Money Rehab with Nicole Lapin - Change Maker - Devon Kennard, Athlete, on Paying College Athletes and “Mailbox Money”

Episode Date: July 9, 2021

Not only is Devon Kennard the linebacker for the Arizona Cardinals, but he’s also a philanthropist, real estate investor, soon-to-be financial author and now, Money Rehabber! Listen up for his real estate hacks, tips for negotiating contracts, and more. Learn more about your ad-choices at https://www.iheartpodcastnetwork.comSee omnystudio.com/listener for privacy information.

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Well, it doesn't. Charge for wasting our time. I will take a check. Like an old school check. You recognize her from anchoring on CNN, CNBC, and Bloomberg. The only financial expert you don't need a dictionary to understand. Nicole Lappin. As you know, every Friday we talk with a public figure making change in every sense of the word,

and along the way has been in or is still in money rehab. Today I'm talking to Devon Kennard, linebacker for the Arizona Cardinals. But like any good money rehabber, Devon doesn't have just one stream of income playing football. He is also a real estate investor and soon to be financial author. Devon, I am so excited to have you on the show and hear about all the football, real estate, all the things. But first, a quick game of money rehab, Never Have I Ever. Have you ever played Never Have I Ever? The drinking game. Okay, so this is the money financial version of that with no drinking, unfortunately. So Never Have I Ever maxed out a credit card.

I have not. Nice. Never Have I Ever negotiated a contract? I have. Yeah, you have. Never have I ever bought crypto? I have. Nice. What did you buy? I got into like Bitcoin. I don't got a whole lot, but I dibble and dabble a little bit. It's not really my thing. I stick to real estate. Never have I ever bought a used car. I have. Nice. Have you bought a new car?

Yeah, I bought a new car too. Strategically, because it wasn't going to cost me much more than a used one. So it was like, all right, I might as well just buy it new. But my rule of thumb is typically I don't buy new. Yes. Yes, that is also my rule of thumb. Buy used cars, run them into the ground, sell them later. New cars are a total waste of money. Never have I ever taken out a student loan. I have not.

Never have I ever played the lottery. I've never played the lottery. Nope. Never have I ever cashed in a savings bond. I have not. Never have I ever bought myself a six-figure gift? I have not. This is, I don't know what y'all call it in football, but like what would be the equivalent of a layup? Never have I ever bought an investment property. That's definitely a layup,

but I have, I've definitely done that multiple. done that multiple. I can't wait to hear more about that. Tell me, though, what your relationship was like with money when you were growing up. For me growing up, I had a father who played in the NFL and I got to observe a lot and he did pretty well. But I but I was really young when he was actually playing. So most of my life, it was when he was retired. And I got to see what I did and didn't want. And my parents did well, but I always had a desire to do even better and put myself and my future family and generations. And I took it upon myself to where I was like, my dad did well. He was like first generation, like going to college, getting out of the hood type of

situation. And like it was, I put a lot of responsibility on myself to advance my family much further than that and utilize, you know, the position my dad put me and my siblings in. So that was kind of for at a young age, that was kind of my motivation. I don't really know where it came from. That's not like I grew up talking about finances with my family a lot, but it was always like, if my dad could do this, I got to try to do better type of thing. Wow. So what were the things that you wanted to do differently? And what were the things that you wanted to do the same watching him? I liked that he didn't have to get like a full-time stressful job. So he did well enough and was smart enough with his money where he had some

jobs and some things he did. But for the most part, he was able to do the things he wanted to do. So I like that. But I wanted more. I don't know what everything I want yet, but if I want it, I want to be able to do it type of attitude. And what was their relationship with money? Were they strict? Did they spoil you? Was it a little bit of both? They were pretty strict. You know, I grew up in a good community. And anything I really needed or if I really, really wanted, I pretty much had. But they, you know, they didn't just throw money at me ever. And they really my mom is very conservative.

My mom is very conservative. I always joke and say she's a penny pincher and she still shops at outlet stores and cuts out coupons and does the whole thing. So that really taught me to be frugal with my finances. I mean, rich people stay rich by acting like they're poor and poor people stay poor by acting like they're rich. I think she probably taught you really well by doing that. Yeah, absolutely. I always joke and say the richest people I know, you couldn't even tell. Right? The millionaire is next door. Is that what you wanted? Did you want to just not be able to tell and have a bank account, but not all the flash that goes with it?

I've never been super into the flash. I mean, at this point in my life, in my career, there's certain things that I like, but it's all within reason, depending on how much money you're making, what your situation is, um, and all that. So for me, it was, there were things that I've wanted, but I w I'm okay with delayed gratification. So I rather, I rather be able to splurge and buy things with passive income than, than earned income. So, you know, uh, I played football for a living. My, my dollars have to work just as hard as I work, you know, I played football for a living. My dollars have to work just as hard as I work. Just as hard as I worked for them, they got to work for me. So that was kind of my mindset. And once I'm generating enough passive income,

if there's things I want to splurge on from time to time, then I've earned that right. But for me, I had to earn it first. When did you become interested in football? Did you always think that's what you were going to do because of your dad? I always loved sports in general. I actually, if I could, even to this day, if I could, I'd play basketball. But I started growing this way and not vertically. So I was like, I think my genes are kind of dictating. But sports was always a passion of mine but i had a lot of um injuries even my senior year of high school and throughout college to where i didn't always know um and it wasn't always like a shoe in that i was going to play professionally

so it really kind of pressed on me to figure out and i had to make a decision do i want to be successful if i end up playing football or do i want to be successful no matter what and uh you know the vision i had for my life it wasn't just tethered to football i wanted to be successful no matter what? And, you know, the vision I had for my life, it wasn't just tethered to football. I wanted to be able to live that life period. So I had to start thinking and operating in a way of like, all right, whether I play zero years or I play 10 years, you know, how am I going to live the life that I want to live? What do you mean it wasn't a shoe-in? You were recruited by more than 40 schools. That's not a shoe-in? But once I got to college,

I had a lot of injuries. Like there's, you know, there was a chance I wasn't going to get drafted into the NFL. And, you know, even once I got in the NFL, there's a lot of skepticism of will he, will he actually play? Will he end up getting cut? You know, all those things. And I've been blessed enough to play eight years now. So it's, it's definitely, it's definitely, you know, I've been blessed enough to play eight years now. So it's definitely, you know, a blessing. The average NFL career is three years. So to make it to eight years and be able to do what I do, it's definitely something I don't take for granted.

And it's something that has been a big business. You've referred to college recruiting actually as a business. Can you tell me a little bit more about that? It definitely is. You know, you're trying to, just like any other business, you're trying to get the best talent so you can put the best product on the field. And it's generating income. And, you know, the NCAA and college institutions are using athletes. And I don't know if you saw the reports, but now they're going to start being able to get paid as college athletes.

And I think that's great because there's a lot's a lot of universities and NCAA that's making a lot of money on college athletes backs. And for me, I was like, um, I know that I'm going to school school for free. I'm going to take full advantage of it and try to, uh, try to use them just as much as they're using me to sell tickets and, and, uh, get people to, to support USC football. That's where I went to college. I was like, I'm going to use them and take advantage of this free education. So, you know, that's why I took school seriously and knocked it out as fast as I could. Do you have a sense of how much USC makes off the football team? Like when you were there, was there the same movement that players should

get paid? College athletes should get paid? Everybody said so. Like it was ridiculous that, you know, I'm at USC and we're dealing with guys who are for sure about to go first round or have NFL careers and they're, you know, waiting for a stipend check for $1,200 and more than half of it has to go to rent in downtown Los Angeles. And then the rest is, you know, we're eating peanut butter and jelly sandwiches and training table. You know, it's kind of ridiculous to think that's what our lifestyle is like when, you know, we're playing USC football, competing for national championships and bringing in millions of dollars. I don't know exactly how much, but I know it's a lot. Then you got drafted. You went to play for the NFL. What was the best piece of financial advice you got when you were being drafted?

I don't know if anyone really told me, but I went in immediately with the mindset of like, I'm going to save as much as I can because I didn't know how long I was going to play. But I looked at it as like, I'm 23 years old. I get a chance to make a lot more money this year than any other 23 year old. So I'm going to save as much as I can and meet as many connections, build relationships and try to leverage myself and put myself in position to be successful. And so that was my mindset. So I know I feel like I got made fun of.

But as soon as I got drafted, I drove, I had my high school car shipped out to New Jersey because I got drafted to the Giants. So I shipped it out, and I was driving my high school car for the whole first year. And then I found I got a marketing deal that I leveraged myself with a Kia dealership because I drove a Kia, but my car was having issues. And like when you asked if I negotiated my own contract, well, that's what I did on my own. I worked out a contract in an agreement with the owner of a dealership and I got to drive a car free for three years. And I didn't buy my first car until I got my second contract and and went to Detroit. So that's kind of where like my my mentality. I had to kind of make sure I was

like, I want to put all my money towards investments and savings. And and, you know, I could do all the other stuff down the line. My heart is like bursting. I'm so happy. Hold on to your wallets, boys and girls. Money rehab will be right back. Now for some more money rehab. Nerdy question. You talked about the highest tax bracket, but how do state taxes work for sports? I read that some sports leagues, what you make per game is actually subject to state tax in the state that's hosting the game. Is that true? Yeah.

So you get taxed in every state that you play in. So it gets complicated. You got to make sure you have an account that understands that. But yeah, so I'm in Arizona now. When I was playing in New York, my checks looked a lot different than they do now in Arizona. And so even now I joke and I say I hate going to New York to play because because, you know, it looks a lot less than it does when I'm playing in Arizona or other places. Wow. I mean, it really depends also what city you're playing in

because if you're making $250,000, is that the starting salary? That looks a lot different and different. Yeah. It's growing up. It's going to be like $550,000 this year. So even bottom of the roster guys are making pretty good money. But but yeah, it can look a lot different depending on what city is like you're playing in and where you're where all your away games are. You know, you want to be in a good home base city because, you know, you're playing home at least eight games.

So if you're if you're in a high taxx home stadium, then that really sucks. Because eight games, you already know you're getting taxed the worst. And then you just got to see where else you're playing from there. Yeah, New York, California, probably. You get paid in other things. But being in Arizona, I like because the tax situation there is much more favorable. In March of 2020, you reportedly signed a three-year $20 million contract. And based on what we talked about, it's not $20 million in your pocket. What was

that negotiation like? That's still, I mean, even with all the taxes and all the stuff taken out, that is amazing. Yeah, it was definitely a huge, huge blessing. And it was actually my second big contract that I signed. I signed one in Detroit. And uh it was actually my second big contract that i that i signed i signed one in detroit um and then i was actually released from detroit uh for essentially negotiation reasons i wanted more money and uh and then i signed a new deal with the with the cardinals and uh negotiation went well as soon as i was released from detroit there was interest right away and my agent got to work he did most of the groundwork i you know i'm a firm believer i um i earned i earned my payday on the football field i let my agent do his do his work from there so he negotiated a good deal

i had a number in my head that i wanted to hit and he was able to um to hit it and uh you know now now you know get to play home in my hometown I mean, and then you get paid in just doing that, which is priceless, it sounds like. Yeah, absolutely. So when did you start getting into investing? Was it with real estate investing at first? Yeah, I actually, so I kind of mentioned earlier, but my college career was really shaky. I had some injuries I had a lot of position changes I wasn't sure if I was going to play in the NFL and have

the kind of career I always had confidence but you know there was days where it was like I don't know if it's going to happen so I started trying to figure out what else I was going to do and I met a mentor and he started out as a police officer and a special education teacher. And he bought one property, turned into two, turned into three. And now he has a property management company in California. And him and his partner own over 4,500 units in L.A. And just hearing his story, sitting down, talking with him, that was really inspiring. And just hearing his story, sitting down, talking with him, that was really inspiring. Because I'm like, if he was able to build that off of a teacher and police officer salary,

if I only play one year in the NFL but leverage it right, I can put myself in position and give myself a really good head start. So that was my mindset. And after my first year, I went to a couple of real estate meetups in Arizona with a partner of mine who used to go to USC with me. And we bought our first property in Indianapolis. And I never looked back after that. So what does that mean? How many properties do you have now? So I now own 15 properties of my own, but I'm also in 40 other syndications. I'm not sure how familiar you are with that, but I'm a limited partner in a few of them. I'm a general partner in big syndications all across the country from apartment complexes, single family homes, to senior living, to warehouses. I kind of try to

reach and touch all the bases in different fields and different industries and invest and collect what I call mailbox money every month and just push up what my passive personal portfolio and then finding people who are already syndicating really good deals and networking with them, connecting with them, investing alongside them and reaping the benefits. So here's a tip from Devon you can take straight to the bank. I think everybody should adopt the mindset of building passive income, of mailbox money, of looking at and creating multiple revenue streams. I think I think it's essential. I think that's what the new American dream is. There's more ways now to make money than ever before in our our society and in life. So everyone should take advantage. You know, you can have a nine to five job and sell stuff on Etsy that you like making and make some nice chump change.

And then that you could start to put into your first investment property and like and just let things start to feed each other. And you'll be amazed at where you can be five years and 10 years from now if you start doing that. Money Rehab is a production of iHeartMedia. I'm your host, Nicole Lappin. Our producers are Morgan Lavoie and Catherine Law. Money Rehab is edited and engineered by Brandon Dickert with help from Josh Fisher. Executive producers are Mangesh Hatikadur and Will Pearson. Huge thanks to the OG Money Rehab supervising producer Michelle Lanz for her pre-production and development work and as always thanks to you for finally investing in yourself so that you can get it together and get it all You spend my money, money. You spend my money, money, money.

You spend my money, money, money.