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The Secret of Finance: The Weapon that helps NBA Rookies Forge Lasting Careers

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Establishing proper financial habits is the most understated aspect of developing young talent in the league

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Golden State Warriors v Los Angeles Lakers Photo by Yong Teck Lim/Getty Images

As we turn our attention towards the NBA draft, all eyes shift to a class littered with potential. From LaMelo Ball to Anthony Edwards and James Wiseman, each potential candidate is carefully vetted by countless scouts, television analysts and radio personalities using quantifiers like wingspan, leaping ability, catch-and-shoot percentages, ball-handling, lateral speed and basketball IQ.

However, an oft-forgotten measure in evaluating rookies can’t be weighed by breaking down film. It can’t be analyzed in interviews and it isn’t on display in predraft workouts.

How will these bright young stars handle the burden of imminent wealth?

The most undervalued skill in forging lasting success for young NBA players comes from building a foundation of habits off the basketball court. One of the most critical habits that often goes overlooked is a player’s financial habits.

Establishing proper financial habits is the most understated aspect of developing young talent in the NBA. Terms such as ‘tireless worker’ or ‘first guy in the gym and last one out’ are sometimes embedded in a player’s breakdown to replace this integral measure. These terms still only qualify a player’s habits as it relates to basketball.

And yes, time in the weight room and on the practice floor is critical to growing one’s game but so many other aspects of a player’s development go unnoticed through the early years. Financial habits are often overlooked as a means toward proper development, and yet they have helped superstars like LeBron James and Chris Paul put together illustrious careers. Both are well known for the immense resources they place in nutrition, fitness, and recovery.

Rookies aren’t alone in this journey. The NBA has strategically planned for multiple seminars during the season, the most well known of which is the Rookie Transition Program.

Greg Taylor, Senior Vice President of Player Development to the NBA explained to me the diligence the NBA places in educating its rookies.

“We run several programs, including the Rookie Transition Program. It’s the one that we’re most known for and one of the central focuses of that program is financial literacy. We (also) have consistent touch points throughout the year, team awareness meetings in addition to formal and informal programs.”

These educational opportunities are the bedrock for stability in a player’s life that allow full concentration to attack the court without distraction. For some, these critical lessons lead to long and prosperous careers. For others, failed handling of assets can result in disaster.

Here are the stories of several NBA athletes who dealt with the challenges of wealth and how they responded.

The Art of Saving

Aaron Holiday

The last thing any 19-year-old probably wants to discuss minutes after becoming a draft selection is financial planning. And yet, that time-consuming measure will have effects that will carry over for a player’s entire tenure.

To a casual fan, the three-year, $6.5 million contract signed by Indiana Pacers guard Aaron Holiday should set him and his family up for life.

Properly assessing that deal’s actual value and then creating a budget around it will not only ensure lasting quality of life, it allows the No. 23 overall pick in the 2018 NBA draft a method to provide the essential tools he needs to grow his game and his body.

“When rookie athletes sign their first contract they typically expect to receive the salary listed on the agreement.” popular NBA financial advisor Justin McCurdy explained. “Players quickly realize that’s not the case. There are taxes and withholdings, NBA escrow, professional service fees. By the time the athlete receives the funds the net income looks much different than the contract value.”

McCurdy serves a variety of NBA, NFL, and MLB athletes at every level while serving as Executive Director to Manhattan West Asset Management, including Holiday.

“Rookies are young,” McCurdy continued. “They might not be as interested in financial literacy conversations. That’s the main challenge, especially because these guys are so busy. It’s my job to help young players understand the importance of financial knowledge, and to empower them to properly manage their finances. Our team makes financial education mandatory for our clients.”

While NBA fans may gloss over the long term ramifications of failing to make a plan, immediate expenses players can invest in reap undeniable benefits.

“Physical fitness, nutrition, great professional management team. That’s money well spent.”

For Holiday, that level of organization comes effortlessly. Armed with a foundation in NBA brothers Jrue and Justin, Holiday eased into the NBA. The transition can be a bit bumpier for those less fortunate.

“The problem with professional sports is that these guys brought in are babies,” Holiday’s trainer and former New Orleans Pelicans consultant Mike Guevara told me. “They’re still in their infancy in terms of learning basic, adult responsibility.”

A player like Holiday separates himself with work ethic off the court. In addition to individual offseason workouts with Guevara, he invests his time in expanding his financial power which can only make focusing on basketball easier.

“I just know he’s (Holiday) tough,” Guevara said. “He doesn’t crack under pressure. He’s a juggernaut.”

That confidence translates to every aspect of his life and is critical to making him look like a late-round steal two seasons into his career.

“I’ve always been good at saving money, but going into my second year I wanted to do more than just save money,” Holiday said. “I wanted to learn about investing in stocks, bonds, and real estate. Justin has done a really good job at keeping us educated throughout the process. He breaks down each investment and explains what exactly our money is going into.”

Financial planning as a tool is immensely more valuable than the simple peace of mind it provides. In a 2016 penned article in Business Insider, it was reported LeBron James spent $1.5 million taking care of his body. This is one of the leading causes for his continued success despite nearly 60,000 total career minutes played.

“Where a lot of people don’t do it, he puts a lot of money behind taking care of his body,” Mike Miller said of James in 2016 via Bleacher Report. “A lot of people think it’s a big expense, but that big expense has allowed him to make a lot more money for a long period of time.”

Careful and conservative financial planning will be critical if Holiday and others like him hope to match that same level of dedication over the course of their careers.

“Aaron understands the value of staying in shape during the off-season,” McCurdy said. “He’s included training and recovery in his budget and has hired well-respected coaches to lead his fitness program.”

Investing in Yourself

P.J. Washington

Charlotte Hornets rookie forward PJ Washington is another example of a player who’s on-court success has been closely matched by his work off of it. Washington recently earned Second-Team All-Rookie honors for a standout season that saw him finish with 12.2 points, 5.4 rebounds and 2.1 assists per game, including a 27-point introduction in his first career game.

Washington talked about his relationship with former Kentucky Wildcat teammate and current Miami Heat star Tyler Herro and the difficult economic conversations they’ve had this season.

“It’s hard to talk about life after basketball because basketball is present right now. When we do get a chance to speak, I definitely pick his brain. He’s excited about what’s going on for him and the Heat. He also looks into life after basketball. Basketball is only going to be basketball for so long. We have to find ways to make wealth off the court and continue to live the quality of life we have.”

For his part, Washington has put that plan into action becoming the first athlete to sign with SportBLX. SportBLX is an investment platform that allows fans anywhere in the world to own shares of unique assets in sports. P.J. Washington marks the first time the public can invest alongside a professional athlete in an alternative asset class. At the price of $200, fans can forge a partnership with Washington, enjoying success as he does.

“I’m trying to build as much money on the court as off. I want to make a lot of money off of it so that I’ll be able to live off of that. This is a great way for me to build wealth throughout the rest of my life.”

A Battered Brand

Lonzo Ball

New Orleans Pelicans former No. 2 overall pick Lonzo Ball is no stranger to shaky investments.

In a conversation with teammate Josh Hart on The Lightharted Podcast, Ball confessed he’d switch out his Big Baller Branded kicks between quarters.

“Them ZO2s I was playing in, they was not ready,” Ball explained. “No one knows this, but D-Mo had a backpack, and he had like an extra four pairs of shoes in there, because I had to switch them every quarter because they would just rip.”

Ball exited Big Baller Brand after losing $1.5 million to the investment and to co-owner Alan Foster. While Ball didn’t accuse Foster of stealing the money directly, he did have strong words for his former partner in an article published by ESPN.

“(He) used his access to my business and personal finances to enrich himself. As a result, I have decided to sever all ties with Alan, effective immediately.”

Since that time, his evolution has continued though it hasn’t come without its share of detriments to his playing career. The 2017 No. 2 overall pick missed 65 games in his first season due to lingering ankle concerns and struggled so badly early on with the Pelicans that he was benched in favor of undrafted forward, Kenrich Williams.

The bond that Lonzo and Zion formed early helped Zo experience his best play in the latter part of the 2019-20 season though. Still, nagging concerns with representation forced Ball to switch agents twice in the past year. After moving on from Harrison Gaines in favor of CAA, Ball again switched to Rich Paul of Klutch Sports on September 14.

“I wanted to lead my career,” Ball told ESPN’s Malika Andrews.

Can Lonzo’s underwhelming performances over his first three seasons be traced to off-court distractions and poor economic decisions? Regardless of past missteps, Ball appears to have taken his career and his financial responsibility back with the hiring of Klutch Sports. Armed with one of the most highly respected agents in the NBA, Ball can get back to focusing on basketball.

Having the proper team and financial structure in place can prevent these types of unsettling distractions that could be pointed to for at least partial cause behind what could be conceived as an underachieving first three seasons.

“Our team has an extremely high bar of the investments that we’re willing to approve,” advisor McCurdy said. “We scrutinize every aspect from the leadership team, financial statements, history, current valuation.”

Having that level of reinforcement around can be the difference between a solid investment and a costly one, both financially and mentally. The stresses that come from these decisions and the manner in which they can affect on-court play can’t be understated.

Building a Bond and Mental Health

Zion Williamson, Aaron Holiday, Lonzo Ball

Zion faced his own share of disappointment following a torn MCL the number one overall pick suffered just days before the start of his rookie season. That, coupled with endless minutes restrictions plus endorsements deals with Jordan, Gatorade, Mountain Dew, Mercedes-Benz, Panini America, Beats by Dre, 2K and others may have taken a significant toll on a 19-year-old already shouldering a significant burden.

“For Zion,” Kleiman continued, “I’m sure that these brands fit very comfortably. I’m sure CAA’s done a great job in finding brands that represent who he is. (They will make sure his) required time doesn’t get in the way of what he needs to do for basketball.”

How comfortable can that growing number of commitments be for a young player just one year removed from high school? Having the proper foundation and planning can help ease some of that stress so that a player like Zion can refocus his efforts on returning to the basketball court.

“Lonzo went through a similar situation so he knows what I am going through right now and he is giving great advice on how to handle it,” Zion said on ESPN+ “The Rooks.”

Days before the NBA’s seeding tournament was to begin, Zion left due to a family emergency. When he returned, he appeared out of shape and was once again relegated to significant restrictions. The Pelicans went on to post just a 2-6 record despite the league’s easiest remaining schedule.

Holiday’s trainer Mike Guevara conveyed the toll a growing number of distractions can make on a player.

“We call it noise. If you can limit that noise, the more attention you’ll be able to pay toward the session which is to get better physically.”

The ‘noise’ Guevara mentioned can be glossed over by NBA fans and perhaps even by peers. Those ‘distractions’ as financial advisor McCurdy referred to them as can sometimes prohibit players from seeking aid from the stresses not just as they pertain to the floor but the stresses that come from finances as well.

“There’s a misconception that players get unlimited free tickets,” McCurdy assesses when describing just one of the many factors that distract players that most fans don’t think about. “Most spectators assume that every player has free access to tickets. That’s just not the case. Usually, players will get two to four tickets depending on whether it’s home or away and the rest are taken out of their paycheck.”

This isn’t to suggest NBA athletes ticket expenses can lead to emotional trauma. It’s only one example of the growing number of monetary responsibilities that can ultimately overwhelm a young athlete.

Players must find peers as well as advisors who can help them navigate their financial path. The NBA has responded by making that a priority, specifically with its younger players navigating their newfound financial wealth.

The NBA is doing its part to bring attention to these potential concerns. However, the words of superstars such as DeRozan and Love have changed the conversation all on their own.

“One of the things we’re super proud to be a part of is the Mind Health Program,” NBA VP Taylor said. “(But) you know about the guys like DeRozan, Love, Jahlil Okafor, Gordon Hayward, Paul George and Justise Winslow; they’ve been clear about needing and reaching out for help to navigate the off-court pressures. I credit the players for recognizing the support network helps them to navigate the anxiety, stress and depression that comes from such a highly pressurized environment.”

Both Durant and LeBron opened up about how their bond helped them as well as their path to financial growth in a recent episode of ESPN+ “The Boardroom” hosted by Jay Williams and Kleiman.

“I didn’t have anyone to help me along the path,” LeBron said. “I want the ones who come after me to learn what I’ve been able to accomplish.”

“It’s been amazing,” Durant said referencing James. “You see a guy who’s willing to bring other guys with him and say, ‘We can all shine together.’ That just sends a great message to guys like myself.”

Lonzo reiterated something similar of Zion on ESPN+ The Rooks.

“Zion can come to me for anything,” said Ball. “It doesn’t have to be basketball-related.”

Forging those bonds are critical to a young player’s financial and emotional success. These habits and the support system they create can protect and strengthen a young player and ultimately lead to a better on-court product.

“Mental health, mental wellness has been a hot topic and it should be,” McCurdy explained. “Any clients that may have challenges, everyday stress that many people don’t understand. I (always) encourage those athletes to seek help.”

A Lasting Foundation

Much was made of NBA athletes plight in ESPN’s infamous 30 for 30 special, “Broke.” In it, the financial failures of well known athletes frame the horrors that can accompany mismanagement and an unwillingness to curb spending. ESPN claims 60 percent of NBA athletes are ‘broke’ within five years of retirement, a number that hasn’t been verified by a reputable source.

Regardless, an additional benefit of financial planning that the NBA and McCurdy strongly encourage is in giving back. The NBA focuses efforts in the community with its NBA Cares initiative, but players like Holiday and Washington make individual contributions as well. Allowing for a budget allocates the ability to reserve funds for giving to powerful causes such as Children’s Bureau, Preemptive Love and Madi’s Treasure Box, three foundations Holiday regularly contributes to.

LeBron’s “I Promise School” is well known. You may also remember Zion paying the lost salaries of Smoothie King Center employees following the abrupt season suspension as a result of the coronavirus.

Holiday’s brother, Jrue of the New Orleans Pelicans, even donated his entire bubble salary to the African American business community through the Jrue and Lauren Holiday fund.

Having the kind of financial clarity necessary to make these kinds of gestures can only improve emotional well-being and one’s balance on the basketball court.

“Most players can’t play well if they’re sad or upset or if they’re emotional,” McCurdy said. “When they’re not calm, cool or collected, they don’t perform well.”

In 2008, a Harvard-based study concluded that ‘giving makes us feel happy.’ This is yet another important tool towards a lasting NBA career.

Eyeing the Investment

Rich Kleiman, Kevin Durant

Once a young NBA superstar has their financial affairs in order, they can begin focusing on building their business beyond the game of basketball. That partnership takes shape in many forms whether it be investments or endorsements.

Finding sponsors that helped fill Durant’s pockets came too easily. Manager Rich Kleiman and co-host to ESPN+ “The Boardroom” told me that working with so many different partners began to feel ‘inauthentic.’ It was time for Durant to evolve from superstar athlete to businessman.

“About five or six years ago when Kevin was at an all-time high in brands he was working with, we really just felt like there was shift in the climate,” Kleiman told me. “Being able to be a pitchman for so many brands wasn’t authentic and it wasn’t believable. It just wasn’t in line with what he wanted for his business. We started shifting to brands we looked at as partners. That’s an evolution.”

An agreement with Sport BLX fits the mold of both endorsement and long term investment for P.J. Washington. Though he doesn’t boast the same visibility as Durant does playing in Brooklyn, Kleiman reminded me there are plenty of opportunities for young athletes to make savvy investments in any situation.

“Your business takes on a different iteration in those markets, but there’s still the opportunity to invest in real estate, invest in different businesses that are more relatable to the region you’re in.”

Luckily for Washington, he already has an idea of what to target next.

“Car dealerships. I fell in love with that idea when I was young. My dad used to work at one. He would bring home different cars pretty much every other day. I fell in love with it at a young age. I always wanted to be involved with it. That’s something I want to invest in. Having my own car dealership.”

Having a long term financial goal can further motivate a young player, something McCurdy goes over with his clients. A powerful ‘why’ such as Washington’s desire to achieve what appears a life long dream should only make him a better basketball player.

“I like to gamify the goal-setting process for my clients,” McCurdy said. “A savings goal per year, a charitable goal and then long term goals around health and family. I show them their progress and get their competitive juices flowing.”

Lasting Advice

It’s easy to overlook the challenges young athletes face seconds after being drafted. The work on the court isn’t enough. The level of dedication beyond basketball is what carves out a lasting career and life. For each world-class athlete like LeBron who puts in the work at every level year after year, there is the underwhelming athlete who fails to meet expectations due to financial hardships, distractions and the stresses that accompany them.

“Athletes who have their personal lives in order usually have more success on the court,” McCurdy concluded. “A player can approach their artistry with a heightened level of focus If they can eliminate the stress associated with being in financial trouble.”

For teams looking to land the most promising talents in the draft, measurables are vital but how they handle their financial habits will be just as critical in creating lasting success in the league.

For more Pelicans talk, subscribe to The Bird Calls podcast feed on iTunes, Spotify, Stitcher or Google Podcasts. You can follow this author on Twitter at @PrestonEllis.