Key Takeaways
- The new name, image, and likeness (NIL) guidelines allow college athletes to make money from sponsorships, social media, and brand deals.
- A revenue-sharing lawsuit allows schools to share a percentage of their athletic revenue with players.
- With money playing a larger role in school sports, athletes will face more pressure.
Many people know how well certain professional athletes are paid. But it may come as a surprise to know that now, college athletes are also earning income. Due to the name, image, and likeness (NIL) rules and a revenue-sharing settlement, college athletes are bringing home paychecks. This is changing the world of college sports.
Name, Image, and Likeness Profitability
On July 1, 2021, the NCAA enacted a policy that allows college athletes to profit from their name, image, and likeness (NIL). NIL is an athlete’s personal brand for which they can be paid by third parties. This policy came about from the Supreme Court’s decision in NCAA v. Alston, which stated that the NCAA cannot restrict athletes from profiting from their name, image, or likeness.
Now, according to NCAA policy, athletes can endorse products, sign sponsorship deals, engage in commercial opportunities, monetize their social media presence, and take advantage of other sources of revenue generation.
To remain compliant with the policy and be eligible to continue playing sports, players must track expenses, maintain earning records, and file taxes as they would on other income.
While the NIL ruling allows athletes to profit nationwide, state laws play a role in how athletes can earn income, too. Some states restrict profiting from gambling and alcohol deals. Others are less strict. As a result of this patchwork legislation, state NIL laws have become an important factor in how families and athletes decide what school to attend.
Revenue Sharing for Athletes
The settlement of the House v. NCAA lawsuit in June 2025 resulted in another big change in college sports. The court determined that Division I schools can share up to 22% of profits with athletes, determined as the average of media rights, ticket sales, and sponsorships earned by a Power Five School. The cap is $20.5 million in 2025, which will increase by approximately 4% every year.
This greatly impacts school athletic budgets, requiring changes to contracts and reorganization of finances to ensure revenue-sharing can be met. The changes have also led to the creation of an oversight body, the College Sports Commission, which will be responsible for compliance.
Actual Impact
The NIL and revenue-sharing opportunities are already reshaping how college sports are conducted, viewed, organized internally, and how players make school decisions.
For example, NiJaree Canady, a softball pitcher for Texas Tech, joined the school after signing a $1 million NIL deal in 2024 with Texas Tech’s NIL collective, the Matador Club. In 2025, she signed another $1 million-plus deal to remain with Texas Tech.
“Nija Canady is the most electrifying player in softball. She’s box office and she goes out every day and competes,” her manager, Derrick Shelby of Prestige Management, told ESPN. “The decision to stay at Tech was not difficult. This program has taken care of her. They have showed how much she is appreciated. The entire staff, her teammates, the school in general have been great.”
As a portion of schools’ earnings will now go to athletes, colleges are looking for ways to bring in additional revenue streams. This puts a massive strain on school budgets, and especially on smaller schools’ athletic programs.
Schools are already being savvy and turning to other sources of revenue like stadium concerts or facility rentals. For example, Coldplay performed at Stanford University.
How Athletes Can Navigate the NIL Landscape
Here are a few tips for how student athletes can navigate NIL opportunities:
- Stay on top of taxes: Track all of your income and expenses, create business structures that benefit you, and maintain a budget.
- Build your brand early: You’re selling a version of yourself, so focus on your strengths, such as athletic skills, academics, your online presence, and social work.
- Understand your school’s legal jurisdiction: Know the NIL rules in your state. These will shape the deals you make. Work with your NIL compliance office.
- Use collectives carefully: A NIL collective is an independent entity that isn’t run by the school. Ensure there’s transparency, fairness, and compliance with Title IX.
- Rely on school resources: Check the types of resources your school has to guide you through this process, including counseling, workshops, and deal support.
Note
NCAA athletes are now hiring sports agents and financial advisors to help sign deals and plan their finances.
Future Trends and Financial Implications
NIL and revenue-sharing mean certain students have become semi-professional athletes. That status can involve wealth, fame, and the pressure that comes with being in the spotlight. Significant financial investments in student athletes can lead to a lot of stress and mental health challenges for young adults.
Additionally, as the big sports schools expand to attract top-tier athletes, smaller institutions and Olympic sports will need to reposition themselves to remain competitive.
The Bottom Line
College athletes now perform under a new set of rules that allow them to make money, sign deals, and build their brands, all before graduating. With NIL and revenue-sharing, they have stepped into semi-professional roles that offer financial opportunities and fame, and all of the pressure that comes with it.
While big-name sports schools are well-positioned to attract top talent, smaller schools might struggle to keep up. This could have an array of impacts on attendance levels and budgeting. As this new period evolves, students, schools, and lawmakers will have to adapt.
