Unfortunately, financial problems can be a great equalizer.
Regardless of the salary or status, mismanagement of funds can lead to a world of trouble. Although it’s hard to believe, this also applies to our favorite celebrities and public figures who reportedly earn millions of dollars throughout their career. For example, although a high-paying NFL contract seems to be the ticket to eternal riches, that’s not always the case. Roughly 16% of retired football players end up bankrupt within 12 years of stepping off the field for the last time, according to a study by the National Bureau of Economic Research. To that end, for other highly visible public figures living in a litigious culture, lawsuits, other legal woes, and ill-advised financial investments can lead to major financial issues.
Fortunately, there’s a way out. With smart planning and consistency, we’ve seen some of our most successful celebs earn their way back to the top. Here are a few superstars that found their way back from the brink.
01
Steve Harvey
In an
interview, the comedian and businessman shared that in 2008, he owed the IRS $22 million in 2008.
“My accountant died, and an accountant that worked for him called my lawyer and said, ‘We have a problem. She had found on the floor all my tax forms for 7 years, signed with the checks stapled to them.”
He said there were nefarious things happening with his accounting team and that’s essentially what landed him in hot water.
“They were cashing the checks, keeping the money, and not turning in the tax forms….They didn’t cash it, they took the money out [of] the account that matched the exact number.”
Taking the hit seriously, he said he worked out a payment plan over the years, and is now IRS debt-free. The consummate showman is now worth upwards of $200 million dollars per
Black Enterprise.
02
Rihanna
It’s hard to believe that everyone’s favorite billionaire was once hovering over filing bankruptcy, but it’s true.
Afrotech reported that In 2007, around the time Rihanna released the hit “Umbrella,” she had a net worth close to $50 million. But in 2009, she was strapped for liquid cash. Reportedly, Rihanna started the year with $11 million in cash and ended the year with $2 million. Due to poor advice from an ex-accountant, her net worth was dramatically impacted. Rihanna later sued the accountant for mismanaging funds, keeping an unfair amount of profits, and not properly filing taxes. She won the lawsuit with a $10 million settlement, and the rest, as we know, is history.
03
Mike Tyson
The beloved heavyweight champion was once the top-earning boxer during his heyday, but decades later he
declared bankruptcy, returned to jail, and went through rehab.
In 2003, it was reported
he owed money to the IRS, British tax authorities, lawyers, a personal trainer, a financial manager, a music producer, and others. Tyson also was on the hook for paying a $9 million divorce settlement and back child support.
Presently, it seems like he’s back on top. Through careful planning and smart investments, the retired fighter
launched a marijuana company in 2018, runs a successful podcast that appears to be monetized, and has plans to start a cannabis-themed resort.
04
Kanye West
Not one for frugality, Kanye West has built a career wrapped in luxury. But this mindset is partially what may have landed him financial trouble a few years ago.
Despite the musician and businessman
reportedly making $1 million per night while on tour in recent years, he took to Twitter in 2016 to announce his $53 million debt. Just three years later, he not only paid the debt back but claimed he was on his way to billionaire status.
This is mostly due to his apparel brand Yeezy, which is a billion-dollar empire,
He also negotiated an unprecedented 15% royalty on the wholesale price of his sneakers with the German shoemaker Adidas, plus a marketing fee, after he brought his brand over to the apparel brand from Nike in 2013, according to Forbes.
