Fantasy football has long been a popular game among friends, co-workers and families as a means of entertainment and competition during the NFL season. I willingly admit my fascination with the game and continue to learn valuable lessons each year that help me in my quest for the championship.
Parents often struggle to find ways to connect with their teenagers and while I don't condone teaching your children gambling, getting your children involved in fantasy football can create valuable lessons that translate well into the financial world.
If you've played fantasy football then you are familiar with the term "kicking yourself". This often refers to the self-loathing that occurs after you played a bad quarterback matched up against a bad defense with the expectation that the quarterback has a magical day. By Sunday night you realize that you simply played a bad quarterback. Meanwhile, Peyton Manning throws 4 touchdown passes in cold weather against the best defense in the league... on your bench.
Taking financial risks can be a very similar experience. When making investment decisions, it is important to understand the facts and possible outcomes. The last question being "Can I live with myself if this fails?" If you have done your homework, understand the downsides of the investment and feel the risk is worth the reward, then you should be able to live with the result. Great investors understand these trade-offs between risk and reward and are generally able to sleep at night knowing they made the best decision given the information.
Finding the coveted sleeper
Finding value is an important aspect of fantasy football. Championship teams are made in the late rounds of the draft and on the waiver wire by finding the players that outperform their projections. Did you draft Browns WR Josh Gordon this year despite a 2-game suspension to start the season or pickup Rams RB Zac Stacy after the injury bug hit St. Louis?
Finding the next great sleeper is about recognizing value before it becomes general knowledge. Once everyone knows about it, the value diminishes. This skill can help your children be proactive in finding simple deals on everyday purchases or eventually larger purchases such as a college education or a car. Not to mention, the ability to discover value investments can have a great impact on your net worth in the long run.
Knowing when to walk away
Ever have your stud running back turn into a dud? Past performance and name value can make a player very hard to drop. Just ask Ray Rice owners this year. One of the most difficult parts of fantasy football is learning to let go. It's never easy admitting you were wrong but if you don't, you will ride your team to the basement.
Financial mistakes are going to happen. Hopefully you are teaching your children about money and using tools such as an allowance to lessen the odds of big future mistakes. Learning to address problems as they arise and move forward can be an invaluable tool in the investment world and life. Whether it is making a poor purchase or poor investment, you can use these experiences to better your decision-making in the future and cut your losses.
Surrounding yourself with knowledgeable people
While I enjoy fantasy football, I am far from an expert. I rely on great, experienced analysts to help me shape my draft and weekly roster decisions. After all, they are doing this day in and day out at a level that I could not possibly attain as I tend to my family and career. Success is very difficult to achieve alone. Everybody needs a good team to help them win championships consistently.
The ability to form a talented team of people is a fantastic skill children need as they approach adulthood. Hiring a financial advisor or investment manager has shown to greatly increase your odds of financial success. I firmly believe that anyone can become an expert in investment management, fantasy football or any other skill for that matter. However, if you are not willing to put in the endless hours of work to become an expert, find the people already doing it and get them on your team.