The emergence of name, image and likeness compensation has transformed college athletes into earners, business counterparties and potential investment clients, often within months of leaving high school. Congress is now considering a broad attempt to impose national order on that market, but the proposal’s financial protections stop short of assigning any one professional an ongoing duty to safeguard an athlete’s wealth.

The Protect College Sports Act of 2026 would establish a federal right for college athletes and prospective athletes to receive compensation from commercial uses of their NIL. It would replace conflicting state rules in several areas, impose disclosure requirements on certain agreements, regulate agents and give athletic organizations authority to enforce rules governing compensation, recruiting, eligibility and transfers.

The Senate Commerce Committee advanced the measure, designated S. 4668, by a 19-9 vote on June 18. It now awaits consideration by the full Senate. Supporters describe the bill as a comprehensive response to the instability that followed the expansion of NIL activity and the introduction of direct institutional revenue sharing. Passage is not assured, however, because the measure would need sufficient support to clear the Senate and would also have to move through the House.

For athletes negotiating endorsement contracts, one of the bill’s most visible provisions is a 5% ceiling on agent fees. Agents would have to register with a state and certify their compliance with applicable athletic-association rules. They could not extend an agency agreement beyond an athlete’s collegiate eligibility or use false or deceptive representations to attract clients. The proposal would also create a searchable agent database and allow sanctions against agents who violate covered requirements.

Those provisions could make fees easier to compare and limit the amount removed from an athlete’s gross endorsement proceeds. They may also provide families with a clearer method of checking whether an agent is properly registered. But a limit on one intermediary’s compensation does not ensure that the remaining money is preserved, invested appropriately or available when tax and contractual obligations become due.

Kirk Loerwald, a partner at SAX Wealth Advisors who leads the firm’s Athletes & Artists division, warned that the legislation does not address the absence of comprehensive fiduciary oversight. In comments published by InvestmentNews on July 10, he argued that agent charges are only one part of the financial risks facing young athletes. Tax planning, financial education and the cumulative cost of attorneys, accountants, managers and other service providers remain outside the fee cap.

The distinction between transactional representation and ongoing advice is central to the concern. An agent may be retained to identify opportunities, negotiate compensation and close an endorsement agreement. An attorney may review legal language, while an accountant calculates tax liabilities. A financial adviser may manage cash and securities. Each can perform an important function without necessarily accepting responsibility for every component of the athlete’s financial life.

The proposed law would prohibit certain agent misconduct and give athletes legal avenues to enforce specified rights. It would not, however, expressly require an agent to act as the continuing fiduciary for an athlete’s full balance sheet after a transaction closes. Nor would it require every athlete to engage a registered investment adviser, independent attorney or other professional charged with evaluating whether an agreement supports the athlete’s long-term interests.

That gap is significant because NIL compensation frequently arrives before an athlete has experience with budgeting, estimated tax payments, insurance, investment risk or business entities. Income may also be volatile. A highly publicized contract can be short in duration, dependent on continuing eligibility, tied to social-media activity or terminated if an athlete transfers, is injured or loses public visibility. Treating temporary income as permanent wealth can lead to commitments that remain after the endorsement revenue ends.

Taxes present another layer of complexity. NIL payments can create federal, state and local obligations, while athletes who attend school, maintain a permanent residence and perform commercial activities in different jurisdictions may need coordinated professional guidance. Gross compensation can therefore overstate the amount available for spending or investment. A fee cap does not reserve funds for taxes or ensure that an athlete understands when payments are due.

Contracts can also contain provisions with effects extending beyond the payment itself. Exclusivity clauses may restrict future sponsorships. Intellectual-property provisions can determine how long a company may use an athlete’s likeness. Privacy terms, content-production requirements, morality clauses, termination rights and brand-category restrictions can all affect future earning capacity. An attractive headline value may obscure obligations that reduce the contract’s economic benefit or limit subsequent opportunities.

The risks are heightened when prospective college athletes begin signing agreements at 16 or 17. Parents or guardians may be involved, but family involvement is not equivalent to independent financial expertise. A parent can be deeply committed to a child’s welfare while lacking experience evaluating commercial contracts, adviser compensation, investment products or the conflicts that may arise when multiple professionals expect to be paid from the same income stream.

Loerwald has suggested two safeguards that are absent from the current proposal: independent review of NIL contracts before execution and a financial-literacy requirement paired with credit monitoring before compensation is distributed. Independent review could help separate the professional assessing a contract’s risks from the person paid to complete the transaction. Financial education could prepare athletes to distinguish gross income from spendable cash and recognize fraud, identity theft and unsuitable financial products.

The bill does contain protections extending well beyond agent fees. Its sponsors say athletes would receive a private right of action to enforce NIL, scholarship, medical and agent-related provisions. Division I institutions would face medical-coverage obligations, including post-eligibility support for certain sports-related conditions. Scholarships generally could not be withdrawn because of injury, athletic performance or roster-management decisions, and an athlete ombudsman would provide independent guidance on rights and disputes.

Those provisions may improve athletes’ bargaining position within college sports, but an ombudsman is not the same as a personal wealth adviser. Resolving a dispute with a school or explaining statutory rights differs from determining an appropriate emergency reserve, reviewing an investment portfolio, coordinating insurance coverage or planning for income that may disappear after a brief athletic career.

Existing securities regulation offers protection when an athlete formally enters an investment-advisory relationship. The Securities and Exchange Commission states that investment advisers must act in a client’s best interest and not place their interests ahead of the client’s. SEC guidance also emphasizes understanding a retail investor’s income, assets, debts, tax position, time horizon, liquidity needs, experience, objectives and risk tolerance before providing advice.

However, those duties attach to defined professional activities and relationships. They do not automatically convert everyone described as an adviser, manager, consultant or representative into an investment fiduciary. They also do not necessarily cover the negotiation of endorsement contracts, legal interpretation or tax preparation. Athletes and families must therefore understand which professional is responsible for each decision, how that professional is compensated and where the scope of the engagement ends.

A coordinated advisory arrangement could include an independent attorney for contract review, a certified public accountant for tax compliance and a registered investment adviser for planning and portfolio management. For athletes with substantial earnings, the structure may resemble a compact family office, with documented responsibilities, shared information and controls over disbursements. The objective is not to multiply advisers, but to prevent gaps and duplicated fees.

Conflicts should also be disclosed in plain language. An agent may refer an athlete to a financial professional, attorney or business manager with whom the agent has a commercial relationship. An adviser may receive compensation based on assets placed under management. A manager may charge a percentage of income or arrange services through affiliates. Even when lawful, those incentives can influence recommendations and should be evaluated before funds or decision-making authority are transferred.

The market’s uneven economics make a statutory solution difficult. The most valuable football and basketball players may generate enough income to retain sophisticated advisers. The much larger population of athletes receiving modest, irregular or one-time payments may not. A mandatory professional team could consume an unreasonable share of smaller deals, while leaving advice entirely optional can expose inexperienced earners to preventable losses.

That disparity creates a potential two-tier system. Athletes with large contracts can obtain legal review, tax projections, cybersecurity services and diversified investment management. Athletes earning less may face many of the same contractual and tax questions but rely on informal guidance. The 5% agent cap applies to both groups, yet their capacity to absorb professional costs and recover from mistakes is markedly different.

Schools also face a delicate role. Athletic departments may provide education and general resources, but coaches and administrators are not necessarily licensed to give individualized financial, legal or tax advice. Recommending private service providers can create concerns about endorsement, conflicts and institutional responsibility. A national curriculum, vetted referral network or subsidized independent review program could offer broader access without requiring schools to manage athletes’ personal portfolios.

For wealth-management firms, the NIL market presents both an opportunity and a suitability challenge. Young clients may have sudden income, concentrated career risk and limited financial experience. Advisers serving them need processes for family involvement, age-of-majority transitions, privacy, cash-flow forecasting and the possibility that athletic earnings will not continue. Conventional assumptions based on stable salaries and decades-long careers may be inappropriate.

Advisers must also resist using an athlete’s visibility as a substitute for normal client protections. Public prominence can attract speculative investments, private deals, requests from acquaintances and pressure to support extended networks. A disciplined plan may prioritize liquidity, tax reserves, basic insurance and diversified holdings before complex products or illiquid ventures. The appropriate strategy depends on the athlete’s circumstances, but the need for documented, conflict-aware advice is consistent.

The bill’s transfer limits add another financial dimension. It would guarantee one transfer without a loss of eligibility, with exceptions for certain additional moves, while generally attaching a penalty to a second transfer. Supporters view the rule as a source of stability. Critics may argue that reduced mobility could affect an athlete’s negotiating leverage and future earning opportunities. Any interaction between transfer restrictions and the economic value of representation is likely to receive further scrutiny.

The broader legislation also seeks to preserve women’s and Olympic sports, regulate revenue sharing, support post-eligibility medical coverage and provide targeted antitrust protection for covered college-sports rules. These institutional objectives explain why the proposal addresses far more than individual wealth management. They also make amendments politically complicated, as changes affecting athletes, conferences, schools and broadcasters can alter the coalition supporting the bill.

As the legislation moves toward possible floor consideration, fiduciary oversight may become a test of how Congress defines athlete protection. A statute can regulate agent fees and deceptive behavior without ensuring that each athlete has someone responsible for reviewing the entire financial picture. Closing that gap could involve independent contract review, baseline education, clearer role disclosures or access to qualified advisers rather than a single universal mandate.

Until additional safeguards are enacted, the burden will remain largely on athletes and families to assemble their own protections. They will need to verify registrations, compare compensation structures, document professional responsibilities and determine who is obligated to provide continuing advice. The proposed law would bring greater uniformity to NIL transactions, but it would not by itself transform endorsement income into durable wealth.