CFI Blog

An Open Letter to MLS 2013 First Pick Andrew Farrell

Congratulations to Andrew Farrell of the University of Louisville for being the #1 draft pick in the 2013 Major League Soccer SuperDraft. You’re the second straight Andrew to be chosen first in the draft, and you’re going to get a lot of opportunity and a lot of scrutiny.

If you’ve paid attention in the past, you know that sports stars aren’t always the greatest at managing their money. Tales of financial woe range from Allen Iverson to Warren Sapp to Michael Vick. Footballers aren’t immune, either. Look at how Ipswich’s Michael Chopra (as a Colchester United fan, it’s hard to even type that team’s name without uttering a curse) has tied himself into a knot with his gambling problems and wastefulness.

You’re at the beginning of a promising football career (the round, not the oval type), but don’t let it all go to your head. At this point, you have a lot of potential, but, one thing is for sure, your financial future is not guaranteed.

Let’s look at your predecessor, Andrew Wenger. His guaranteed salary last year was $202,000. While that’s good money, you can’t retire on that.

I have no idea what his endorsement contracts might have amounted to, but let’s assume that he got another $100,000 for endorsements. You were part of the Adidas:generation team, so this may already be taken care of for you.

So, I’m going to assume that you’re making about $302,000 out of the gate. It’s going to be tempting to go buy a nice house and a nice car and all of the things you didn’t have while you were in Louisville.

Don’t jump on the hedonic treadmill. You now have a salary and are going to get media attention that you didn’t get even when you were a star at Louisville. Keep your head. Buy something nice to reward yourself, but don’t go crazy.

Plan, from day 1, for the day when you’re no longer a footballer. The average lifespan of an MLS rookie is 2.5 years, and few players make it past 7 years. So, think of other things that you can do to both increase your marketability as well as extend your career. Can you get coaching badges? Can you learn marketing? Can you open up a football academy?

Keep one eye on Europe. From a financial point of view, that’s where the money is. Very few players have done well in the U.S. without going over there. Landon Donovan comes to mind, but compare him to Clint Dempsey, Brad Friedel, and Brad Guzan. Even players who don’t have stellar careers (think Mike Grella of Scunthorpe United) probably do better financially than their counterparts in the MLS. The MLS is a great league and a great place to start. Even if you go start to finish in the MLS, it won’t be a bad thing, but keep your mind and eyes open to the possibility of playing in Europe eventually.

Max out your MLS 401(k) contributions. You can afford it. The MLS will match up to 3.5% of your contributions, and their 401(k) plan ranks fairly well, according to Brightscope.

Don’t get into debt and pay off any loans you might have had. You probably got a scholarship at Louisville, so you may not have student loans, but if you do, pay them and any credit card debt off. Don’t fall back into the same trap again. It might be tempting to get a car loan because of your new salary or to buy a house, but there is no such thing as “good debt.” I know you probably think that you’re going to play for the Revolution forever, so you may be thinking about buying a house, but chances are, if you do well, you won’t be a Rev for the rest of your career, and if you have a house there, you might have trouble selling it later down the road. Rent while you have a playing career and then, if you want to buy when you settle down after you stop playing, you should have enough saved up.

Also, don’t fall for any investment schemes people may present you with. Now that you have a great career, “friends” and “family” are going to come out of the woodwork with a ton of great (sarcasm intended) business ideas for you to take part in all sorts of wild schemes like pork snout futures investing or lint importing. Don’t fall for it. Stick to the basics, keep it simple, don’t invest in crazy ideas, and don’t pay a ton of fees or front loads, as those are a silent killer to your retirement portfolio.

Remember, you’re going to make a lot of money, but there’s also a decent chance that you won’t have made enough in your playing career to retire on. The MLS is not the English Premier League, where salaries are astronomical and you would have a good chance of earning retire-for-the-rest-of-your-life money if you were a star there. However, you can get a really good leg up on the rest of your life and make sure that you don’t look back on your playing days and wish you would have saved more. You’ll be in a stronger negotiating position down the road when other opportunities present themselves if you have a good financial footing.

I know. This was unsolicited advice from a random football fan who would much rather that you come play for FC Dallas or go play for Colchester United. However, if you like what you read, you can always contact me.

I wish you luck in your career. I hope you rip the old onion bag a ton, make a late push for the U.S. team, and score goals for us in the World Cup too. I just hope you get a goose egg when you play FC Dallas.

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John Davis
John Davis is a nationally recognized expert on credit reporting, credit scoring, and identity theft. He has written four books about his expertise in the field and has been featured extensively in numerous media outlets such as The Wall Street Journal, The Washington Post, CNN, CBS News, CNBC, Fox Business, and many more. With over 20 years of experience helping consumers understand their credit and identity protection rights, John is passionate about empowering people to take control of their finances. He works with financial institutions to develop consumer-friendly policies that promote financial literacy and responsible borrowing habits.

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