New Financial Normal

A New Financial Normal For College Athletics

We hope this article finds you and your families safe and healthy as some sense of normalcy has returned with the start of the school year in some way, shape, or form. While some schools and conferences have returned to action on the field, the reality is that the majority of programs have had their seasons postponed or even cancelled for the first time in decades. Across all levels of college football, the list of teams playing this Fall is much shorter than the list of schools who are not playing. And without games being played, the unfortunate financial reality is that revenues from a variety of sources will either decrease or go away altogether.

Like any other business operating in a deep recessionary environment, higher education institutions are not exempt from reduced revenues, and, therefore, reduced budgets. As a result, employees sometimes feel the worst of the pain caused by deep recessions like we are currently experiencing. In fact, a recent study of 62 institutions by Huron Consulting Group shows that Presidents, Deans, and other executive leaders at public institutions have taken an average pay reduction of 12 percent while counterparts at private institutions have taken a 14 percent pay cut (1).

Unfortunately, pay cuts and reductions in employee benefits have also affected quite a few employees in the world of college athletics.  ESPN surveyed head football and basketball coaches in the “Power 5” conferences in July and found out that at least 32 of those coaches took a pay cut (2). Countless other coaches and athletic department employees have either taken similar pay cuts or have been furloughed in various ways as a result of significant amounts of lost revenue from the pandemic.

As such, countless families in the coaching fraternity are facing the reality of a reduced income or benefits package for the foreseeable future. So, now what? If you and your family have been adversely affected by the pandemic, here are some tips on how to successfully navigate the current environment of unprecedented uncertainty in the business of college athletics:

1) Adjust Your Budget To The “New Normal”

In a lot of cases, family budgets have excesses built in that can be cut down fairly easily. In fact, the social distancing guidelines put into place in some states have already caused some of us to cut back on certain non-essentials, like meals out and live entertainment, and even some essentials, like transportation. But here are other simple ways that you and your family can also reduce expenses:

  • Categorize future expenses as “need to have” or “nice to have.”
  • Consolidate home loans, credit cards, or other debts into loans with lower interest rates.
  • Re-evaluate the use of monthly subscriptions like cable or streaming services and paid websites and other publications.
  • Shop around for more affordable property and casualty insurance coverage.

2) Tap Into Your Emergency Fund

If you had the resources and foresight to have already established an emergency fund, now may be an appropriate time to use it to help supplement your current income or replace lost income. If you do not have an emergency fund to tap into, here are a couple of options to consider:

  • Look into getting a zero-percent-interest credit card for a 6 to 18 month period and commit to paying it off on time.
  • Start a “side hustle” or part-time job in which you or your spouse can make extra money at something you are good at like personal training, coaching clinics, or tutoring.

As a last resort, you may also consider tapping into your retirement savings. Because of the extraordinary circumstances of present day, The CARES Act has adjusted the rules around penalties and tax payments for early withdrawals and loans from retirement accounts to make it easier on people who need to tap into these funds right now.

3) Do Not Reduce Your Retirement Savings Too Much (If Any)

While it may be difficult to stay focused and disciplined on long-term financial goals during a period of elevated stress some coaches are currently experiencing, it is important to balance your needs now and for your future. As such, if at all possible, make every effort to at least maintain your salary deferral into your employer-sponsored retirement plan to take full advantage of your employer’s contribution or matching structure.

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For example, if your employer matches 100 percent of your contribution up to 5 percent, you need to be sure to contribute at least 5 percent as a salary deferral to maximize this employee benefit.  Do not leave “free money” on the table.  While the IRS allows for a maximum salary deferral of $19,500 (or $26,000 if you are over 50 years old) in 2020 (3), that amount of salary deferral may not be affordable for most families.  In that case, contribute as much as you can during these extreme times while still living a comfortable lifestyle and commit to adjusting as salaries normalize in the future.

4) Don’t Go It Alone

If you and your family have not enlisted the services of a Financial Advisor up until this point in your career, there is no better time than now to hire one. You do not need to fight financial stress or make decisions with possible long-term effects alone. It is important to find a Financial Advisor who takes the time to get to know you and the unique needs of your family.

Much like that freshman who arrives on campus oozing with potential and talent but still needs some coaching, a Financial Advisor may be able to simplify what otherwise may be complicated or overwhelming issues that you may or may not have the expertise or experience to battle through by yourself. In most cases, a Financial Advisor with a long-term planning focus can take the emotions out of the decision-making process and add value in a variety of ways beyond portfolio construction or investment recommendations.

We wish you and your families, friends, staffs, players and administrators the best as we all navigate through what is undoubtedly the most unique football season that we have encountered to date and all of the complex and stressful decisions that pop up along the way.

About The Authors

Investment with Matt Kuerzi and Keith NorrisKeith Norris, First Vice President and Financial Advisor, and Matt Kuerzi, Vice President and Financial Advisor, are co-founders of The Derby City Group at Morgan Stanley in Louisville, Kentucky.  They have a combined 40 years of experience helping families with their financial planning (4).  In 2019, Matt was recognized by Forbes in their first ever list of “Best-In-State Next-Gen Advisors”.  He can be reached directly at (502) 394-4094 or

Branch address: 4969 U.S. Highway 42, Suite 1200, Louisville, KY 40222

(1)   “Going Viral: A Regular Digest of Responses to the COVID-19 Pandemic in American Higher Education” by Huron Consulting Group; August 28, 2020



(4)   Keith Norris, First Vice President, Financial Advisor, experienced in the financial services industry since 1997.  Matt Kuerzi, Vice President, Financial Advisor, experienced in the financial services industry since 2002. 

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