Name, Image, and Likeness (NIL) opportunities have opened doors for student-athletes that didn’t exist just a few years ago.
For many families, this is the first time their child is earning meaningful income, sometimes before they’ve ever filed a tax return.
While NIL can be a powerful opportunity, it also introduces complexity, risk, and responsibility. For parents, the goal is to help them protect what they earn and set themselves up for the future.
NIL Income Comes With Adult Responsibilities
NIL earnings are typically treated as self-employment income, which means no taxes are automatically withheld. Payments may also arrive irregularly, and strong record keeping is critical.
Without guidance, it’s easy for a student-athlete to spend first and worry later. This approach often leads to surprises when the tax bill arrives. Early structure and oversight can prevent unnecessary stress and penalties.
Taxes Are Often the Biggest Surprise
Many NIL earners underestimate how much they owe in taxes.
Depending on income level and state, a significant portion of NIL earnings may be owed for federal, state or self-employment taxes.
Parents play a crucial role in helping their athlete understand that not all income is spendable income. A simple plan to set aside money for taxes can make a meaningful difference.
Protecting Your Loved One
Young adults are still developing financial judgment, especially when income arrives quickly. They may want to overspend during high-income periods, sign unfavorable or restrictive contracts, make speculative investments, or commit to fixed expenses that outlast NIL income.
The goal is to put in guardrails that allow your athlete to learn while staying protected.
NIL Should Support Education, Not Distract From It
NIL is an opportunity, but education remains the foundation.
Families benefit when NIL income is used to reduce student debt or create financial breathing room. It’s helpful when it’s used to support long-term goals beyond athletics.
Plan for the Reality That Athletics Is Not Forever
Sports careers are always uncertain. NIL income can serve as a head start on long-term savings. It’s a bridge to graduate school or early career opportunities.
Parents who encourage forward-looking planning help their athlete make decisions based on options, not financial pressure.
Choosing Advisors Carefully Matters
The NIL landscape has attracted agents, marketers, consultants, and “friends of friends.” Not all are acting with your child’s best interest in mind.
Parents should look for advisors who educate rather than sell, coordinate with tax professionals, emphasize long-term outcomes over quick wins, and respect the family’s values and priorities. Good advice at the beginning can be far more valuable than fixing mistakes later.
Trust the Experienced Financial Experts with NIL Guidance
NIL has created incredible opportunities and some real responsibility for student-athletes and their families. With thoughtful planning, the income can become a powerful stepping-stone rather than a source of stress.
Parents play a vital role in helping student-athletes navigate this new terrain with confidence, clarity, and perspective. XXI helps student athletes and their families create a winning financial game plan. Contact us today to set up a free consultation and find out more about our services.
