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The Olympics and Money: Winners and Losers

August 17, 2016 by Lazy Man 2 Comments

I have to start this article with a few disclaimers.

1. I haven’t watched much of the Olympics this year… probably about 3-4 hours total. I know there are people who watch more than that each day. They can tell you all the details about each Olympian’s life to a degree that I can not.

2. There are some obvious winners when it comes to the Olympics (See: Bolt, Phelps, etc.).

3. Every country is likely to have a different economic system for coaches, athletes, etc. The examples I found are mostly about the United States, but I wanted to make this article a little broader.

Behind the obvious winners it seems to me that there’s a lot of losers when it comes to the Olympics.

Losers: The Athletes

There’s no shortage of stories about Olympic athletes having financial difficulty. Here’s what Money Magazine wrote about cyclist Bobby Lea:

“Actually, for Lea, cycling has been less like a pot of gold than a money pit. The most he’s ever earned in a year is $32,500. He has $10,000 in the bank, zero retirement savings, and $19,400 in credit card debt. His parents have spent tens of thousands of dollars supporting his efforts…”

If that isn’t bad enough, Lea’s only experience in the workplace is making subs when he was 17. There’s potential for endorsements, but they aren’t a strong possibility for his type of cycling. Coaching is always an option too.

Need another example? The Wired writes: It’s Really Hard to Make Money as an Olympian.

Finally, this Washington Post article gives a more aggregate view:

“There is no comprehensive data on U.S. Olympic athlete pay, but information collected by a nonprofit last year from 150 track and field athletes ranked in the top 10 in the country in their events found an average income of $16,553.”

And let’s not getting into the topic of taxing gold medals.

Losers: The Athletes’ Parents

It’s one thing for the athletes to not get paid an income, but we should consider the parents as well. The Bobby Lea story above explained that his parents have spent tens of thousands to support him, but they aren’t alone.

Back in 2012, one of my favorite writers, Kimberly Palmer wrote Why Olympic Athletes’ Parents Go Broke“… Gymnast Gabby Douglas’s mother, Natalie Hawkins, who filed for bankruptcy, and Ryan Lochte’s parents, who are facing foreclosure”

Obviously, these Olympians have been successful enough to more than cover the financial problems of their parents. However, there’s just a handful of these famous names who make the big money. As the article explains further, the costs of training can be as high as $100,000 a year. (Though the Wired article shows it can be a more “reasonable” $20,000 range number for runners and swimmers.)

Losers: The Host City

I remember Boston was bidding for the Olympics and the locals were praying that they didn’t get it. It became a big political fight. Why?

As Five Thirty Eight writes, Hosting The Olympics Is A Terrible Investment. From the article:

“The 2014 Winter Games in Sochi blew their budget by 289 percent. The 1980 Winter Games in Lake Placid overtopped projections by 324 percent. And the 1976 Games in Montreal ran a staggering 720 percent over projections; the city spent three decades paying down the bill.”

and as one expert, David Goldblatt notes:

“There’s this kind of relentless underestimation of costs, because if anyone knew the real bill at the beginning they would never sign up… people have been getting away with a sort of statistical and accounting murder.”

If there’s a silver-lining to any of this, I’m adding “statistical and accounting murder” to my lexicon. Unfortunately, I’ll be needing to make a lot of use of it.

Winners: The International Olympic Committee and Other Executives

The aforementioned Washington Post article seems to show that the Olympic Executives seem to be making the real money:

“At the very top of ‘the Movement’ sits the International Olympic Committee, a nonprofit run by a ‘volunteer’ president who gets an annual ‘allowance’ of $251,000 and lives rent-free in a five-star hotel and spa in Switzerland.”

Is it just me, or can you hear John Oliver’s voice in your head mimicking the volunteer saying, “No, I need MORE than a quarter million dollars. It must be MORE“?

The article covers a lot more like the USA Swimming Executive Director who makes $854,000 a year. The article focuses largely on groups in the United States that obviously wouldn’t apply to some smaller countries.

A Final Olympic Thought

I’m probably not going to write about the Olympics again this games, so I wanted to get one last thing in. I was searching through my archives and found that 8 years ago, I wrote about the the injustice done to Alicia Sacramone in the 2008 games. At the time, I wrote, “I have to wonder what might become of Alicia Sacramone.”

It seems like she’s done well enough. She is considered one of the most decorated gymnasts in history. She married NFL quarterback, Brady Quinn. Earlier this month, they welcomed their first baby into the world. Let’s end this on a happy note and put her in the Olympic “Win” column as well.

Filed Under: News Tagged With: Olympics

Many Americans Can’t Afford $400 in an Emergency

May 5, 2017 by Lazy Man 2 Comments

Earlier this month, Lazy Man and Money quietly turned 10 years old.

The economy has changed a lot in that time. If I had to pick one highlight, it would be when the entire banking system collapsed when I went on vacation to Australia/Thailand for a month. (Just this one time, I’ll purposely confuse causation and correlation, because it makes for a better story.)

However, one thing hasn’t changed… many Americans are unprepared for relatively small unexpected emergencies such as a car repair.

The latest information is highlighted in this article in The Atlantic. The article cites that the a Federal Reserve Board survey shows that 47% of Americans said that they’d cover a $400 expense by borrowing or selling something.

That sent shock-waves around the news sites that I follow on the Internet.

However, it shouldn’t have been a surprise to long-time Lazy Man and Money readers. Last year, I wrote How Much Emergency Fund Should You Have? where I cited this research that 64% of Americans don’t have the money for a $1,000 emergency expense.

(I hope that someday, someone will ask about $500 which should come in at over 50%. That way I’ll be able to make a simple statement of “Most people don’t have $500 in emergency cash.”)

The easiest solution is to Dobot, which is a free service that periodically squirrels away small, unnoticeable amounts of money in separate bank account. I have saved $1100 in my Digit account. You can read my Dobot review here.

Seriously sign up for Dobot now. Don’t make me figuratively hit you over the head with this.

However, if I can help 47% or 64% of Americans be better prepared for the inevitable emergency, it’s worth a couple of paragraphs, right?

There’s much, much more going on in the The Atlantic article. I’ll be referencing The Atlantic article all week (maybe even two weeks) as it covers.

Tentatively, I plan to write about the author’s obstacles to secure his financial future. I also hope to cover the story of a local (to me) high school student who may change the future for my state.

Filed Under: News Tagged With: American economic crisis, emergency fund

The Genius of Weird Al Yankovic

July 23, 2014 by Lazy Man 2 Comments

For those who haven’t been disconnected from the world over the last couple of weeks, “Weird” Al Yankovic has been busy promoting his new album Mandatory Fun. It’s an ingenious promotional campaign where he put out new videos every day for over over a week.

Personally, the last thing I remember from him is Amish Paradise. That was nearly twenty years ago and it has been thirty years from his heyday in the 1980s. Everything is cyclical and Weird Al is showing that he still has some cheese on his fastball (to evoke my favorite Eckersleyism… hopefully the “weird” and you can see why he’s been successful.

I’ve been racking my brain for hours trying to come up with anyone who has done it better. I can’t think of anyone who has one of these:

Weird Al being weird – via The Atlantic

This has got me thinking about the value of being an expert versus being good in a lot of little things. I find it very difficult to focus on one or two things. I know this may not surprise anyone given my previous cheese tangent, but sometimes I feel like I have a little ADD, switching from one thing to the next. I think I see more value in getting somewhat proficient in a new skill than trying to squeeze the last ounce of perfection in a current skill such as blogging.

I’ve often wondered about how this translates to my blogging in general. Regular readers know that I usually don’t take time to find an image and put it into article. In fact, and I hate to admit it, but I don’t proofread many of articles. While it’s easy to just say it’s “Lazy being lazy”, it’s really because I’ve got a lot of other things going on. These other “things” often contribute to the very thing that I think get people to read my articles. For example, looking for investment properties is not quick or easy. However, having been there and done it, I can confirm it is a lot of work… but it also can deliver a large amount of “relatively” passive income.

To bring this back to Weird Al, I wonder if he’s continually practicing his music to play better polka. My hunch is that he isn’t. I’m sure he’s continually trying to write better parodies and honing his craft there. I’d love to ask if he’s trying to squeeze the last ounce of comedic genius out of his brain or if he’s learning new skills because that’s of interest to him. My hunch there is that it is the former.

Filed Under: Celebrities Tagged With: Weird Al

Beer Size/Pricing Gone Crazy

March 14, 2014 by Lazy Man 11 Comments

Kosmo from The Soap Boxers passed an interesting link my way yesterday. I already had a post in mind for today, but it is Friday and a post about beer clearly takes precedent. The news that Kosmo sent me was about a Idaho Hockey Fans Suing CenturyLink Arena Over Beer Prices.

I know what you are thinking… it’s about time that someone did something about the price of beer at sporting events! Unfortunately, we aren’t making any headway there. The lawsuit is about the stadium selling a large beer at $7 and a regular beer at $4… which are exactly the same size, just different shape cups. They put together this video demonstrating the rip-off:

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That’s bush-league of CenturyLink to scam people on their beer. Because of the video, CenturyLink has been pressured to make change. Here’s what they are doing according to the story.

“CenturyLink officials announced a short time later that the company would purchase new cups for the large beers that would hold 24 ounces instead of the previous 20 ounces for a bigger difference in size.”

Problem solved, right? Well, not exactly.

Typically buying in bulk nabs you are lower unit price. This won’t be the case at CenturyLink and it won’t even be close. You get the first 20 ounces for $4, but when you pay $3 more you only get another 4 ounces? The small size gives you 5 ounces for your dollar while the large size gives you less than 3.5 ounces for your dollar.

Give me two small beers. I’ll gladly pay the extra buck for 16 more ounces of beer.

[Update: I read another article that clarifies that the small size is 16 ounces giving you 4 ounces for your dollar. The new 24 ounce large size at $7 still won’t give you the same value though.]

I’ve noticed the disparity on the pricing of beer at stadiums before. Usually when the smaller beer is a better value, it is really, really close to the point that is hardly worth mentioning.

Next time you are at a sporting event take a look and do a little math. You might be rewarded with a little extra nectar of the Gods.

Filed Under: News, Spending Tagged With: beer

Are We Financially a “Lost Generation”?

September 18, 2013 by Lazy Man 18 Comments

My friend Glen Craig from Free From Broke shared an interesting article on Facebook last night. With a comment of “wow”, and former Lending Club friend Rob Garcia chiming in with “whoa”, it got my attention. The article The typical American family makes less than it did in 1989 from The Washington Post has nearly 900 comments as I write this.

I read the article and shrugged. I must be missing something.

The article compares inflation-adjusted median household incomes between now and 1989. It even gives showing all the years in between. The author states:

In 1989, the median American household made $51,681 in current dollars (the 2012 number, again, was $51,017). That means that 24 years ago, a middle class American family was making more than the a (sic) middle class family was making one year ago.

This isn’t a lost decade for economic gains for Americans. It is a lost generation.

Why should we expect to make gains on median household income on an inflation-adjusted basis? It’s like getting on a treadmill and being upset that you walked for a half hour and went nowhere. I guess according to the author this is a lost half hour and yet millions and millions of people find value in it every day.

It seems quite an over-reaction to a loss of 1% of income… or about half a percent after taxes.

The Value of Living Today

Glen on Facebook brought up and interesting point, “After reading the article I also wondered what the cost of living is compared to back then. What if we just don’t need as much money for some things as we did back then, like computers?”

My family was one of the earlier families on the block to get a personal computer (The awesome PCjr) back around 1985. Even as we upgraded to 286, 386, and 486 computational behemoths, we never had more than one computer. Today we have numerous laptops, mp3 players, and tablets. The $2000 that my family spent on a computer back then is pretty similar to the $2000 that we spend on various similar technologies today.

We can look back at what my family paid for a landline. I think it was around $40 a month and there were extra charges if you wanted to call long-distance. Today we have Ooma Telo free home phone service, but it piggybacks on a cable bill that has grown from around $20 a month to $125 a month. In addition, many people spend another $100-$110 a month on cell phones and service.

The price of cars have gone up over that time. However, when you adjust for inflation they are pretty much the same (at least through 2006 in that chart). The price hasn’t changed, but you get many more safety features, better gas mileage, increased technology, and comfort.

Lost Generation? Really?

Are we really saving money on computers nowadays? Probably not. Are we really saving money on cars? Nope. However, in both cases our money gets us exponentially more than it did back 1989.

The mere fact that an ordinary person with no journalism degree like me can write to thousands of readers and convey this article is noteworthy.

Does that sound like a “lost generation” to you? Me neither.

Filed Under: Economy Tagged With: inflation, median income, technology

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