When most people think of New England Patriots’ tight end Rob Gronkowski, they think of a fun-loving, goofy party boy, who likes to cause a little mischief from time to time…not many people think “financially savvy.”
In June 2012, the New England Patriots and Rob Gronkowski (hereinafter, “Gronk”) agreed to a six-year, $54 million contract, including an $8 million signing bonus, $13 million guaranteed, and an average annual salary of $9 million. Now, we all know that Gronk loves a good party, and those parties cost money – wild celebrations, legendary spring breaks, his very own party bus (Gronk Bus LLC), his upcoming party cruise ship that leads to a party on “Gronk Island,” and the list goes on!
Good thing he has this epic contract money to support his party habits, right???
Well, actually, that assumption would be #wrong…
This past summer, Gronk revealed his new book, “It’s Good to Be Gronk,” where he revealed his biggest secret of all: he is three years into his six-year contract with the New England Patriots and has yet to spend a dime of that $54 million. An excerpt from his book reads:
“To this day, I still haven’t touched one dime of my signing bonus or NFL contract money. I live off my marketing money and haven’t blown it on any big-money expensive cars, expensive jewelry or tattoos and still wear my favorite pair of jeans from high school… I don’t hurt anyone.”
So aside from being super fun to party with, we all know that Gronk is amazing at playing football (definitely wish I had him on my fantasy team this year). But even I did not think it was possible that 26-year-old, fun-loving Gronk is even better at playing the endorsement game. I am sure most of you have seen how Gronk successfully brands himself by maintaining a strong presence on social media platforms, such as Facebook and Twitter.
Gronk has also teamed up with brands such as Dunkin’ Donuts, BodyArmor sports drinks, Zubaz sweat pants, Nike (if you have not yet seen the “Snow Day” commercial, click here – I highly recommend it), and more.
While Gronk has been smart to “live off [his] marketing money” and to save his football contract money, other NFL players have not been as insightful with their financial decisions. There has been no shortage of NFL players spending all of their cash almost as soon as they get it – nearly 16% of NFL players (roughly 1 out of 6 players) drafted between 1996 and 2003 declared bankruptcy within 12 years of retirement. Moreover, poor money management is a problem that plagues athletes in all sports across the globe and can be attributed to many factors, such as lavish spending, divorce or unexpected injuries. When all is said and done, though, a lack of financial planning is the ultimate downfall for athletes.
Gronk, on the other hand, has had the foresight and good sense to work with a financial advisor to assist with his wealth management. Below is an example of an investment portfolio that can preserve capital for individuals (i.e. professional athletes) with “Blue Chip” earnings power, ranging from $50 to $100 million:
Recently, Capital One has taken advantage of Gronk’s saving tactics by having Gronk offer financial advice to consumers about things like sub-savings accounts and emergency savings funds, which leads me to….
Key Takeaways from #GRONKonomics101:
- There is more to Gronk than just a great football player with a mischievous smile that loves to have fun and party.
- NFL Players, and athletes in general, can learn a lot from Gronk and his money saving tactics, such as:
- If an athlete is given the opportunity to make money through an endorsement deal, they should do so wisely and use such remuneration for spending money as Gronk has done (while wisely saving contract-related income).
- If they haven’t done so already, athletes should really seek out a financial advisor to help with investing and saving endeavors as well as to prevent the earnings depletion that has plagued so many athletes before them.
- Marketers who partner with celebrity endorsers should take a lesson from Capital One’s venture with Gronk by creating campaigns with a unique and honest angle that stay true to the brand’s identity.
- If you are not already a fan of Gronk, you should be now…just saying.
And now concludes my #IS6621 lesson on #GRONKonomics101. I hope you have all learned something new and have smiled or laughed at least once after reading my blog post (hopefully more than once, but I know I am not that funny).
I hope all of you and your families have a wonderful Thanksgiving – eat a lot of turkey etc., drink your libation of choice, be merry with friends and family, & party like Gronk!