They'll pay somewhere close to $600,000-$800,000 of income tax right off the top of that $2 million so they're not even starting out with $2 million. But I get it, I really do. That type of money is too tempting for not only most kids but the kids' families. They only see the immediate impact of the money, but most never consider the long term of how little that is, especially considering a lot of the players are expected to support more than just mom and dad.
I’d bet the farm that little, if any, of that up front NIL money for maybe 95% of the kids that get it gets invested through a knowledgeable financial management professional. And that 95% may be too low.
If you properly structure the pay-for-play payments to minimize taxes, invest what you do get, and make the most of the free education you're being given, $2 million in gross seed money at 18 years old can in fact set you up for life.
But you're right -- a minuscule percentage of recipients would do that. Not only do they have an 18-year-old's cerebral cortex, they don't know anybody who could provide competent and benevolent counsel. They probably don't know anybody who knows anybody who could. And even if they did, the chances of following the advice are slim to none because of that 18-year-old cerebral cortex.
They're surrounded by people who have no concept of the limitations you cite on the money or the benefits of not blowing it on cars, strip joints, and payroll for the entourage the hangers-on want to be a part of.
Sad. But for way too many of them, the money might as well have been kindling for a campfire.