NEWS & RESOURCES

Authored by: Jason Underwood, CFP, Wealth Advisor

Name, Image, and Likeness (commonly referred to as NIL) has changed the landscape of college athletics. Student athletes can now earn income from endorsements, appearances, social media, camps, and other opportunities tied to their personal brand. While the headlines often focus on high-profile deals, NIL opportunities exist at many levels and can take families by surprise.

For parents, the most important step is not chasing opportunities, but being prepared if and when income starts to come in.

NIL Income Is Still Taxable Income

One of the most common misunderstandings about NIL earnings is that they are treated differently for tax purposes. In reality, NIL income is taxable, just like income earned from a part-time job or freelance work. In many cases, student athletes are considered independent contractors, which means no taxes are withheld automatically.

This can create an unexpected tax bill if families are not planning ahead. Keeping track of income, saving for taxes, and understanding potential filing requirements are all critical from the start—even if the amounts seem small at first.

Separate Personal and NIL Finances Early

A simple but effective step is separating NIL-related income from everyday spending. Opening a dedicated checking account for NIL earnings can make it easier to track income and expenses, stay organized for tax time, and demonstrate financial responsibility as opportunities grow.

It also helps student athletes begin learning real-world money management skills—an often-overlooked benefit of NIL.

Understand How NIL May Affect Financial Aid

While NIL earnings don’t affect NCAA eligibility, they can impact need-based financial aid. Because NIL income is reportable income, it may be considered when completing the FAFSA or other aid applications.

Parents should be aware of this possibility and plan accordingly, especially if the student relies on grants or need-based scholarships.

Guardrails Matter More Than Ever

NIL has introduced contracts, brand relationships, and public visibility at a much younger age. Parents play an important role in helping student athletes slow down, read agreements carefully, and avoid deals that don’t align with their values or long-term goals.

Even modest NIL opportunities can set precedents, so establishing expectations early—around spending, saving, and decision-making—can pay off later.

Start With Education, Not Optimization

At the introductory level, NIL planning doesn’t require complex strategies or advanced structures. The goal is awareness: understanding that NIL income is real income, that it comes with responsibilities, and that preparation matters.

Families who take time early to learn the basics are better positioned to handle growth responsibly if opportunities expand.

NIL has created new possibilities for student athletes, but it also introduces financial complexity at an early stage of life. For parents, the best approach is proactive and measured—focusing on education, organization, and thoughtful planning rather than headlines and hype.

Preparing early helps ensure that NIL earnings support both the student’s athletic journey and their long-term financial foundation.