Economist Says NFL Player’s 4 Years More Profitable Than Lifetime for Most

A financial expert says a person could live well on what the average National Football League player earns in four years. In fact, the economist, Rhoda Israelov, says that four-year veterans have a chance to bank more by age 25 than most retirees have at age 65.

Israelov is an Indianapolis certified financial planner and a vice president of E.F. Hutton & Co. She bases her calculations on figures provided by Michael Duberstein, director of research for the NFL Players’ Assn. Her study is of interest because one of the arguing points by the union in the current NFL strike is that players have such a short time, an average of four years, to make the big money that pro football offers.

The union says the average NFL player earns $215,000 a year and has a career of just less than four years. Players also receive a pension of $150 per month for each season played. That would be $600 a month or $7,200 a year for a four-year player.

Her hypothetical case study is as follows: “Let’s have our frugal and extremely well-disciplined NFL player pay $20,000 to his agent, maintain a second residence during the football season, pay taxes and living expenses and save $100,000 each year for four years,” Israelov says. “With conservative investments, he accumulates a kitty of $550,000. With more aggressive investments gone right, we could be talking $700,000 or more.

“Of course, the football player has to make his retirement fund last longer. If he has invested wisely and wants to go on forever without filling out a job application, he will have to be satisfied with the equivalent of a $30,000 per year life style in today’s dollars. But having enjoyed a comfortable life style, it’s more likely that the player will want to try a second career or enterprise.

Israelov says that football players have a big advantage because their highest earnings are at the beginning of their adult years.

“From a pure investment standpoint, professional football players can afford to take some risks in order to achieve (financial) growth,” she says, mentioning real estate properties and partnerships, precious metals and global equity holdings as good bets for the players’ money.

“His investments should be coordinated with good tax planning, making use of single-premium insurance products, variable annuities, deferred compensation arrangements and other tax deferral strategies,” she says.