Current Trends - Estate Planning for College Athletes in the NIL Era - Episode 190
- Jenny Rozelle, Host of Legal Tea
- 3 days ago
- 7 min read
Hey there, Legal Tea Listeners – This is your host, Jenny Rozelle. Welcome back for another episode, which is a “current trends” topic where we talk about things going on currently that are relevant and pertinent to my estate and elder law world, and/or maybe things I’ve seen on the news or stumbled across on social media. Well today’s episode, we are going to dive into the increasingly important world of estate planning for college athletes in the Name, Image, and Likeness (or for short, NIL) era. When the NCAA rules changed a few years ago to allow athletes to profit from their NIL, young college stars have been signing deals worth thousands—sometimes millions—of dollars. But with this newfound wealth comes responsibility and questions many young athletes aren't prepared to address like:
- How should you protect these assets?
- What happens to your NIL deals if something unexpected occurs?
Today, we are going to explore why estate planning is not just for the older and wealthy, but a critical consideration for the young even and for this episode, for college athletes, suddenly managing significant income streams and more money and assets that traditionally college-aged individuals have.
In the summer of 2021, like late June/early Julyish, the NCAA adopted, what’s called, the “name, image, and likeness” policy – what this means, according to a CBS News article on the new rules, is that college athletes will be able to get paid for doing things like autograph signings, endorsements, and doing appearances. In their press release, the NCAA clarified that the new policy does not allow quote pay-for-play” – meaning they do not allow for college athletes to get paid for merely playing their respective sport. This historic change came after decades of restrictions that prevented student-athletes from monetizing their personal brands while universities and the NCAA profited substantially from their performances. Now, it is important to know that the rule changes were not really … let’s call it … voluntary—it was caused by mounting legal pressure, state legislation across the country, and court cases that were scrutinizing the NCAA's compensation restrictions.
Fast forward to today, and the NIL landscape has transformed dramatically. What began with somewhat modest social media endorsements and local sponsorship deals has evolved into like a marketplace with multi-million dollar contracts, dedicated NIL initiatives affiliated with universities, and professional management teams advising young athletes. Top college stars in football and basketball now routinely command seven-figure NIL packages, while athletes across all sports find opportunities to monetize their personal brands. However, this rapid evolution has created some disparities, with the highest-profile athletes capturing a large share of NIL revenue, while legal and regulatory frameworks struggle to keep up. Schools now openly leverage NIL opportunities in their recruiting pitches, and the distinction between legitimate NIL compensation and improper recruitment incentives remains blurry, presenting ongoing challenges for athletes, universities, and regulators alike.
Since I’m in Indiana AND because I’m an annoyingly huge Butler basketball fan, I’ll use Butler basketball as an example of all of this. So when we talk about the impact of NIL rules, it's fascinating to look back at moments like Butler's magical 2010 NCAA tournament run through today's lens. Gordon Hayward—a hometown hero from Brownsburg, Indiana—became a household name during Butler's incredible journey to the National Championship game against Duke University, which was held in Indianapolis – where Butler is. That near-miss final shot of Gordon Hayward that painfully rimmed out not only broke Bulldog hearts but also represents a perfect case study of what NIL could have meant for athletes of that era.
Under today's NIL rules, Hayward's moment would have translated into significant financial opportunities. Following that tournament run, his popularity in Indiana skyrocketed—he was the local star who nearly toppled Coach K's Duke dynasty on home soil. In today's NIL environment, Hayward could have capitalized on his newfound fame through local business endorsements, paid appearances, autograph sessions, merchandise sales, and social media partnerships throughout Indiana. What makes this example particularly powerful is the perfect alignment of factors: a local athlete, attending a local university, playing in a championship game in his home state, with a moment that captivated the nation. Before 2021 and the change of the NCAA rules, Hayward was not permitted to monetize any of this attention or goodwill while in college. Today's athletes in similar breakthrough moments can immediately translate athletic achievement into financial opportunity.
So how does all of this NIL and NIL money relate to my world?
The NIL era isn't just creating opportunities for modest earnings—it's generating legitimate wealth for top collegiate athletes. A while ago, I saw a tweet on Twitter (or X, now) from a Joe Pompliano – whose Twitter bio states he “breaks down the business and money behind sports.” Anyway, Joe shared that according to estimates, that Reggie Bush, a former football player – who famously played at USC … got the All-American honors twice … received the Heisman Trophy as the most outstanding player in the nation. Anyway, estimates claim that Bush would have earned somewhere between $4 MILLION and $6 MILLION annually with these new NCAA rules So, that’s just one example; that, this isn't pocket change or spending money; these are life-changing sums that require serious financial planning and I would argue … estate planning.
What makes this new reality so significant is how rapidly it's evolving. Universities are already formalizing internal policies to help their student-athletes navigate NIL opportunities, recognizing this isn't just a passing trend but a fundamental and HUGE shift in collegiate athletics. And while this conversation often centers around household names and football or basketball stars, the implications reach across all collegiate sports where athletes with strong personal brands or compelling stories can now monetize their collegiate careers. The outcome of these rule changes extend far beyond just allowing athletes to earn money while in school. It creates an entirely new category of young wealth earners who may suddenly find themselves managing significant assets without the financial literacy or planning infrastructure to protect them. These aren't just college students with part-time job income anymore—some are effectively running personal businesses with substantial revenue streams, complex tax implications, and important long-term financial decisions to make at a very young age. This new reality is precisely why estate planning, traditionally viewed as a concern for older adults, now becomes crucially relevant for college athletes in the NIL era.
You see, one of my least favorite questions to get asked is: “When should I be thinking of estate planning? How old are most of your clients?” The answers to those questions are different. How old are most of my clients? A heavy majority of my clients are probably 50+ -- though there are some in their 30s-40s that recognize how important it is to do estate planning (especially if you have minor children!). I say all of that, but estate planning is actually a “thing” for anyone above the age of 18 because that is when you are legally considered an adult. Something happens to you – you fall down the stairs after a late night out at the bars? Maybe you get in a car accident? An accident while skiing…whatever, you get the point. Something happens – guess what? Your parents probably no longer have the legal authority to do much because you’re now an adult and the law treats you as such.
With the NCAA's rule changes allowing athletes to profit from their name, image, and likeness (NIL), we are witnessing the creation of a new class of young wealth earners who face unique vulnerabilities. Like I said, these are not just college students earning some spending money anymore—rather, these college athletes are building significant assets at an age when estate planning is rarely considered. The unfortunate reality is that sometimes, yucky events do not discriminate based on age or athletic ability, creating a really dangerous planning gap for these young college athletes bringing in the dough and making that money … from NIL.
When a college athlete suddenly begins earning thousands or even millions through NIL deals, they enter uncharted financial territory without the safety net that, let’s say, more established earners and older adults typically have in place. Should something happen to these athletes—whether incapacity from injury or even death—the absence of basic estate planning documents could lead to complex legal challenges that extend far beyond the playing field. Their NIL earnings, future contract rights, and accumulated assets could become entangled in legal proceedings at precisely the moment when their families are least equipped to handle such complications. I fear the day something happens to a “big name” college athlete – and they have no estate plan. I hate to be a turd, but it’s going to happen eventually.
Even for athletes who aren't commanding headline-grabbing NIL deals, basic estate planning documents become essential protection tools. At minimum, college athletes should consider establishing a Healthcare Representative designation and Power of Attorney to ensure someone trusted can make medical and financial decisions if they become unable to do so – as in due to incapacity. For those accumulating substantial NIL earnings, more comprehensive planning through Wills or Trusts becomes appropriate to protect and direct those assets according to their wishes. This isn't about planning for a distant future—it's about acknowledging the unique financial position these young athletes now occupy and ensuring their newfound earnings are protected with the same diligence they bring to their sport. That’s really what I wanted this episode to be about.
Alrighty, let’s wrap this episode up, shall we? Next week, we’re back to the “celebrity estate planning” type of episode – and right now, I’m not sure who I am going to dive into. I may end up chatting about Gene Hackman and his spouse, Betsy Arakawa, tragically passing away – and by the time this episode airs, we may know more then than we do now (I’m recording this at the end of February – their deaths passed away just a few days ago), but I may talk about their deaths from the lens of simultaneous death provisions in an estate plan. We’ll see. Maybe I will, maybe it’ll be someone else. So you’ll just have to tune in next week, Legal Tea Listeners, to find out so I talk to you then!
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