Former professional hockey player Kent Manderville has understood the importance of financial planning since he was a child when his father died at the too-young age of 42 in a car accident.
His parents had previously purchased mortgage life insurance on their home in Redwater, Alta., 60 kilometres north of Edmonton – a wise decision that Mr. Manderville says gave his mother the financial backing to cope with suddenly being a single parent to three young children.
“It gave her the financial flexibility to move us all to Victoria, where her parents were. Otherwise, we wouldn’t have been able to afford it,” says Mr. Manderville, who was eight years old at the time. “[Having that insurance money] also allowed me to play competitive hockey which, especially back then, wasn’t cheap. … Their decision had a huge impact on my life.”
While playing for 12 years in the National Hockey League (NHL) for teams such as the Toronto Maple Leafs, Edmonton Oilers, Hartford Whalers/Carolina Hurricanes, Philadelphia Flyers and Pittsburgh Penguins, Mr. Manderville also witnessed players die unexpectedly without a will or lose hundreds of thousands of dollars to bad investments.
“I’m now 50 [years old] and I see the cumulative effects of bad advice – and I’m not even talking about the huge things that end up on TV. Everybody has a story,” says Mr. Manderville, who retired from professional hockey in 2007.
His story, specifically, is about a former agent who talked him into buying universal life insurance early in his career, which would have left him with no liquidity if his career had been cut short.
Today, Mr. Manderville is a private wealth adviser and director of the Hockey Family Office, the hockey wealth management division of IP Private Wealth in Ottawa. Hockey Family Office was established in January to provide hockey professionals and their families with wealth management services ranging from investing to tax and estate planning and philanthropy.
He sees his role as helping players grow and protect their wealth for the long run. “What I want to do is make sure the guys get a fair shake.”
Many professional athletes have specialized coaches for playing, sleeping and nutrition, but not their finances, which Mr. Manderville thinks doesn’t make sense given their unique circumstances.
“It’s important for young professionals who are making good money to have financial literacy. With hockey players, it’s even more important because of the sudden wealth syndrome,” says Mr. Manderville, who is a chartered financial analyst and received his certified financial planner designation in September, 2020.
NHL player salaries are also subject to taxes in different jurisdictions and the money they earn often needs to last well beyond their on-ice careers.
“I see too many players taking on too much risk without an understanding that the window of opportunity that they have in their career is so short. I played for 16 years, and in the totality of my life, that’s still short,” he says. (His career also included four years of playing professional hockey in Europe).
And while he played the centre position in his hockey career, Mr. Manderville sometimes acts like a goalie in his adviser role, helping his clients deflect bad investments that can come at them continuously from family, friends and acquaintances.
“We become the buffer,” he says. “Nobody wants to be the person that turns family members down. … It’s also an opportunity to educate the player about why the investment might not be good for them. It’s about understanding risk.”
He also helps players with the career transition away from the NHL, which he says can be particularly stressful if they don’t have a plan.
“If you’re making good money in the NHL, it becomes less of an issue, but it’s really about risk management and preservation of capital – protecting cash flows, being tax-efficient and really working with them every step of the way through their career transition,” he says. “What we want to do on the investment side is build a portfolio that drives enough income so that when they do make the transition, the pain isn’t as bad.”
Mr. Manderville also helps professional athletes cope with the psychological transition of changing careers, which he says can also be very stressful for them and their families.
“I’ve been there. I went through the transition and I know what it’s like to wake up in the morning and nobody cares where you are,” he says. “Hockey players are very programmed; they have a schedule; they get told where to be at what time; and then, all of a sudden, they’re off the conveyor belt. Not only do you have to worry about the income cliff, but there’s also the psychological impact, and that’s part of the holistic piece that we bring to the table.”
Mr. Manderville has always been interested in wealth management. He has a finance degree from Cornell University in New York, where he also played hockey from 1989 to 1991, and remembers fondly an opportunity he had in Philadelphia about 20 years ago to spend an afternoon with Jack Bogle, founder and then chief executive officer of The Vanguard Group.
“My wife was laughing at me saying, ‘Why are you so nervous,’” he recalls. “It was like meeting a rock star – his passion and his crusade for the small investor. That really made an impact on me.”