Adapting a program developed for pro athletes, Morgan Stanley helps educate West Point cadets on how to invest, spend, and save money wisely.
What do NBA rookies and West Point juniors have in common? Besides being in peak physical fitness, both groups face decisions about handling more money than they have likely seen in their lives. And both have recently had the opportunity to learn from Morgan Stanley’s Global Sports & Entertainment on the value of financial literacy and having a forward-looking financial plan.
The money management pitfalls faced by professional athletes are well known; those faced by new military officers less so. They may never sign a ballplayer's multi-million-dollar contract but as new officers just starting their career they still need to plan ahead for their future, juggling expenses such as setting up a home near their new post and the costs of uniforms and transportation.
The similarities between the two groups didn’t go unnoticed by the Global Sports & Entertainment team, which has been providing financial literacy programs to top-tier colleges and professional sports teams for the past two years. “With either group, these conversations all revolve around the same topics: 'Make it, help protect it, save it, and grow it.' Whether it's college students or professional athletes, those are the four fundamental areas,” said Drew Hawkins, Managing Director of the Global Sports & Entertainment Division.
West Point Academy's 450 "Cow Year" cadets listen in on the benefits of having a solid financial plan.
This was a great opportunity to educate this talented group of individuals who are going to do great things for our country.
Former West Point graduate Jeff McMillan, a Morgan Stanley Managing Director, says the FinLit seminar is highly needed, since service members are sometimes targeted by financial bad actors, from payday lenders to sellers of high-load investments. Junior year is the perfect time to receive a financial message that these future officers can use their entire careers.
“Some of those kids, when they're 65, are going to be grateful for what you told them in the hour you spent with them. This is a group of people who need to learn financial management skills,” said McMillan, who also co-chairs Morgan Stanley's Veterans Employee Network Group. “People walked away feeling empowered to manage their financial lives.”
At the recent event, former Baltimore Ravens and New York Jets linebacker Bart Scott led the discussion, just as he does for professional and college athletes. The program was customized to answer the more than 450 cadets' questions on the financial realities of military life, but the cadets also participated in the same fun learning exercises that pro athletes do.
One activity has students rank financial moves such as “invest in real estate,” “consolidate debt,” and “create an emergency fund.” Another has one student role play financial decisions such as renting versus buying a home and how much to spend on a car and other items. Then the presenters annualize the effects of those decisions, showing cadets the long-term repercussions of day-to-day choices. These activities get the discussion rolling.
Using real-life scenarios, Morgan Stanley Global Sports & Entertainment's presentation prepares cadets for their financial futures.
Sports metaphors go over well with West Point cadets. For example, the presentation uses a basketball court to explain the different potential returns for safer and more aggressive investments, with reliable but modest returns happening in the 2-point area, and riskier opportunities with larger potential payoffs happening outside the 3-point line.
The cadets were clearly engaged, asking detailed questions and crowding to the front afterward to ask further questions—and meet Scott, of course.
Hawkins is delighted that West Point has already invited his group back for next year. “This was a great opportunity to consult with this talented group of individuals who are going to do great things for our country—making it fun and interesting for them as opposed to pointing our finger at them and telling them what not to do,” Hawkins said.