any good financial advisor will help you build the proper structure around "your business." Here's how...
The first and most common step is creating a LLC. But not just any LLC. Your financial advisor should help you create a LLC...taxed as a S-Corp.
The “taxed as an S-Corp” part is extremely important.
Let me show you why.
LLC Taxed as a S-Corp
Imagine you earn $1,000,000 in NIL deals this year.
If that income simply flows to you personally, the IRS treats it as self-employment income.
Which means the income is subject to self-employment tax.
Self-employment tax is made up of two parts:
12.4% Social Security tax
2.9% Medicare tax
That’s 15.3%.
However, the Social Security portion only applies up to the wage limit (around $170,000 depending on the year).
So before we even talk about federal or state income tax, you would owe roughly:
$55,000 in self-employment tax alone.
That’s the cost of running your NIL brand without the proper structure.
Now let’s look at what happens when your NIL income flows through an LLC taxed as an S-Corp.
Instead of all $1,000,000 being treated the same, the income gets split into two buckets.
First, you pay yourself a reasonable salary.
Let’s say that salary is $250,000.
Payroll taxes apply to that salary just like a normal job.
But the remaining $750,000 can be paid to you as a distribution from the S-Corp.
And here’s the key:
Those distributions avoid self-employment tax.
So instead of paying about $55,000 in self-employment tax, you might only pay around $30,000.
That’s a potential tax savings of around $25,000.
Again, as a collegiate athlete, navigating this correctly can be a game-changer.
Coordinate the Right Professional Team
We've established the true value of your NIL income, built a tax strategy, started treating your NIL income like a business...
Now what? Your professional team is more than just your internal family now. And as a business, that starts with the right financial advisor...a financial advisor that works specifically with individuals in your shoes. But beyond that, your financial advisor should serve as your financial quarterback. That means controlling everything in your life with a dollar sign in front of it.
Cash Flow Planning
Tax Planning
Risk Management
Estate Planning
Investment Management
One of the biggest misconceptions athletes have is thinking their agent handles everything.
Agents negotiate deals. But a good NIL advisor helps coordinate the entire financial team around you.
That includes:
CPAs
Attorneys
Insurance Specialists
Agents
Marketing Representatives
NIL income creates legal, tax, and financial complexities that require multiple professionals working together. That all starts with a strong financial advisor acting as your financial quarterback, making sure everyone is aligned and that decisions are made with your long-term financial interests in mind. Without coordination, things can fall through the cracks.
It would be in your best interest to have someone you can call that understands your entire financial picture if something were to happen.
Turn Short-Term NIL Money Into Long-Term Wealth
History shows most athletes will never make it to the highest level of their sport.
The reality is that you may only earn NIL income for a short period of time.
Only the man above knows what your future holds.
But the right financial advisor plans for the worst while helping you get ahead of 99.9% of people your age.
And you have the greatest superpower when it comes to building financial security:
Time.
Starting early is one of the most powerful advantages you have.
That’s why a good financial advisor helps athletes start investing while they are still in college.
And in return, it can open the door to powerful tax-advantaged accounts like:
• Roth IRAs
• Solo 401(k)s
• SEP IRAs
These accounts allow athletes to reduce taxes, grow investments tax-free or tax-deferred, and start building long-term wealth early.
For example, a successful NIL athlete could potentially contribute tens of thousands of dollars per year into retirement accounts depending on their income and business structure.
That kind of early investing creates a massive long-term advantage.
The goal is simple.
Turn short-term NIL money into lifetime financial security.
If you want more specific tips on how to do this, check out The Moment Guide to NIL & Revenue Sharing.
Final Thought
Name, Image, and Likeness has fundamentally changed collegiate sports forever. You now have the ability to earn life changing money at the age of 18. But with that comes the responsibility of taking care of it.
Hiring your financial advisor may make or break your future financial security.
And their job is to help you build a financial foundation that lasts long after your college days are over.
Get in Touch With An Advisor
Frequently Asked Questions
Here are some answers to questions I received frequently about this topic.
How does Moment Private Wealth help college athletes?
Moment works to help athletes ensure they have the proper professional on their team first. The second step is helping educate athletes about what they should be considering. The third step is helping athlete implement the necessary strategies, planning, and investment to maximize their NIL earnings.
How are the earnings taxed?
All of the field income is taxed as 1099 or self-employment income.
How does Moment Private Wealth make money?
We are only paid in one transparent way, by our clients. We receive no kickbacks or participate in any profit-sharing arrangements. Our fees are simple, transparent, and clear for our clients.
How are you different than other financial advisors? We are specialists in working with professional athletes and entrepreneurs. We limit the number of new clients we take on. This allows us to provide unparalleled value and highly personalized service to professional athletes. We work as a team to service our clients. We believe in building a team of “A” players. This ensures our clients receive world-class tax, estate, insurance, and investment strategies. We focus on educating first, then executing.
How do you work with other members of my team? We believe in the power of the team. For most of our clients, their team consists of Moment Private Wealth, an accountant, an attorney, a banker, and an insurance specialist. We help our clients build out their team of individuals or work with existing partners that clients have. Our goal is to ensure every family has a team of experts to protect their interests.
Why should I consider hiring Moment Private Wealth? Great question! But first, let us explain why you shouldn’t hire us. If you’re looking for an advisor who will pitch shiny object investments or be a “yes man” you are in the wrong place. Why? Because we believe in being truth tellers and only giving advice that we take ourselves. The investments, strategies, and planning we do are all things our advisors do with their own money. If you are an athlete or entrepreneur interested in things like lowering your tax bill, investing smarter, and finding a trusted partner, we might be a good fit.
*Moment Private Wealth offers information on tax and estate planning that is general in nature. Tax and Legal advice are not provided by Moment Private Wealth. Consult an attorney or tax professional regarding your specific legal or tax situation.
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