Van Hees Strategic Advisory
.png)
Professional footballers, financial literacy, and large sums of money.
Professional footballers generally earn an immense amount of money. The average gross annual salary in the Eredivisie is €420,000. That amounts to €35,000 gross per month. And that is just the Eredivisie. In the English Premier League, the average lies at over €3 million gross per year. This is essentially the salary framework a professional footballer encounters in their career. Let’s be honest: €35,000 gross per month is already an astronomical figure. It is an overwhelmingly large amount, let alone a contract in the Premier League. The average first professional contract for a youth player in Dutch professional football is around €30,000 to €40,000 (approximately €2,500 to €3,300 gross per month), although at top clubs this can rise to €5,000 per month or more for exceptional talents. A youth player in Dutch professional football can sign their first pro contract starting at age 15. This age limit was lowered by the KNVB from 16 to 15 in 2020.
The average background of a professional footballer in Europe is traditionally working-class or from lower socio-economic backgrounds. Working-class and lower socio-economic salaries in Europe vary significantly by country, ranging from roughly €620 gross per month in Eastern Europe to over €2,300 to €2,700 gross per month in Western and Northern Europe. Because the European Union lacks a uniform wage, income status depends on local legislation, collective labor agreements, and the cost of living. For the most part, people from working-class and lower socio-economic backgrounds are not financially literate, let alone a child/teenager of 15 or 16 years old. When looking at public education, little to no financial instruction is provided. Financial literacy is typically taught at universities and similar institutions. For financial literacy, you have to pay.
Based on the data, we can assume that an average youth contract has a massive impact on the family. When footballers are minors, it is the parents who sign the contracts. All of this occurs without financial literacy. As a result, various scenarios play out within families until a player reaches adulthood. Because parents are responsible for their son's financial situation for a period, they also have power of attorney over the son's bank account. Naturally, there are parents who conduct themselves properly and manage the money neatly until the son is 18 years old, but there are also plenty of cases where the parents have squandered all the money. There are also family situations where the child is taught to take care of the parents. The parents then simply claim a large portion of the money because they once decided to have a child. Make it rhyme, but that is how some people think.
Then there are parents who begin to adore their child because of the money he earns, turning them into yes-men who approve of everything the son does outside of football. Consequently, a 15, 16, or 17-year-old has total freedom to do as he pleases. Surely other scenarios are possible, but for this blog, this is sufficient for context. The salary a youth player receives feels to them as if they are winning the jackpot every month. Think back to what you earned at that age, and you will understand that it must feel like a jackpot to those guys. Due to the aforementioned scenarios, among others, a new pressure arises. The pressure of money, and how to handle it. Mind you: we are only talking about professional footballers in the youth ranks, the foundation. I hope I have your attention as a director, trainer/coach/supervisor of a club, because this blog is of crucial importance.
Alongside the (new) pressure called money, expectations also change, both for the parents and the footballer. And that is logical, because that is simply how life works in a capitalist society. Everyone participates, consciously or unconsciously. The financial system leaves you behind if you are not looking for more. For an average family, it is nearly impossible to keep up financially with current and future economic developments. Inflation is the primary cause of this. A family with a son on a youth contract therefore often sees the child as a lifeline, an escape from the rat race. This leads to the scenarios I already mentioned in a previous paragraph. Realize the kind of pressure a youth player faces the moment they sign a youth contract. And we haven't even discussed the social environment, advisors, and player agents. Ultimately, it is very simple: the more money that comes in during a successful career, the greater the problems become.
This arises because no one in the family actually understands money. Let’s be honest: hardly anyone knows the true definition of money. Personally, I am very familiar with it, as it is a core component of investing. See my story (top right in the menu) for my CV.
Since we deal with the same types of people in every layer of our society and economy, it means that financial literacy is generally at a low level. Bookkeeping and administration, such as incoming and outgoing invoices, is not financial literacy. Keeping track of your income and expenses (budgeting or having your household accounts in order) is simply administration and discipline; it is a basic calculation of in versus out. But it has nothing to do with understanding how the monetary system works, what inflation does to your wealth, how to protect capital through proof-of-work assets, or how to invest, for example, to escape the rat race.
Cognitive Load: A boy of 15, 16, or 17 should be focused on his running lines, his technique, his joy in the game, and so on. If he unconsciously carries the burden of being the "financial salvation of the family" on his shoulders, it consumes a huge portion of his mental bandwidth. The mental energy he needs for his "flow state" is now swallowed up by existential stress.
Fear of Failure versus Freedom: If you play football because you must perform (because your parents/the family are dependent on your success), intrinsic motivation disappears. You then start playing not to lose instead of playing to win. You see that tension reflected in the choices such a player makes on the field: the safe pass, the fear of making a mistake, the lack of creativity.
The "Emergency Brake" on development: Performance at that level requires a huge degree of relaxation and self-confidence. If that "lifeline pressure" is constantly present, you simply cannot play football freely. On the pitch, you are no longer a footballer, but an asset in a financial transaction that must not fail. And then there is the pressure the youth player creates themselves. Ultimately, it is the player who has to deal with their personal expectations, those of their parents, and their social environment. It seems clear to me that the majority of youth players run into these kinds of problems on a financial level. As a result, almost all youth players simply perform less well on the field. Since almost all clubs in the Netherlands, but also in Belgium, offer no help regarding learning how to handle money, these clubs also do not realize that the players are underperforming because of it.
For a football club, "homegrown" players are the most important assets they possess. These types of players have been with the club since childhood, meaning the investment on the balance sheet is zero. It is therefore essential to build up every homegrown player to their maximum potential. There is no easier way of value creation than developing a youth player through to the first team. The moment such a player reaches the first team and starts getting minutes, the market value skyrockets. Literally by tens of thousands, or even hundreds of thousands at a time. There is no market or niche where you can create value so easily. Furthermore, in football, you have to deal with the "heat of the moment," which means prices are sometimes paid for players that you know are not worth it at all. In other words: investing in youth is a priority, an absolute must. The maximum focus should be there, provided you are a professional football organization. Financial education is part of that; otherwise, as a club, you are not delivering a fully professional, sustainable product. Without this education, you are essentially delivering a semi-finished product.
A player who is financially literate does not experience the issues I have just described. Someone who is familiar with how to handle money is simply no longer as influenceable. As a result, such a person can offer resistance to everything I have written about.
It is literally that simple. I am speaking from my own experience now: when you are financially literate, your way of life also changes slowly but surely. You literally look at life and the world differently; again, that is literal. The social environment changes spontaneously, because you have less interest in associating with people simply because they are not involved in the same matters as you. Daily thoughts are also completely different. Most people live and think at a surface level and occupy themselves with superficial matters. Someone who has financial understanding thinks on a completely different level. An average person is busy ensuring they can pay the bills every month. Someone who possesses financial knowledge is busy with their income streams, insuring wealth growth, and securing their own equity. All of this provides financial peace, which causes self-confidence to grow. This self-confidence is reflected in everything.
I know what financial knowledge has meant for me, and I am still reaping the benefits today. I am not a financial advisor. I speak from my own life experiences, which you can read under the "my story" button. Everything I know about finance, I taught myself. After all, that is what we have the internet for, or at least that is what I largely use the internet for.
It is for this reason that I advocate for the implementation of financial education in the football world. It should actually be a requirement, given that a football club can earn quite a bit from a player. It also benefits the clubs themselves, as most directors, coaches/trainers, and supervisors often lack financial knowledge as well.
Once again: accounting and keeping track of your income and expenses (budgeting or having your household books in order) is just administration and discipline; it is a calculation of in versus out. But it has nothing to do with understanding how the monetary system works, what inflation does to your wealth, how you protect capital via proof-of-work assets or how you invest, for example, to escape the rat race.
The conclusion is clear: tackle the (financial) problems at the source. Prevention is better than a cure.
Do you want to professionalize the financial education within your youth academy and truly prepare players for the adult professional world? Or are you a parent or player looking for advice, then please get in touch. I am not a financial advisor; I provide advice based on personal experience.