When it comes to money, celebrities are just like the rest of us-they spend too much, save too little, and make a number of poor financial decisions. There are many celebrities that you would think would be financially well-off that are struggling. Some of them are better at saving, while others are spend-happy. Although their incomes may be large, their expensive lifestyles will oftentimes deplete their bank accounts quicker than than they can earn more.
Below are just a few of the list of celebrities who lost their fortunes to poor financial planning:
Nicolas Cage was one of Hollywood’s highest-paid actors in 2009, earning $40 million that year. Cage’s extravagant spending habits though led him to financial problem. He was hit with a $6.2 million tax lien in 2009.
Kanye West revealed through his twitter account this past February that he was $53 million in debt.
Charlie Sheen has gone from a staple of prime-time television to just one of many celebrities with major debt. Despite his reported $150 million net worth, the actor is allegedly $12 million in debt.
Lindsay Lohan’s finances had declined so much by 2012 that Charlie Sheen allegedly gave her $100,000 so she could pay off the taxes she owed from 2009 and 2010. The child actress and Mean Girls star is reportedly worth $500,000 these days—a drastic decrease from her previous net worth.
MC Hammer. “U Can’t Touch This,” earned MC Hammer over $33 million in 1991 alone. Unfortunately, his lifestyle of buying luxury cars, airplanes, keeping up his expensive entourage, and spending $30 million to build a 12-acre home has been reported to have put MC into $13.7 million debt.
Toni Braxton has filed for bankruptcy twice now! Once listing her debts as high as $50 million to companies including Tiffany and the Four Seasons.
NFL and NBA Players. It’s not just singers and actors but athletes have major financial struggles as well. For example it’s estimated that 80% of NFL players are either bankrupt or under financial stress with just THREE years of retirement. It’s estimated that 60% of NBA players go bankrupt with FIVE years of retirement.
Thanks to these celebrities, everyday folk can learn a bit about the do’s and don’t’s of handling money.
- Spend within your means
- Don’t forget to file your taxes
- Don’t try to outsmart the IRS
- Be careful about who does your finances
- Save for a rainyday
Not sure how to manage your finances better than these celebrities? There is always the option to take a financial education class like Good Money Habits™ or Good Money Habits for Students™ to help guide you along the way of establish good money habits now and for a lifetime!