You'd be amazed how little being an Olympic hero on Team USA pays

I am an avid Olympics fan, and my heart swelled with pride as I watched LeBron James and Steph Curry obliterate Serbia and South Sudan on the Parisian basketball court. However, while the NBA stars on Team USA are bonafide millionaires (or, in Lebron’s case, billionaires) back home, most Olympians face a much different reality.

The Wall Street Journal published a piece on the financial realities of many US Olympic athletes, and the details are bleak:

A report commissioned by Congress and released in March identified significant financial barriers for Olympic hopefuls. In a survey of about 1,000 American athletes in the Olympic and Paralympic pipelines, 26.5% reported individual incomes under $15,000 a year.

“Some of the most talented competitors under our flag go to sleep at night under the roof of a car or without sufficient food or adequate health insurance,” the Commission on the State of U.S. Olympics and Paralympics wrote…

This year’s report on elite American athletes found they were, on average, poorer for having competed, paying a net cost of about $12,000 a year after accounting for travel, entry fees and other expenses.

Athletes competing in America’s biggest professional sports leagues, such as the NFL, MLB, NBA, and NHL, train year-round, but they are well-compensated for that work, with multibillion-dollar media rights deals funding salaries that can reach tens of millions of dollars.

Olympic athletes are subject to similar strenuous, year-round training schedules, often having to win various competitions just to qualify for the national team, but, unlike their superstar counterparts, they aren’t being compensated for it. In fact, they are compensating, having to pay for their travel expenses and cover entry fees for different events.

Even our most successful athletes have struggled. One of the biggest success stories of the 2024 Olympics has been the venture capitalist-turned cycling champion, Kristen Faulkner. Two years ago, Faulkner published a blog detailing how she balanced working for a venture fund while training for the national team in France in 2020, and her routine sounds grueling:

During the 7-day stage race at Ardèche (France), I woke up at 6am everyday to respond to work emails, and then analyzed financial and business documents while in the team car on my way to each stage. After each stage, I returned to the hotel around 7pm or 8pm, showered, and ate dinner while on Zoom meetings for work. I went to bed at midnight and woke up at 6am the next morning to repeat my routine. At times I did not have time to shower until 11pm or eat anything more than a baguette and protein shake for dinner. I share this story not to tout everything I squeezed in, but rather to let readers know that working a demanding job while racing full-time on another continent is extremely difficult.

This schedule only involved her working half-time for two months. After the tournament, she decided to step away from investing entirely to focus on cycling, but she only felt comfortable doing that after saving money for four and a half years:

I wanted to feel enough financial security so that if cycling didn’t work out, or I didn’t receive a contract with living wage after two years, I had enough savings to live off for six months until I found another full-time job…

After four and a half years of working and saving, I finally had enough savings to feel comfortable leaving my job.

And Faulkner is one of the best-case scenarios: she saved enough from a high-paying job that she was able to focus on training without running out of money. Olympian-turned financial planner Lauryn Williams, who has worked with “dozens of Team USA athletes,” told the Journal that “about 20%” of her Team USA athletes had taken on debt to compete.

What is the ROI on that debt?

For most athletes, a sense of pride and prestige, as the only cash prizes go to medal winners. But even for Olympians who do win medals, the payouts aren’t great. Americans receive $37,500, $22,500, and $15,000 per gold, silver, and bronze medal, respectively. While those winnings are exempt from US taxes for athletes with annual incomes below $1 million (thanks Obama!), all earnings above $10,000 in this year’s Olympics are taxed by the French government, with most winning athletes ultimately owing between 20% and 30% in taxes. Your take home, for being the top competitor in the world in your sport, is ~$30,000.

Why does America pay its medal winners so little when countries like Singapore, Hong Kong, Thailand, Indonesia, Kazakhstan, Malaysia, Azerbaijan, Morocco, Italy, and the Philippines each pay gold medal winners at like $200,000 per medal?

Because unlike most competing nations, the US government doesn’t fund its Olympic medal payouts. A private nonprofit, the United States Olympic & Paralympic Committee (USOPC) pays America’s winners, and its funding is provided by donations and commercial sponsorships. This may have made sense 50 years ago, when The Olympic Games were still amateur competitions, but since 1988, professional athletes have competed in all of the games. To qualify for the US national team, American athletes have to treat their training like a full-time job, which comes with career sacrifices. Maybe the US government should consider copying the example set by competing nations, and pay its winners accordingly.