Yahoo Finance’s Alexis Christoforous and Wale Ogunleye, former NFL player and head of sports & entertainment at UBS discuss why financial literacy is so important.
ALEXIS CHRISTOFOUROS: It is an all too familiar story. Pro athletes coming to a lot of money at a young age with little to no guidance. And many of them lose it all. Consider this statistic. 78% of NFL players who are retired for just two years file for bankruptcy.
My next guest is trying to change that. Wale Ogunleye is a former NFL player with the Chicago Bears who's now head of sports and entertainment at UBS Wealth Management. We are also joined by Yahoo Finance's Reggie Wade.
Wale, so good to see you here. Thanks for being with us. Why do you think so many athletes fall into these money traps? And how are you and UBS helping them navigate through that?
WALE OGUNLEYE: I think it's pretty simple. I think the sector has done a terrible job of bringing their expertise to the clients, to the athletes. Too many times it's the other way around. I, as a former athlete, I have experienced it. I met with financial advisors. And they spoke in jargon. And they assumed that because I had all this money that I should understand the things they were saying. It's really the other way around.
Finance and money are a different language. The terminology that's used, the jargon that's used is sometimes in a way that causes people to be confused. And that confusion leads men who, in the locker room-- or men and women, they're alphas, they're leaders. And sometimes we're too embarrassed to say, you know what, I didn't understand a word you just said. And all we do is nod yes. And that's how we get ourselves in trouble.
So with the new athlete entertainer segment at UBS, what we want to do is symbolize that we understand that you might not fully grasp what money is. And let's take you through the process. Let's hold your hand. Let's become partners. Let's not be fans of our athletes and entertainers. But let's actually be strategic partners in teaching how you should manage and make sure that the hard work that you've done on the field, on the stage, or on the court lasts for generations to come.
REGGIE WADE: Wale, Reggie Wade here. I know you're going to have a big part in UBS's initiative to sponsor 2,000 students through the Goalsetter Foundation to teach children financial literacy. Why do you think now is a good time to start getting young people interested in their finances?
WALE OGUNLEYE: A better question is why not now, right? The opportunity with Goalsetter, which is an amazing initiative, where they're trying to get 1 million Black and Latinx young adults bank accounts. And the studies show that six times more chance of kids who have opened up bank accounts go to college and four times chance that they'll invest as an adult.
So we know that if we're going to try as a community to slim down the wealth gap, now's the time for us to help in that initiative. And Goalsetters is a great place to start. And we're happy to be partners with them as they move down this path.
ALEXIS CHRISTOFOUROS: Wale, I know that during your 11 years in the NFL, you actually became the highest paid defensive lineman in the history of the league. What was your personal experience? Did you have mentors? Did you have people helping you, guide you on how to deal with your newfound money?
WALE OGUNLEYE: Well, listen, I would have loved to be the highest paid defensive player in the league. At the time, I signed the biggest contract of a restricted free agent in the league. So let me clear that up. I don't want my phone now ringing off the hook, like, whoa, I didn't know you had that much money.
But really, what happens is, my experiences have played a big part in the situation. I talked about not understanding finances. I don't even know what a basis point was when people were talking about, hey, we're going to charge you this amount to manage your money. I was one of those guys that nodded. And that risked millions of dollars, me not having that knowledge.
I went back, got my MBA. And now I've realized that big firms like UBS, it is our job to make sure that those headlines that you talked about earlier, that they're not talked about anymore. The amount of money that these players are making, if you even take a guy like Patrick Mahomes, half a billion dollars to play football, there's no reason why him and his family and generations to come should have any issues when it comes to money.
And what UBS is going to do is take that initiative of understanding who our clients are, understanding that things that are important to them. And some of those things may be philanthropic endeavors. And that's why getting involved with the Goalsetters Foundation and things that we're doing is showing the industry we're disrupting that. We're showing that we actually understand our clients. And it's an exciting time here at UBS.
REGGIE WADE: Wale, what are some of the lessons that you learned on the gridiron that you've brought over to the business side in this new career?
WALE OGUNLEYE: Great question, great question. One, hard work, dedication. Number two, every step that I've taken since I got out of high school, maybe even in high school, from my step to my eye placement, my hand placement, how fast I ran, my hustle was criticized. So being able to take constructive criticism, knowing that it's for the betterment of the team is something that me in my personal career, I've been able to transform into the corporate world.
I see this in the same vein. We're a team. We're doing this together. It doesn't matter who gets the accolades. As long as our clients win at the end of the day, that's really what matters to me. And I feel like this transition, as different as it may be, it actually has been a smooth transition for me because it fits all those elements of working together for the greater good. And for us, that's making sure our clients, especially in the athlete and entertainer segment, are provided the best product and service and management possible.
ALEXIS CHRISTOFOUROS: Wale, do you think that players' unions, regardless of the league, but just players' unions should be doing more to help the players manage their money?
WALE OGUNLEYE: That's a great question. But it's difficult because at the end of the day, some of these young men and women are parents and married and have full families. So it's hard to force someone, after they've made it in their professional, to say, hey, this is what we should do.
We think it should be a collective effort. We think the owners, the players' unions, and the ecosystem around these players should be one where we're pouring into the players. Too many times, all connectivities to these players and athletes are transactional. Let's start making this a real relationship. Again, understand who they are, things that they care about, and the things that they want to do after they get done with their careers.
I played in the NFL for 11 years. And let's be honest, that's an anomaly. Tom Brady's played for 20 years. That's unheard of. So we've got to know that there's going to be a time where your 15 minutes of fame are up. And we should be in a position, from the players' unions to the owners to financial institutions, to make sure that these young men and women who provided so much memories and good times for our communities are set up for winning off the field, off the court, or off the stage.
ALEXIS CHRISTOFOUROS: You still a fan of the Bears?
WALE OGUNLEYE: Oh, all day, all day, every day.
ALEXIS CHRISTOFOUROS: Wale Ogunleye, thank you so much for joining us, and to our Reggie Wade as well. Have a good weekend, guys.