Lance Armstrong is a world-renowned professional cyclist whose reputation has come under siege due to accusations of using performance-enhancing drugs. On Aug. 23, 2012, Armstrong was cited for multiple anti-doping rule violations and received a lifetime ban from professional cycling.
Armstrong's penalties have wide-reaching repercussions on a professional and financial level. Here is a look at the effects of Armstrong's alleged illicit activities and how recent events have affected the cyclist financially.
Long-Term Financial Effects
From 1999 to recent tours, Lance Armstrong was a highly-respected member of the cycling community, having secured a record seven Tour de France titles. He also overcome cancer, and made significant strides in helping other cancer patients with his Livestrong foundation. Now, as the cyclist comes to terms with the end of his career, losing the awards, and bad press, he may also have to come to grips with a lower salary.
Armstrong's reported net worth is a hefty $125 million, with awards from competitive tours making up much of that total. In order for Armstrong's net worth to increase, he will need to focus hard on keeping his sponsors and focus on his work with Livestrong. Since the Tour de France grants winners roughly 450,000 euros per win, Armstrong could potentially have to pay back at least $4 million.
Loss of Sponsors?
A question that many are asking is whether or not Lance Armstrong will maintain the support of his sponsors. Thus far, Armstrong hasn't lost any endorsements, but it's hard to guage how many new sponsors he'll lose out on. Two of his major sponsors include Michelob Ultra and Nike. Anheuser-Busch and Nike have both released statements indicating that their faith has not wavered in the cyclist. This is excellent news for Armstrong, as the support of sponsors can mean all the difference in how the Livestrong foundation thrives in the future.
On the day the news came out that Lance Armstrong was banned from pro-cycling and the severity of his penalties were revealed, something unexpected happened. Rather than see a drop in support for Armstrong's foundation that strives to support cancer patients, the organization actually saw an increase in donations. The day the news was first reported that Armstrong was banned from cycling, Livestrong donations increased a staggering 25%.
Maintaining a Positive Outlook
Despite the odds stacked against him, Armstrong remains positive. He has promised to "turn the page" and commit himself to his Livestrong foundation to help cancer patients. Additionally, Armstrong plans to focus on his family.
The Bottom Line
Armstrong may face some stiff penalties in the future should the USADA deem that the cyclist must pay back all of his winnings from his seven Tour de France wins. Armstrong is, however, off to a positive start in his post-cycling career by maintaining his corporate sponsors and continuing to uphold and enhance his charity. Without future income from competitive racing, Armstrong will need to find a way to supplement his cash flow.
A natural and easy way for Armstrong to maintain his current lifestyle and keep up his cash flow is to continue to grow and improve his Livestrong foundation, maintain positive relations with his sponsors, and be open to public speaking or possibly book deals explaining his side of the story. Armstrong could easily maintain his current lifestyle, if he plans ahead carefully. While only time will tell if he faces steep monetary fines or not, Armstrong will certainly have to come to grips with living life without the competitive winnings he has grown accustomed to achieving over the past 13 years.