Most athletes and families are never taught how risk actually works. NIL money and athletic opportunity can change quickly. Sometimes income increases fast. Other times it stops unexpectedly. The hard part isn't earning money — the hard part is keeping it, protecting it, and making sure one event doesn't wipe out everything you built.

Most athletes don't lose money because they are irresponsible. They lose money because money comes before education. This guide exists so athletes and families can understand the real risks that damage financial progress and learn the habits that prevent those setbacks. The goal of this guide isn't fear. The goal is awareness. Awareness prevents mistakes.

Help you avoid the most common mistakes, protect the family from unexpected costs, make clean decisions without pressure, and build stable habits that lead to long-term wealth

NIL Wealth Strategies was built around one simple belief: athletes shouldn't have to learn money lessons the hard way. I created NIL Wealth Strategies because I believe this education should be free. Families shouldn't have to pay thousands just to learn the basics—especially when athletes are now earning real money earlier than ever.

Most families and athletes struggle later on in the road because nobody ever taught them what to do. That includes basic things like how taxes work with NIL income, how risk exposure happens in athlete life, why injury recovery creates financial gaps even with insurance, how to make smart decisions without pressure, and how to plan for life after sports.

When most people hear the word “risk,” they think about investing. But for athletes and families, risk is bigger than that — risk is anything that can cost you money unexpectedly, even when life is going well. Athlete risk is different than normal careers because athlete income can be real money, but it’s often not stable money. Opportunity can shift quickly due to injuries, eligibility issues, coaching changes, transfers, performance changes, or brands losing interest. That’s why athletes and families need risk awareness early — not to live in fear, but to stay protected and prepared.

There are four categories of risk that cause most athlete setbacks. If an athlete understands these four categories, they can avoid most of the problems that destroy opportunities.

Income risk is the risk that your income changes suddenly, especially when your lifestyle becomes expensive. Athlete income is often seasonal and momentum-based. It can depend on exposure, performance, eligibility, health, and whether brands renew deals. This means one strong month does not guarantee a strong year.

Income can drop for reasons that aren’t always personal — injuries happen, playing time changes, coaches change, NIL rules shift, eligibility issues pop up, social media engagement can fall, and brands may stop renewing deals. When income drops, bills stay the same, and that’s how pressure starts. Income does not equal stability. Stability comes from structure. Building a cushion gives the athlete time to recover, adjust, and make smart decisions without panic.

Before increasing your lifestyle, ask yourself:

Tax and compliance risk is the risk of surprise tax bills, penalties and interest, IRS notices, audits, and stress caused by timing mistakes. Most NIL income is paid through 1099 income, which usually means no taxes are withheld. The IRS operates under a "pay-as-you-go" system, meaning taxpayers are expected to pay throughout the year—not just at the end.

As an Enrolled Agent, one of the most common things I see is families getting hit with unnecessary penalties—not because they didn't have money, but because they didn't understand timing rules. Taxes are a timing game. Save taxes first and spend second. Tracking protects you.

Liability risk is the risk that an accident, mistake, misunderstanding, social situation, or legal claim creates a major financial consequence. This is one of the most ignored athlete risks—and one of the most expensive when it happens.

Athletes have higher visibility and are often a higher target. That increases exposure. Liability situations commonly include:

Many families believe having health insurance means injuries won't create financial stress. The truth is, injuries often create real out-of-pocket costs even with insurance. One accident, on or off the court, can cost more money than you have ever earned.

That includes deductibles, copays, coinsurance, out-of-network bills, and travel and recovery-related expenses. Even when medical care is covered, families can still pay thousands during injury recovery.

Decision risk is the risk of losing money due to rushed decisions, pressure, emotional spending, trusting the wrong people, and saying yes to something you don't fully understand. Decision risk destroys athletes faster than anything.

Understanding how these risks actually happen in real life helps families see what to avoid. Here are four common scenarios: