This fall, as millions tune in to watch the football season unfold, Ally Bank wanted to see what football could teach people about everyday financial management. We spoke with Donald McPherson to find out.
Quarterback for the Philadelphia Eagles, NCAA College Football Hall of Famer and gameplay analyst for networks like ESPN and NBC, McPherson’s football expertise is extensive. After retiring from professional football in 1994, McPherson founded an array of educational outreach and advocacy programs, including one that helps college athletes prepare for their financial futures.
“So much of my financial life was taken care of by someone else,” says McPherson, referring to the support he received in college.
Now, McPherson works with students and college athletes on developing the financial skills he considers to be so critical. Below are a few of those lessons.
Practice, Practice, Practice
“The biggest thing in football is that we practice every day,” says McPherson. On the field, that means, “We start with the fundamentals – stretching, drills, small skills,” says McPherson. “Then we build on more sophisticated things.”
In finance, some fundamentals to consider include having an emergency fund,a great checking and savings account and a budget that helps you achieve your goals. Setting yourself up with these essentials doesn’t necessarily put you on the path towards millions, but neglecting them can often result in setbacks.
“I know people who have all this money but they can’t take care of the basics,” says McPherson. For example, forgetting to pay bills on time is a simple mistake that can trigger major repercussions: late fees, loss of services and possibly even an impact on your credit score.
So how can you practice financial fundamentals? Perhaps you pick one Sunday each month to pay all your bills. Or you set up automatic bill payments so you’re never late. Or you create a budget each week for a month, keeping track of how well you stick to it, and crafting an even better budget for the following month.
Sticking to Your Game Plan
Every football team has its own playbooks. In them you’ll find plans for offense, defense, special teams and everything in between. Your money, McPhereson says, needs a playbook, too. Here’s how he recommends creating one.
“First, you look at the assets you have,” McPherson says. “The biggest mistake people make is that they don’t take an honest look at their resources.” Ask yourself: How much income do you really earn each month? How much money do you spend on bills, eating out and entertainment? How many accounts do you have at different banks, and which accounts are working for you and which are costing you? Once you have an honest assessment of your assets, you can execute financial plays with the “resources you really have on the field.”
Of course, no playbook is perfect. Even the best-laid plans can take time to win results. That’s where patience comes in. “Take Eli Manning,” McPherson says. “In week five of the season he was doing terribly and everyone wanted to get rid of him – I was one of the people saying it!”
But the team stuck to their plan. Manning rallied in subsequent weeks and went on to win the Super Bowl. In retrospect, McPherson says the Manning episode demonstrated a very important lesson – plans often work when you have the patience to see them through.
“Whether it’s the economy, housing or football,” McPherson says, “sometimes you just have to stay the course.”
Except, of course, when you can’t. Unexpected events – be it an unforeseen defensive blitz or a sudden loss of income – can jeopardize your playbook . At other times, these unexpected events can actually present opportunities. The question is: Can you plan for the unplanned?
Yes, answers McPherson. “As much as we like to think we can’t predict the future, everything bad that’s happened has happened before.” In football, McPherson says, unexpected blitzes can force a quarterback to change gears. But well-prepared teams practice these drills over and over, so the team knows exactly what to do. “In life, people lose jobs, get ill and all kinds of things happen,” McPherson notes. “Prepare for these things.”
Seeing the Whole Season
In football and finance, seasons are won one game at a time. It’s important, says McPherson, to take the long view, whether it’s of a football season or a personal financial goal.
Training camp is like “your early days of education.” Next comes the regular season. In life, that’s advancing your financial skills, beyond the fundamentals to include finding a career that provides the income you’ll need to accomplish your financial goals. A bonus benefit: an enriching career can help keep your spending in check.
“If I spend my entire day doing what I love, I’m not dreaming about a big vacation or what kind of car I have,” he says. “What’s more important to me is what I spend my time on.”
Finally, there’s the post-season. “You’re doing all this work for the sweetness of retirement,” he says. “Nothing is better than the retired grandpa, especially if he’s got a few dollars in his pocket.”
Where have you discovered financial lessons in places you didn’t expect? What’s your game plan: financial offense or defense?