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Financial Fundamentals

NFL Player Breaks Down His Paycheck

Alexandra Ardelean

I'm a huge sports fan. I love watching games, following my favorite teams, and getting into the nitty-gritty of the action. But what really fascinates me is the financial side of pro sports. How much do athletes make? What's their take-home pay after taxes? And how do they manage their money?

It's mind-boggling to think about the amount of money that flows through professional sports. For example, Serena Williams' career on-court earnings are close to $95 million. Peyton Manning had a five-year NFL contract for $96 million. And the biggest tournament prize in the PGA last year was $25 million.

But as we all know, gross earnings are just part of the story. Taxes, fees, and other deductions can take a big bite out of an athlete's paycheck. And that's where things get really interesting.

Recently, I saw a reel that caught my eye. It was from NFL player Eric Armstead, and he was breaking down his paycheck. As soon as I saw it, I knew I had to share it with you.

But before we dive in, let me tell you about a game that I've been playing with my friends and family lately. It's called tapple, and it's a blast. If you're looking for a fun and competitive activity to enjoy with your loved ones, I highly recommend giving it a try.

Now, let's take a closer look at Eric Armstead's reel and see what we can learn about the financial side of being an NFL player.


Reel Analysis: NFL Game Check Breakdown

In this reel, Eric Armstead gives us an inside look at how an NFL game check works. He starts by showing us his own paycheck and then walks us through each section to explain what it all means.

Let's break it down step by step.

Salary Breakdown

The first thing we see on Eric Armstead's paycheck is the "amount" section. This is the most straightforward part of the paycheck because it shows exactly what hits his account when he gets paid.

Below that, we have the "earnings" section. This is where things get interesting because it breaks down exactly what Eric made and where it came from.

For example, we can see that Eric made $393,000 from "P5DW." What does that mean? Well, Eric explains that "P5DW" is his code for paragraph five of his contract, which is his base salary.

He goes on to say that last year, his team converted some of his salary into a signing bonus for cap relief. So even though he made $393,000 from his base salary, he also made an additional $1 million from his signing bonus.

Taxation Impact

Now here's where things get really interesting. Even though Eric Armstead made over $1 million in gross pay, he didn't take home anywhere near that amount.

In fact, after taxes and other deductions were taken out, his net pay was only $198,000.

That means he lost almost half of his gross pay to taxes and other expenses!

State Taxation Differences

What's even more fascinating is how state taxation impacts an NFL player's take-home pay. As Eric explains in the reel, NFL players are taxed based on the state they play in.

This means that players who play in states with no income tax (like Tennessee) will take home more money than players who play in high-tax states like California.

In fact, players who play in California could potentially be filing up to 10 different tax returns and paying up to 50% of their salary in taxes!


Financial Planning Considerations

As someone who loves personal finance and helping others understand their money better, this reel was like catnip for me. It perfectly illustrates how important it is to understand your income and the impact of taxes on your take-home pay.

Whether you're making millions as an NFL player or earning a more modest income in a traditional job, knowing how much you're actually bringing home each month is crucial for effective financial planning.

Understanding your deductions - whether they're for taxes, health insurance premiums, or 401k contributions - will help you create a budget that reflects your true take-home pay. This will allow you to allocate your money more effectively and make sure you're not overspending based on your gross income.

And speaking of health insurance premiums... did you know there are alternatives to traditional health insurance? Christian Health Care Ministries is one such alternative - they're a sponsor of mine - offering health cost-sharing programs that can save you money on your monthly premiums while still providing comprehensive coverage for unexpected medical expenses.


Fluctuating Income in Pro Sports

One thing that stood out to me as I watched this reel was how much an NFL player's income can fluctuate from week to week. As Eric explains in the video, NFL players are paid weekly during the season - which means they have 18 game paychecks per year (including preseason).

On top of that, they can earn additional money if their team makes it to the playoffs or championship game. However, those earnings are not guaranteed - so while they can significantly impact a player's yearly income, they're not something you can count on when creating a budget or financial plan.

This kind of fluctuating income isn't unique to pro athletes - there are plenty of professions where your earnings can vary greatly from month to month or season to season. For example:

  • Real estate agents might have a great month when they close multiple deals but then go several months without any commissions coming in.
  • Wedding makeup artists might have a busy summer season but then struggle to find clients during the winter months.
  • Freelancers or gig workers might have periods of feast followed by famine as they hustle for new projects or gigs.

Financial Planning Tips

If you find yourself in a profession with inconsistent income - whether it's due to seasonal fluctuations or other factors - there are some key financial planning tips you should keep in mind:

  1. Save during high-income periods: When you have a good month or quarter with higher-than-average earnings, make sure you're setting aside some of that money for future expenses or leaner times.
  2. Cover essential expenses first: Make sure you have enough saved up to cover your basic living expenses (like rent/mortgage, utilities, groceries) during low-income periods.
  3. Consider having a side hustle: Having another source of income during those lean months can provide stability and peace of mind.
  4. Don't forget about taxes: If you're self-employed or working as an independent contractor (like many pro athletes), remember that you'll need to set aside money for taxes since they won't be automatically deducted from your paycheck like they would be at a traditional job.
  5. Create a budget based on your average monthly income: Instead of trying to budget based on best-case scenarios (like having multiple commissions come in every month), create a budget based on your average monthly income so you don't overspend during high-income periods.

Side Hustle Recommendation

Having a side hustle can be especially helpful if you're just starting out in a commission-based profession like sales or real estate where it takes time to build up your client base and start seeing consistent income coming in.

For example:

  • If you're working as a real estate agent and struggling to close deals during certain months (like December when people are focused on the holidays instead of house hunting), consider picking up some part-time work at a local retail store or restaurant.
  • If you're working as an independent contractor (like many gig workers do) and find yourself without any projects lined up for the next few weeks or months, consider driving for Uber/Lyft or delivering food through DoorDash/Grubhub until things pick back up again.

Having another source of income during those lean months can provide stability and peace of mind while also giving you something productive to do with your time instead of just sitting around worrying about when your next paycheck will come in.


I hope this article gave you some valuable insights into how pro athletes manage their finances and plan for fluctuating incomes throughout their careers! If you enjoyed reading this article as much as I enjoyed writing it please share it with friends who share these interests!

Remember: Take control of your personal finances so you can create the life YOU want!