How to Make the Most of Olympic Gold

The Olympic medal winners can expect big sponsorships—but what should they do with the money?

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Olympic medals are worth more than just glory—they can lead to lucrative sponsorships, speaking engagements, and business opportunities. But Olympians can also struggle with unique financial challenges, including years of earning little money while paying for pricey training and being forced into retirement after a brief career in the spotlight.

"It's easy to get accustomed to a certain lifestyle," says financial adviser Eric Flaim, who is also a four-time Olympian for speed-skating and winner of two silver medals. He encourages his clients, many of whom are elite athletes, to focus on saving and living more frugally than they might otherwise.

"Realistically, you could be one injury away from ending your career. You need to save significantly more than an individual whose job will take them to age 65," says Flaim. He adds that training costs, including coaching, living expenses, travel, and practice facilities can easily exceed $100,000 a year.

Meanwhile, earning potential varies greatly by sport and by athlete. While winning gold can help an athlete stand out, says Flaim, other aspects of their story are also crucial to securing paying gigs post-Olympics. "People love somebody that they would want to emulate, who seems like an all-around quality human being, rather than just winning," he says.

In this year's Olympics, the stand-out stars include gymnast Gabby Douglas as well as swimmers Missy Franklin, Ryan Lochte, and, of course, long-time fan favorite Michael Phelps. Douglas, for example, not only has a riveting story about her sister encouraging her to continue gymnastics, the financial sacrifices of her single mother, and living far from home in order to pursue her training, but she also has a winning personality. readers voted her their favorite gymnast. And, to top it all off, she won gold in the all-around competition, becoming the first African-American woman to do so.

Not all Olympians, though, return home to offers of well-paid sponsorships. Olympian Sugar Ray Leonard recently told the Hollywood Reporter that when he came home after the 1976 Montreal Games, he was disappointed. Sponsors, he says, didn't want to feature an African-American boxer on their products, so he had to turn to the professional boxing circuit to earn a living. Diver Greg Louganis says he also had trouble finding corporate sponsors, which he attributes to his sexuality. Some stars, such as Franklin, opt to forgo sponsorship deals to maintain their eligibility for collegiate competition.

Earning potential varies by sport, as well, with the lesser-known and team sports generally garnering less attention. Even track and field athletes can struggle: A survey from the USA Track and Field Foundation recently found that about half of elite track and field athletes earn less than $15,000 each year through their sport. Earnings, the survey found, depended on the ability to win medals and races as well as charisma, beauty, and fan appeal.

The good news is that Olympians appear to be better prepared to manage their money than the average American. A recent survey of past and present Olympians by TD Ameritrade, an official Team USA sponsor, found that Olympians are more confident with their money, more likely to have a regular savings habit, and more likely to save or invest any windfalls received than other Americans. More than two-thirds of Olympians surveyed said they save for the future and most described themselves as financially stable.

TD Ameritrade managing director Carrie Braxdale says she thinks Olympians' experience with goal-setting and working toward specific goals help them when it comes to developing a plan for their finances. "They're sophisticated when it comes to goal-setting and what actions are needed," she says, adding that they're also accustomed to sacrifice, another useful skill in both athletic competition and financial planning.

Flaim agrees: "When you're an athlete at that level, you understand the power of planning for the long term. You're not just thinking about today or tomorrow." In fact, he says it was his experience as an Olympian, working so hard for a big goal and then finally reaching it, that inspired him to go into financial planning.