Nov 23, 2024
The multimillion-dollar contracts for high-profile professional athletes often dominate the headlines.
But what rarely gets covered is how much these players actually take home after paying taxes, fees and dues.
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NFL star running back Austin Ekeler, who recently signed a four-year contract with the Washington Commanders worth $26 million, dove into those details in a recent interview with Graham Stephan on The Iced Coffee Hour.
“Thirteen percent is going to California, 37% or whatever is going to the feds,” said the 29-year-old. “Then my agent's taking 3% [and] some goes to the union for dues and things like that. So, you're left with I don't know 45% at the end of it.”
Instead of seeing these hefty expenses as a loss, Ekeler says he views it as motivation to branch out. “That's really where my entrepreneurial side started to kick up,” he told Stephan. Here’s how the young multi-millionaire is building immense wealth beyond the field.
Real estate
“For the most part, I put my money into real estate,” Ekeler said. “That’s my baby, the real estate portfolio.” This portfolio, he claims, holds 30 units across various multifamily properties and a real estate fund that has recently acquired a multifamily project that was in foreclosure.
Real estate, with its tangible value and opportunities for passive income, has often attracted the world’s rich and famous. NBA legend Shaquille O’Neal owns multiple “lavish properties” across Nevada, Texas, Georgia and Florida, according to the New York Post, while billionaire Earvin “Magic” Johnson’s real estate portfolio stretches from California to Hawaii, according to Architecture Digest.
You don’t need to be a celebrity athlete with millions of dollars in spare cash to get started with real estate. In some states like Illinois, the median home price is as low as $267,685, according to Rocket Homes.
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For those with even less cash, a real estate investment trust, or REIT, is an option worth considering.
Like Austin Ekeler, if you already have real estate exposure in your portfolio you could consider other opportunities as well.
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New ventures
Besides real estate, Ekeler’s business portfolio includes a streaming company and an app called Eksperience that helps connect professional athletes with their top fans. Earlier in his career, he claims, he invested in his friend’s lamp company, which “didn’t really work out.”
Nevertheless, his willingness to invest in new ventures offers a lesson for investors: diversification. Adding a new asset class to your portfolio could be a good way to minimize risk and bolster your long-term performance.
The most successful investors are often well-diversified. Warren Buffett’s empire, for instance, stretches from insurance companies to candy makers, while billionaire Mark Cuban’s ventures include enterprise software, the Dallas Mavericks and Cost Plus Drugs.
If you have managed to accumulate some wealth, even a modest amount, diversification can help you protect it. Perhaps the easiest way to diversify is to add a low-cost exchange traded fund that tracks a new asset class, such as SPDR Gold Shares (GLD), which tracks gold; Destiny Tech100 (NYSE: DXYZ), which holds startups like SpaceX and Epic Games; or iShares MSCI Emerging Markets ETF, which tracks blue chip stocks in China, India and other emerging economies.
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Vishesh Raisinghani is a financial journalist covering personal finance, investing and the global economy. He's also the founder of Sharpe Ascension Inc., a content marketing agency focused on investment firms. His work has appeared in Moneywise, Yahoo Finance!, Motley Fool, Seeking Alpha, Mergers & Acquisitions Magazine and Piggybank.
