Changing the game: women are ready to invest in their financial future

Women in sports have come a long way since the passage of Title IX in 1972. This groundbreaking federal civil rights law has not only brought millions of girls and women into athletics, but has required schools, agencies and other institutions that receive federal funding to operate all educational activities -- including sports programs -- equally for women and men.

Over the years, Title IX has empowered female athletes to make significant strides in terms of viewership, performance and pay. In 2024, the Women's Final Four NCAA college basketball semifinals between Iowa and South Carolina attracted 18.9 million viewers, becoming the most-viewed women's college basketball game ever, according to ESPN. In addition, the three-game 2024 NCAA Women's Final Four in Cleveland was the most-viewed Women's Final Four on record, averaging 13.8 million viewers – that's an increase of 114% from 2023 and 299% from 2022.¹

In addition, female participation in high school and college athletics has skyrocketed,² and professional money-making opportunities are also expanding. Television broadcasters and streaming platforms have added more Women's National Basketball Association and National Women's Soccer League games to their lineups,³ and endorsement deal revenues are also on the rise.⁴ Recent changes to NCAA regulations allow college athletes to earn money off sponsorships, and social media has also opened up non-traditional avenues for female athletes to attract fans and business opportunities. WNBA basketball star Caitlin Clark's impressive $28 million endorsement deal over eight years with Nike fell short of the cutoff for Forbes' Highest-Paid Athletes list, but her marketability offers a glimpse into a future where more women athletes could vie for top earnings.⁵

Yet with all of these advances and opportunities, only a few women have made Forbes' Highest-Paid Athletes list. The sports gender pay gap is significant, with NBA players' salaries starting at almost $1 million, in contrast to their female WNBA counterparts, whose highest salaries remain less than one-quarter of that amount.⁶ In women's soccer, the FIFA Women's World Cup prize is $150 million for 2023, still far below the $440 million received for the 2022 Men's World Cup.⁷

Given these and other disparities, many women who have gone on to pursue careers in sports are finding long-term financial well-being elusive.

"Even now, the disparity in wage income is amazing for the female athlete," says Cathy Bender, a Senior Financial Advisor at Merrill. According to Bender, female athletes have often not received the same quality of financial guidance as their male counterparts.

"Many trailblazing female athletes have suffered financially because they didn't receive suitable financial guidance," Bender notes.

Ms. Bender is a trailblazer herself. She was the first Black female athlete to attend Vanderbilt University on a basketball scholarship in 1978,⁸ has been inducted into the Tennessee Sports Hall of Fame, and now uses her experience as a financial advisor to help clients pursue their financial goals.

Merrill's Sports & Entertainment Advisor program equips advisors with specialized knowledge, tailored to the unique needs of high-net-worth clients in the fields of sports and entertainment whose goals are to grow, preserve and transfer their wealth.

Female sports professionals face challenges, such as fewer teams to join, less media coverage, lower pay and smaller sponsorship deals compared to their male counterparts. These constraints are compounded by the fact that if a female athlete decides to start a family, pregnancy can threaten the renewal of her contract, or lead to cuts in sponsorship deals, something that Olympic gold medalist Allyson Felix wrote about.⁹ All of these heighten the importance of having a financial advisor who understands these challenges.

"Female athletes often have small windows of opportunity where the wealth is coming in, that they need to take advantage of," Bender offers, "but sometimes they've been advised to invest conservatively, or have been treated a certain way because they're women, and haven't seen the same returns as men."

Not only is the window of financial opportunity often shorter for women, it also often occurs when the athlete is quite young, according to Merrill Lynch Wealth Management Advisor Leanne Jewett.

"Peak career earnings tend to occur at a younger age for female athletes, so they have to capitalize quickly on a financial plan," Jewett notes. "They've typically put in a lot of hard work and have had to be extremely goals focused. We try to translate that kind of goals-based approach into their financial planning."

The primary ideas Jewett tries to instill in her clients are:

	The power of planning
	The power of starting early
	The power of giving investments time in the market

There are other important statistics that female athletes need to consider, such as that women live longer than men, which means a longer post-career retirement. Childcare is also a major expense for mom-athletes, according to the Women in Sports Foundation. Care for elderly parents may also fall to them.

Additionally, systemic racial inequities have also played a role in excluding many families of color from creating and understanding the complexities of intergenerational wealth.

"Oftentimes, female athletes haven't been educated about the importance of financial literacy," Bender says. "That's why it's so important that female athletes take charge of their finances and find an advisor they trust."

This idea is echoed by Merrill Lynch Wealth Management Advisor, Linda Davila.

According to Davila, "One of the things that's most critical for women to do is educate themselves." Many sports professionals are generally unfamiliar with investment management, tax planning, asset protection and trusts, and estate planning. As these professionals start making money, acquiring basic financial skills is critical. Women in sports are also often deeply connected to their communities, and want to give back in ways that empower recipients.

"Women in sports need to take control of their financial lives and find tax, legal and financial advisors who can help them manage their financial future," Davila recommends.

Merrill's advisors are prepared to serve clients in all stages of their athletic career — at the beginning, their peak years, near-retirement, to retired or starting their second career. For many athletes, the greatest challenge is how to build enough wealth during their relatively short career spans to perpetuate their lifestyle after retirement for the rest of their life.

While both educational and professional institutions still have a way to go to achieve the equality goals of Title IX, the law opened doors for women to step into high-profile and high-earning sports leadership positions, including coaching, broadcasting and team ownership. In 1972, there were only 700 girls playing on high school soccer teams and there were no professional women's teams in the U.S. In 2020, Angel City FC joined the National Women's Soccer League as the 11th expansion team, followed by the San Diego Wave. Angel City FC boasts an unusual ownership structure that includes a growing slate of professional female athletes and celebrities. Their aim is to push for higher salaries, better working conditions and 401(k) benefits.¹⁰ These owners hope this model will spread.

"We're seeing this more and more," says Linda Davila. "Women are taking ownership for who they are and what they're doing.

Merrill offers services with an understanding of the unique positions of women in the sports industry

In recognition of the unique financial circumstances that athletes face, Merrill created a first-of-its-kind professional Sports & Entertainment Accredited Wealth Management Advisor™ (SE-AWMA™) designation, launched in partnership with the College for Financial Planning, a Kaplan Company. Not all financial advisors who hold the additional title of Sports & Entertainment Advisor in Merrill’s Program hold the SE-AWMASM designation.