Playing video games all day can make you some serious cash.
In fact, some professional gamers make so much money that one financial adviser has built his entire business around telling them how to spend and save.
Galen Herbst de Cortina, 29, spends 10 to 15 hours per week playing games like Faster Than Light, Celeste, Hearthstone and RimWorld. About three years ago, he started training to become a financial adviser, with XY Planning, a Thousand Oaks, Calif.-based network of fee-only advisers who primarily serve Generation X and Generation Y clients. He has worked full-time as an adviser for about a year and a half.
His two worlds collided and a new career was born after he attended video game conferences — TwitchCon and the Electronic Entertainment Expo among others — and met fellow game enthusiasts who needed help managing their earnings.
“I saw a lot of people making money and saying they didn’t know what to do with it,” Herbst de Cortina said.
Gamers can make money when they broadcast video of themselves playing on streaming platforms like Twitch and fans tune in to watch. The gamers on Twitch make money primarily from streaming advertisements during their play and from viewers who pay them through either a subscription on Twitch, or tips that viewers send them to show their appreciation.
The digital gaming industry is growing. There were 2.6 billion casual video game players in 2017, up from 100 million in 1995, according to Goldman Sachs GS, -0.41% There are also some 400 million viewers worldwide of video games, half of whom don’t even play video games themselves, Goldman found. The bank predicts that the e-sports industry, which views professional gaming competitions, will be worth $1.1 billion in 2019.
Herbst de Cortina took his certified financial planner exam in July 2016 and will complete his certification in March 2019. Now, about 75% of his entire client list is made up of professional gamers, amounting to about a dozen gaming clients.
They are all between the ages of 21 and 29, and playing video games is a full-time job for all of them. Most of them make between $75,000 and $250,000 per year, Herbst de Cortina said.
And some make more than that. The gamer Tyler Blevins, who goes by the name “Ninja,” has more than 7.1 million followers on Twitch and 4.4 million followers on Instagram FB, -0.42% He makes more than $500,000 a month playing the game Fortnite, he told CNBC this year.
How video gamers make their money
Think of how a Hollywood star makes money, Herbst de Cortina said. Video gamers are now performers and broadcasters when they appear on streaming. And once they become popular, they rake in money from not only ads and “tips,” but also from endorsement deals, merchandise and advertising on their personal social media accounts.
There are some misconceptions about what these gamers do, he said. Friends and family members sometimes ask them, “Do you do this with your clothes on?” Herbst de Cortina said. “They hear, ‘Oh, I do video stuff online,’ and they immediately think porn, not gaming.”
Some younger clients even dropped out of college because they were making a full-time living gaming, Herbst de Cortina said. Many gamers, especially popular ones, spend eight or more hours per day, six days a week.
Viewers like to see not only their strategies, but also their reactions to the games. On camera, they have to be engaging and entertaining, and then off camera, they’re running a business, he said.
Financial advice for gamers (and other freelancers)
Some gamers find themselves suddenly “accidental business owners,” Herbst de Cortina said. As independent contractors, he advises them to separate their business and personal finances. There’s a growing cottage industry of lawyers, e-sport managers and accountants who advise gamers.
Like other freelance workers, gamer income can be unpredictable. He advises his clients to pay quarterly taxes and gives guidance on retirement planning and budgeting.
Herbst de Cortina advises gamers to get disability insurance because they’re working so many hours per day and would be left high and dry if they suffered some kind of injury like a sprained wrist or suffered repetitive strain injury. But many companies are not willing to underwrite policies for gamers because they don’t fully understand the industry yet, he said.
What the future holds
Twitch recently added a feature called “IRL” streaming, meaning “in real life,” where streamers show more of their day-to-day lives. Negaoryx, a 25-year-old gamer, said she’s raising money from her viewers for St. Jude Children’s Hospital and will live stream a trip to Disneyland DIS, -0.12%
Is the gamer lifestyle sustainable? Herbst de Cortina said yes. Some of his clients have started making long-term investments, including retirement accounts and real estate. “This form of entertainment, I’d be shocked if it goes away,” Herbst de Cortina said.