We Are Currently Hiring!
We Are Currently Hiring!
John Ray
Live from the studio inside Renaissance Bank, the bank that specializes in understanding you. It’s time for North Fulton Business Radio.
Again, everyone, welcome to another edition of North Fulton Business Radio. I’m John Ray, and folks we are broadcasting as usual from inside Renaissance Bank in beautiful Alpharetta, Georgia. We’ve got a fantastic guest today with us. Erick Murray is with us. Erick is an advisor with Healy Wealth Management, and Erick is going to talk to us about the problem.
Actually, it’s a good problem. The good problem of a big influx in generational wealth, in this case in the form of nil name, image and likeness payments that go to college athletes. We’re going to talk a little bit about that. But before we get to Erick, I just want to remind you that the cure for the mega bank flu, those automated in personal messages and relationship kinds of activities that the mega banks put in front of you to try to keep you happy and keep you from talking to them.
You know those things. Renaissance Bank is the antidote for all that. The folks I refer to, Renaissance, they come back and tell me that Renaissance is big enough to handle pretty much any need you can throw at them from your business, but they’re small enough to deliver their services in a personal way. And that’s the magic combination that you don’t find too many places. But I see it every day in where I’m sitting here in Renaissance Bank, the place to start is to go to Renaissance Bank to learn more and be in touch. Renaissance Bank understanding you remember FDIC and now I want to bring on Erick Murray. Erick again, he is an advisor with Healy Wealth Management. Erick, welcome, John.
Erick Murray
Thanks for having me today.
John Ray
Hey, thanks for being here. Let’s talk about you and your work at Healy Wealth Management. How are you serving folks?
Erick Murray
Yeah. So great introduction. I really appreciate it. Just a bit of what I do over Healy Wealth Management again. I am an advisor over there. We do over there is just help out individuals that are really looking for what the next game plan is, what their next dollar. And so from a financial planning perspective, we just try to see what their long term goals are and where we can best beat and fit them.
Erick Murray
And we do that by one. Having sound financial advice when it comes to the Investment Management Board, having great insurance recommendations when it comes to what kind of insurance needs are there, and also making sure that they have the right kind of state planning documents, whether it’s the will or powers of attorney, we just really try to make sure we’re the all encompassing place for individuals and families to come to with all their big financial challenges and problems.
Erick Murray
And so that’s really what we do at Healy Wealth. And just something that, you know, as an advisor over there really tries to strive to do, be that one encompassing place for any person to really come to for any kind of issues or questions that come up financially.
John Ray
So you’ve got a particular passion for those individuals, student athletes that have come into a change in generational wealth within. I’ll talk about why you develop that passion.
Erick Murray
And that’s a that’s a great kind of segue into it for myself. I grew up in the Buford, Georgia area once at Buford High School, and.
John Ray
That’s all you need to say.
Erick Murray
That’s all that needs to be said there, right? You know, if Buford.
John Ray
High School folks, it puts out Buford spits out a whole lot of great athletes.
Erick Murray
Oh, yeah. And over the last year, they just finished a building that new high school football stadium and.
John Ray
That rivals Mercedes-Benz.
Erick Murray
It is insane over what they got going on. But from a student athlete perspective, it is such a luxury to have. And being at Buford, interacting with student athletes over there on the baseball team, football team, basketball team, there’s a lot of great talent over there, and I was a part of the baseball program over there, and I have two younger brothers that were also very heavily involved in the athletic segment of it as well even though myself, I didn’t go to the next level and play collegiate sports. I have two those two brothers, ones over at Alabama playing football over there, and the youngest one, he went to Georgia Tech to play baseball. And so I’m very familiar with the kind of efforts that I need to go into actually being a student athlete to be successful at the regimen behind it. And so with the NIL coming into play, it creates a great opportunity for these student athletes to one be able to profit off their name, image and likeness and gives their families a great opportunity to say, what can we do with that as well, and what can we how can we be smart with this huge influx?
Erick Murray
And so I think that’s really just where my background stems from. I know the ins and outs of a student athlete. I know what it takes. And so being in the financial planning and being as being a financial advisor as a whole, just being able to give that clarity and guidance to the next generation, that’s really getting a great opportunity that wasn’t there before.
Erick Murray
It’s really empowering and something that I’m very passionate about helping out with.
John Ray
And you understand this math. It’s actually a brutal kind of math, right, where young young men and young women who are in high school, they got their career mapped out right. They’re going to be in college for some period of time, maybe get a degree, maybe not, because they’re looking to the next level, whatever that is. Be a major League baseball, NFL, whatever.
John Ray
And they it doesn’t work out for most.
Erick Murray
Exactly.
John Ray
What are those numbers.
Erick Murray
So when you’re looking at it, if a high school athlete makes it a college and all of those numbers are pretty small, and how many high school athletes make it to a Division one college program? But when you look at the numbers after that into going into professional sport like football, basketball, baseball, professional level, less than 2% of college athletes actually make it to that professional step.
Erick Murray
And so that’s what’s really empowering. And when we’re looking at the NIL as a whole. It’s a great influx. It’s a great place that a lot of these athletes have gone to, especially if you have received these big contracts recently. And so taking advantage of it and also seeing, okay, if the next level doesn’t work out, if I’m not a professional athlete, how can I make what I’m getting right now work for me not only during college, but after that and into the long term?
John Ray
And this is I have to say, this is John Ray’s editorial, folks, if you don’t mind, he said, we’ve got a lot of I’ll just call it get off my lawn attitudes about young people and young people making bad decisions and all this when they have this money that suddenly comes in. But this is a problem across the age spectrum.
John Ray
I mean, we see this with people that win the lottery at whatever age they win the lottery. People that get a big inheritance, that maybe they weren’t expecting that, or even if they were, they didn’t plan for it. And then it’s amazing how quickly that generational wealth can be squandered.
Erick Murray
Yeah, exactly. If you’re not intentional and you don’t have a place for those dollars to go, doesn’t matter if you receive $1 million, $2 million. If you don’t have a system or plan of action in place, you’re going to squander it. And that happens at, like you said, every level, when you look at and bring it back over to athletes, most professional athletes, and particularly in football.
Erick Murray
And there’s an ESPN documentary, 30 for 30, that kind of dives into this statistic. But over 80% of professional football athletes, two years after they wrap up their professional career, they’re on the verge of bankruptcy, they’re already on bankruptcy, or they’re just completely broke.
John Ray
Hold on just a second. So I want to underline what you just said for people, 80% of professional athletes. So these are individuals that are in let’s say that as you said, football. So you’d be talking late 20s, early 30s is generally the retirement age. Correct. Right for NFL. So what you’re talking about is individuals that aren’t teenagers.
Erick Murray
Exactly.
John Ray
They’ve been around. They’ve had the opportunity to mature in a lot of different ways. And yet they still mess it up.
Erick Murray
Yeah, exactly. And like you said it goes across the board. Doesn’t matter if you’re right out of college, you’re entering into retirement. This can happen to anybody. And just knowing what to do when that happens if it were to happen is very important.
John Ray
So let’s talk about the psychology of this. Because this is so common when there’s generational wealth and but generational wealth, we’re talking about some big influx of dollars of game changing kind of money that you may or may not have been expecting, but is likely a spike relative to what you’re year by year. Income is going to be over your lifetime, right?
John Ray
So that’s what we’re talking about. But when you have something like this happened, the psychology of it again is quite common. Is it not that you weren’t ready for it. And the other thing is, how do you talk to someone who needs to get ready for it? But they’re caught up in, like I’ll say, the excitement of it. Right when they see all those zeros, they go to the ATM.
Erick Murray
They see all those. Exactly. Yeah.
Erick Murray
And I think that’s where having a professional team, having a financial advisor or a planning team around, you can really help make those decisions a bit easier. That’s something that we do at Healy Wealth. If you were to get a big influx of money or a big inheritance, will be kind of do is figure out what are your goals for the future, what are you trying to accomplish, and kind of break that down and provide you a financial plan that kind of suits what you’re looking to do, whether it is building up an emergency reserve because you are getting this big one time inheritance and making sure you have that cushion if the unknown happens, and then also deploying those dollars in different places to one set yourself up, but also your family members up. I think that’s a really big, important part and piece into it. And usually when someone receives a big lump sum of money, those decisions can get very overwhelming. But I think just breaking it down, seeing the smaller steps to get to that bigger picture is what’s really important, and something that we try to strive to help people out to do.
Erick Murray
And what we’ve done for a lot of our clients at Healy Wealth.
John Ray
Yeah, the the ATM thing, that’s actually a true story based on a true story, because I knew a country music star in their situation, who they kept as much money as a checking account as they could, so they could go to the ATM and just look at the ballots. Now, that’s not a great way to handle.
Erick Murray
A diamond, I would agree. Yeah.
John Ray
So it’s not about it’s about what those funds can do for you over the long haul.
Erick Murray
Exactly.
John Ray
Say more about that.
Erick Murray
I think what you need to do in that kind of situation is you got to divide it out. You got to look at what are your short term goals, look at what do you want to do with the next 1 to 5 years? Is there a big purchase that you’re looking to come into, or are you looking to buy a new car? Are you looking to be charitable with that money? Figure out what that is in the short term and then looking at the longer term picture 5 to 10 years. You’re looking at upgrading, doing some renovations in your home down the line, and then ten plus years out down the road, especially if you have about 20 or 25 years until you’re reaching retirement. What are the best places to put that money and not even think about, and let it compound your over year to set yourself up to where you’re not having to actually do so much later on down the road. You’re already saying yourself up right now and laying the compounding work in the background. So I think it’s just important to see where you are today and how we can best meet you down the line and kind of help that vision and goal come to fruition now.
John Ray
Erick, how do you talk to someone who they’ve just made a big deposit and they’re like, oh, this is fine. I appreciate all this long term stuff. But I got to enjoy my wheels, man, right? I’ve been working hard to get to this point, and I want to enjoy some of the fruits of this. So how do you talk through talk that through with someone and that balance between kind of the near term satisfaction they’d like to see from that money and then the long term benefit of savings.
Erick Murray
So it really comes down to time perspective, right. If we’re looking at someone that is 30 to 35 years out, probably someone that’s in that college age, that’s in the NIL space, the amount of money that they need to put away to not necessarily think about later on down the road is going to be a lot less versus someone that’s in their 50s and 60s that are looking at retirement a couple of years down the road, and they might not have that nest egg or that retirement fund built out to where they need to be.
Erick Murray
So it’s just really understanding where they’re at today and what their time horizon looks like. But at the end of the day, John, you do want to enjoy the fruits of your labor. And so just also emphasizing, hey, we’ve done a lot of great work. And usually when we have these conversations with our clients, especially if they’ve been with us for a couple of years and they have made a lot of great progress, it’s important to also take a step back and say, have you actually been enjoying the other portion of the money that we haven’t been saying aside, have you been going on those trips that you planned or being able to go out and buy that new car that you wanted to purchase, or what’s the holdup? Why are you decided to put that off? Because your plan, we have that baked in. But I think it’s also a mindset thing. It’s, hey, I want to save, I want to invest. But it’s also important to have that kind of balance because you don’t want to burn yourself out either doing more, too much of one thing. It’s never a good thing. So we just want to make sure we bring it back to that.
John Ray
Yeah, that’s great. So what is when you talk about a younger person making long term goals, that can seem a little fuzzy, right. Because the truth of the matter is, and this is true for a lot of young people who have a lot of different interests and they don’t necessarily know at age, I’ll say 20 when particularly when they’re focused on their sport, they don’t exactly know what their career is going to be in age 35 or what they want it to be.
John Ray
Right. And there’s nothing wrong with that way. I didn’t know either. So how do you talk to them about long term planning in that particular scenario? The future? It is for the most part, especially when you’re talking to somebody that young. It’s unknown the career that they might have decided to choose Rafter College. It might not be the same one that they’re in five years down the road, but I think the overall goals of what they want their life to look like down the line, they’re always going to be the same no matter what job, what career that you’re in.
Erick Murray
And so I think Lincoln had the bigger picture trying to figure out a plan that works regardless of where you’re at, regardless of your income levels. Figure out, okay, so if we do have a big change, how do we self-correct? And go back to those main goals that we set up in that initial financial planning meeting? I think it’s really important.
Erick Murray
And obviously those goals can change with time, but also always going back and looking at the bigger picture and how we can best use our resources that we have today to build towards those goals that we’re looking at down the road is really important.
John Ray
Erick is with us folks. He’s with Healy Wealth Management. Erick, I want to talk about some unfortunate things that we all have to deal with. But one of them in particular for student athletes or something they’ve never had to deal with on a regular basis, and that is taxes and keeping records.
Erick Murray
Exactly.
John Ray
And we’re talking about the everyday piece of what’s happening here with that nil compensation, whatever form it takes that you’re receiving. So talk about that piece of it.
Erick Murray
I think that’s one of the most important pieces before we even go into the conversation of saving and investing and saying yourself up for retirement or just goals that you have down the road, it’s how do we set up these big contracts that have given us huge amounts of income? Because these contracts can range from as low as $50,000 up to a couple million dollars. And so when you’re looking at contracts that are in the 500,000 to $1 million range, you’re going to be taxed at a pretty high ordinary income rate. And so when you’re looking at it from the tax planning perspective, it’s, hey, if we’re going to be setting up this deal and we’re going to be setting this, we’re going to be having this in place, we’re going to have to have a structure.
Erick Murray
We’re going to have to have a game plan to pay these taxes because they are going to come. And I think the next big point on it is what’s the best structure to set that up, and whether it’s setting up an LLC or an S Corp for the business, because these to an athletes, they’re basically establishing their own personal brand, their own, they’re pretty much becoming their own entrepreneur.
Erick Murray
And so helping them understand how that works and that income that they’re receiving, they’re not getting any taxes withheld. They’re getting paid as their own business. And so they have to actually pay their taxes out of pocket. And so just looking at that piece, it’s really important. We want to set that aside first before we do anything else, because the IRS is going to want to take their piece. And I think that’s something a lot of student athletes do overlook when it comes to this business.
John Ray
Yeah, because if they’ve had a job, they’re used to the taxes getting withheld.
Erick Murray
Exactly.
John Ray
And that doesn’t happen in a lot of this compensation. Right. So you’ve got a plan for that.
Erick Murray
Exactly. And for most of these deals, most of the contracts, they’re pretty much all set up exactly the same way. We have to set aside your own portion. And not only do you have ordinary income to worry about, but you have self-employment tax to worry about, an extra about 15% on top of your ordinary income rates. And so that’s what we do at Healy Wealth Management.
Erick Murray
We try to help you see that bigger picture and see what is the tax bill look like. How do we coordinate that with your tax. Prepare to make sure that they’re prepared for that as well. And also do the wealth management piece in the financial planning piece around that tax bill that is going to come up next year.
John Ray
So what advice do you give to a student athlete who’s who suddenly has a lot of money and they’ve got suddenly have friends they never thought they had. They have long time old family members that show up from nowhere, right, that have the investment opportunity of a lifetime. I say that with a smirk. That folks get see, but I think they could feel it. So how do you talk to them about that? Because that is I would think that may be the most difficult thing that someone in that position has to deal with. That’s it’s extremely difficult, especially when a lot of these student athletes, when they do receive this kind of income, they come from very humble beginnings, for the most part. And so just knowing that you’re you can be in a situation to help out your family and friends that might need it. It’s also important to put yourselves first. And so that’s why it’s so important to have that team around you that’s able to give you that guidance, give you that advice that you yourself can’t see, or even the people closest around you.
Erick Murray
And I think also at the same time too. It is important to host, be generous and also be able to help others that also need certain kind of financial, some financial help as well. You also want to set yourself up first. That’s the most important thing. You want to make sure that you have your four walls covered before you’re able to really branch out and extend help to others that are in need.
Erick Murray
And so we always try to bring it back to that. We want to make sure that you yourself, you’re the priority. And after that, there are going to be some tough conversations because there are family members that are going to want more than their fair share. And so we just try to help provide that reassurance, emotional support and that guidance in that way that they might not get in any other place within their lives.
John Ray
What this raises is who’s in and who’s on the outside. So who do I need to have as part of my team I’m listening to?
Erick Murray
So when you’re looking at that financial planning team, you’re going to have a couple of different people in place when you’re going to want to have that tax preparer in your corner. So whether it’s a CPA, being able to make sure that you have your tax situation in order, it’s really important you’re going to look at having an estate attorney in place, because you might not think about this, but having a will, having powers of attorney, establishing that business entity for your Nil business as a whole, having that person your corner is very important.
Erick Murray
Obviously, having a financial planner, and that’s putting all of those different pieces together and coordinating with your CPA, with your state attorney to making sure that you’re getting the best holistic advice is what’s extremely important and very valuable for a lot of these athletes and for anyone. As a matter of fact, making sure you have that team built around you is always going to be the most benefit to you as opposed to just keeping all of your personal information, your financial pain points that you might have to yourself.
Erick Murray
Seeking guidance is something that guidance and feedback is always very valuable, and that’s what all these different people provide within your team.
John Ray
Yeah, boy, a lot to think about on all this. Let’s shift gears and just talk about when, if I’m a student athlete, when, do I need to be in touch with Erick? What are the symptoms that are going on in my world that make me think, I need to get this figured out?
Erick Murray
I would say as soon as you get that contract, as soon as you have that contract in hand, you’re going to want someone to look over it and see what the details are within it. Before you sign it.
Erick Murray
Because what you want to make sure is that you’re signing up for obligations that you can fulfill. You don’t want to overextend yourself and get in a situation to where you’re not really understanding the full legal obligations required within it. And so that’s the first place I would start, because when you’re looking at those contracts, not only are you representing yourself, but you’re also representing the team that you’re actually signing for as well.
Erick Murray
And so whether or not you carry yourself on the field a certain way, they also expect you to have that same kind of obligation and due diligence off the field. And so in those contracts, you might actually see a certain point that that explains if you don’t reach a certain kind of conduct off the field, this contract is no one valid, no known invalid, but it’s just really important.
Erick Murray
Make sure you have somebody in your corner that’s looking at those contract details, giving you what exactly it entails. You’re not making a bad decision when it comes to it.
John Ray
Yeah. And unfortunately we’ve seen a lot of that here lately. We had a real high profile athlete. We won’t get into who and what, but it’s a gambling related and it has cost that person a lot of financial difficulty. But embarrassment to and somebody that needs help in the middle of all this. So yeah that that makes a lot of sense.
John Ray
So success stories something tells me you’ve worked with some folks that are pretty happy with what you’ve done for them. You don’t have to mention names of course, but you’re in the confidentiality business. But talk about what some of those situations look like.
Erick Murray
Yeah.
Erick Murray
So the situations they do range, but one that comes to the top of my head is actually one of our Bayer clients that need some help just looking at what their benefits really are within their company. And it goes back into the complexities of these NIL contracts, figuring out what’s actually available to them for this particular client that we had, they had an opportunity to actually do a bit more than what their retirement contributions actually allowed them to do, and actually do what’s called an unplanned Roth conversion.
Erick Murray
So we’re just looking at different situations to how that can best fit for their situation. Do they have different areas that they can save and maybe defer some more taxes because of where they’re at? Today? We came down to the drawing, came back to the drawing board. It was a great situation for them, provided a lot of clarity, and that’s what we try to do well.
Erick Murray
We try to provide clarity with the options that are given to them with their situation, and try to put those two pieces together to reach their long term goals.
John Ray
Great work. Erick Murray from Healy Wealth Management. Erick, this has been marvelous. Thank you so much for coming in and sharing your expertise with us. Let’s get to the most important question, which is how folks can find you.
Erick Murray
Yeah.
Erick Murray
So the first place that you can find me is that Healy Wealth Management. Com. My direct business phone number is (770) 353-6446. And my email address is Erick at Healy Wealth. Those are the three different ways that you can find me. And just learn a bit more about our company and what we do over here.
John Ray
Terrific. Erick Murray, Murray Healy Wealth Management. Erick, thank you again so much for coming in.
Erick Murray
John, thanks for having me. I really appreciate it.
John Ray
Absolutely.
John Ray
Hey folks, here’s one headline you do not want to be the subject of. If you’re a law firm, medical practice, or a manufacturer. Local business pays thousands in ransom after cyber attack. Now you don’t want to be that business. And beyond, computer solutions exist to make sure that headline never has your name on it. They provide managed it and cyber security services built for industries where compliance and reputation are essential.
John Ray
These services really aren’t optional anymore, folks. We just had a guest in here a week ago talking about AI driven hacking attacks that happen continuously. Lots of bad guys out there with a lot of smart tools. So the best place to start is a complimentary security assessment. If you hadn’t had one of those in a while, you need to rush to be on keys and learn more.
John Ray
They do superb work and I know this myself because they keep us cyber safe here at North Fulton Business Radio. And if you’re a consultant, coach or fractional executive and you’re tired of the mindsets that hold you back in your business development and pricing, I’ve written a book for you. It’s called The Generosity Mindset, and it will change the way you think about the value you bring to clients, the relationships you build, and what you charge for your work.
John Ray
And you can find the book on Amazon or at The Generosity Mindset. And if you’re in the North Fulton region, you’ll find signed copies of the book on the shelf over at Barnes and Noble on North Point Parkway. And finally, I just want to thank you. If you’re listening to this show, I want to thank you for all your support over what has now been ten years of North Fulton Business Radio.
John Ray
We just blew the candles off that cake, folks, and we couldn’t have gotten anywhere near that kind of continuity without your kind support. You enable us to live into our mission to be the voice of business in the North Fulton region and beyond. And I’m grateful for you. If you’d like to reach out and touch me directly, offer feedback.
John Ray
So with my guest, Erick Murray, I’m John Ray. Join us next time here on North Fulton Business Radio.