The NCAA recently announced a series of reforms aimed at enhancing the benefits provided to college athletes. These changes, effective August 1, 2024, include expanded health care coverage, increased mental health support, academic guarantees, and a variety of other support systems. These initiatives, known as “core guarantees,” mark a significant step forward in recognizing the multifaceted needs of student-athletes. However, one particular area of emphasis—financial literacy—deserves special attention due to its critical importance in the lives of both current and former athletes.
New Benefits and Core Guarantees
The reforms come after the NCAA Board of Governors and Division I members adopted new rules to deliver more comprehensive benefits. These include:
- Expanded Health Care Coverage: Schools must provide medical coverage for athletically related injuries for at least two years post-graduation and cover out-of-pocket expenses during an athlete’s career.
- Academic and Career Support: Degree-completion funds will be available for up to 10 years after eligibility ends, along with career counseling and life skills development, including mental health, strength and conditioning, nutrition, and more.
- NIL and Financial Literacy: A new name, image, and likeness (NIL) resource center will be established, offering increased opportunities for student-athletes to secure NIL deals. Importantly, financial literacy is emphasized as a critical area of education.
These core guarantees ensure that all Division I athletes receive a baseline level of support, marking a historic shift in the NCAA’s approach to athlete welfare. As NCAA President Charlie Baker noted, “Today’s progress was made possible by DI membership committing to these investments and by student-athlete leaders leading the charge for these long overdue changes.”
The Importance of Financial Literacy Training
While the array of benefits is broad, financial literacy training stands out as particularly vital. Here are a few reasons why it is so crucial for current and former student-athletes:
- Navigating Complex Financial Landscapes: Many student-athletes suddenly find themselves with significant income through NIL deals. Without proper financial education, they may struggle to manage this newfound wealth, leading to poor financial decisions. Understanding taxes, investments, savings, and budgeting can help them secure their financial futures.
- Preparing for Life After Sports: A career in professional sports can be short-lived. Financial literacy equips athletes with the skills to manage their finances, invest wisely, and plan for a career transition. This is especially important given the statistic that a large percentage of athletes face financial difficulties after retirement.
- Avoiding Financial Pitfalls: The financial landscape is fraught with potential pitfalls, including predatory lenders, scams, and poor investment opportunities. With financial literacy training, athletes can learn to identify and avoid these dangers, protecting themselves and their assets.
- Empowerment and Independence: Financial knowledge empowers athletes to make informed decisions about their money. This independence is crucial for their overall well-being, allowing them to confidently navigate financial challenges.
- Supporting Family and Community: For many athletes, financial success is an opportunity to support their families and give back to their communities. Financial literacy ensures that they can do so responsibly, creating a positive impact that extends beyond their personal lives.
As the NCAA implements these reforms, the inclusion of financial literacy training highlights a growing recognition of the diverse needs of student-athletes. It’s not just about their physical health and academic success but also their financial well-being. By equipping athletes with the knowledge and skills to manage their finances, the NCAA is setting them up for success both during and after their athletic careers.
These new NCAA reforms are a welcome advancement for student-athletes, offering them comprehensive support in various aspects of their lives. Among these, financial literacy training is particularly crucial, as it empowers athletes to navigate complex financial situations, prepare for life after sports, and make informed decisions. As these changes take effect, they represent a significant step toward a more holistic approach to athlete welfare, ensuring that student-athletes are well-prepared for the challenges and opportunities that lie ahead.