Millionaire Athletes - They're Just Like Us

Is it possible to feel bad for someone who gets paid millions of dollars to play a game?

If you read through the comment section of any article discussing Saquon Barkley’s contract situation, you will find many people sympathizing with him. On the surface, it seems ridiculous for people to have these types of feelings, but we are all human beings, and we feel a connection to another’s plight, regardless of status. I’m always looking for practical applications of things, so read on to see how we can learn from his circumstances.

The Situation

For non-football fans, Saquon Barkley is a running back for the New York Giants. He was a highly sought-after prospect out of college and is currently up for a new contract. The Giants gave him the option to accept a guaranteed one-year $10 million contract or to negotiate a longer-term deal. The “problem” is two-fold. First, football is a violent sport, so one-year contracts are unappealing to superstars looking to lock in value due to the prevalence of injuries. Second, the running back position is relatively underpaid due to how teams perceive the importance of having a star occupying that roster slot. Barkley had the opportunity to sign longer-term deals, but he wanted to bet on himself, so he declined.

Comparing Yourself to Others

Humans tend to compare themselves to others. This is sometimes referred to as “keeping up with the Joneses.” In Barkley’s case, his teammate, quarterback Daniel Jones (wow, that last name fits perfectly with the message), just received a massive contract from the same organization looking to save costs on Barkley. I think he is realistic enough not to expect quarterback money, but envy has undoubtedly crept into his mind during this process. This is not unlike one of us being comfortable in our career yet coveting a neighbor’s car, house, or boat. All that should matter is where we are relative to our goals.

Don't Fight the Market

The free market determines the value of a product or service. Barkley appears to have grossly overestimated the amount of money that teams around the league are willing to pay running backs. I won’t go into the X’s and O’s of this, but other running back contracts should have provided a clue to him and his agents. We might think that our house should sell for a certain amount. Or that our company stock should increase in price based on favorable financial reports. In a world of supply and demand, it pays to listen to the market while making financial decisions. Don’t fight it.

Bet On Yourself...But Beware

Betting on yourself can be lucrative, but it also entails risk. We’ve seen athletes in similar situations parlay an expiring contract with a career year to ensure generational wealth for them and their families. The very nature of risk is that you are willing to accept unfavorable outcomes in anticipation of outsized returns. Betting on yourself is one of the surest ways to accelerate your career growth. But beware. Joining a start-up or accepting a lower-paying job in a company with greater advancement opportunities is not a slam dunk. Take calculated risks. 

Conclusion

I am part of the contingent that feels bad for Barkley. He has been an ideal teammate and face of the franchise. He puts his body on the line and has suffered injuries as a result. There is no opportunity for me to have his ear to impart wisdom, but that doesn’t prevent me from having similar conversations with clients. After all, we are all going through the same stuff.

Author: David Rath, CMT, CFA

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