(Bloomberg) — Young athletes navigating the burgeoning world of big-money sponsorship deals are teaming up with Bank of America Corp.'s financial advisers. to plan their financial future.
BofA's Merrill Wealth Management and IMG Academy, the Florida-based high school sports powerhouse, are partnering to provide financial education to student-athletes and their families, covering topics including saving and spending, credit and investing.
The program will be available at IMG's boarding school in Bradenton and online at the beginning of the next school year, according to leaders.
“This generation will face financial decision-making in a different way than other student-athletes have in the past,” Greg McGauley, head of Merrill Private Wealth Management, said in an interview. “They should be better educated at a younger age.”
College sports have entered a new era as restrictions are eased on players making money, including their name, image and likeness, also known as NIL. This has sent Division I athletics into a financial, athlete frenzy bringing to millions in brand endorsements and marketing deals.
Total NIL compensation for NCAA athletes will reach about $1.67 billion during the 2024-25 school year, according to a REPORT from the Opendorse online marketplace, which counted approximately 150,000 transactions involving more than 100,000 athletes.
With student athletes earning money during their college careers, some schools have taken advantage financial experts to teach players how to manage their earnings. That process will now begin earlier at IMG, located about an hour south of Tampa. The school, which counts Venus and Serena Williams as alumni, has long sent a stream of athletes to Division I schools and eventually professional ranks in sports including football, soccer and basketball.
Meanwhile, for the biggest US banks, wealth management has been a competitive and fast-growing business. They have poured resources into the sector as they try to lure new clients who bring with them additional assets to invest. Merrill began focusing on the sports industry three years ago when it created a dedicated sports and entertainment group. Clients in that unit account for about $40 billion in assets, according to McGauley.
As part of the new partnership, Merrill will relocate some of its 641 assigned sports and entertainment wealth advisors to the IMG campus, he said. They will host lessons from parents and students and simulations that show students what it's like to invest in a real financial market.
IMG has a boarding school, camps, college recruiting services and online coaching for student-athletes as they prepare for college and careers in sports. The new program with Merrill will expand the curriculum to offer students self-study materials and one-on-one meetings with financial advisors.
“We hear a lot of questions about financial opportunities for student-athletes in schools, beyond scholarships,” said IMG Academy Chief Executive Officer Brent Richard. “At this point, financial literacy is the other piece of the puzzle. Our job is to prepare them for college and for life.”