Just because someone hits it big in the music industry doesn’t mean they’re set for life. Plenty of the biggest names in music have struggled with overspending, bad investments and poor money management that left them in serious debt. Although people are often quick to judge a celebrity, they’re humans like everyone else, and they’re just as prone to making the same mistakes as regular people.
Usually, their mistakes are amplified and carry a bigger weight than an average person’s. While you might struggle with several thousand dollars in debt, famous musicians can face debts that are in the multi-millions. Here are five popular musicians who found themselves in debt and how they eventually took steps to recover.
The King of Pop actually died with $400 million in owed money. Although he spent his entire life selling chart-topping albums, Michael had serious financial matters to look after. The most expensive was his famous Neverland Ranch, which he bought in 1988 for close to $15 million. In the early 2000s, with his reputation severely tarnished in the wake of pedophilia scandals, he used half of his shares in ATV music as collateral to take out more than $200 million in loans. He also began borrowing money from lenders like Union Finance & Investment Corp., who sued the musician in 2002 for $12 million in unpaid dues. Jackson continued to spend extensively, usually spending $20 million or more than he earned annually.
Eventually, Jackson fell into a pattern of selling off high-value assets, borrowing more money and winding up further in debt. He was bailed out by friends on several occasions, and things began to look up when the singer announced he would be touring for the first time since 1997 in 2010. Unfortunately, that never came to fruition as Jackson passed away in March of that year with a net worth of $500 million. By 2012, the managers of his estate had nearly paid off all his personal debts, and the remaining finances were distributed as he wished, namely to his mother and children.
What can we learn from Jackson’s experiences? The biggest takeaway is to focus on income first. While external funding and financial assistance are beneficial at times, the most valuable asset anyone has is their personal income. Regardless of how much someone makes, a budget will always be useful as it provides structure and serves as a buffer to prevent overspending.
West is one of today’s most prolific rappers with a $3.2 billion net worth, but he grew up as the son of a single-mother teacher in Chicago after his parents’ divorce when he was age 3. From an early age, he was interested in the arts and music. After graduating high school, he attended the American Academy of Art in Chicago on a scholarship, dropped out of his program when he was 20 to pursue a career in rap. His debut album was named “The College Dropout”.
Although West received immense praise and success, fans were surprised to learn that he was over $53 million in debt in 2016. The announcement came after West declared he wanted Mark Zuckerberg to invest $1 billion in his ideas. West’s fashion line, Yeezy, found the greatest success when it partnered with Nike to produce the Air Yeezy sneaker. That endeavor alone, however, left the rapper with $16 million in startup costs unpaid. His extravagant lifestyle, which includes buying designer clothes for his children and a $14 million ranch in Wyoming, also contributed to the $53 million balance.
West eventually paid off what he owed after his wildly successful collaborations with Nike and Adidas. The Yeezy sneaker lines at both brands brought him $150 million in pre-tax income. The average person might not be able to suddenly happen upon such a successful business venture, but they can work hard and slowly star to transform their income into investments. The rapper used loans to finance much of his initial branding launch, and while they might not be suited for everyone, personal loans can be a useful tool in money management and repayment. If you want to get credit card debt or other finances under control, you can explore your loan options online now for free. The super-simple process takes less than 60 seconds, so you’ll have potential choices at your disposal almost immediately.
In the early 2000s, 50 Cent was one of the most popular rappers on the scene, but in July 2015, the musician was filing for bankruptcy to get rid of more than $23 million. Prior to this, 50 was one of the richest rappers in the business with a net worth of over $150 million. That figure has now dropped to $30 million as of 2019, but he’s begun to recover from a series of bad personal decisions and investments that took him from rich to bankrupt in just a few years.
50 Cent grew up as Curtis James Jackson III in Jamaica, Queens, New York. His mother was a drug dealer, though she passed away in a fire when Jackson was 8. From that point, he was brought up by his grandmother. Although he once aspired to be a professional boxer, he fell into drug dealing at age 12. At 19, he was sentenced to three to nine years in prison but was able to negotiate a deal where he attended a juvenile boot camp and obtained his GED.
After he rose to fame in hip-hop, he hit a series of events that dropped his $155 million net worth to less than $30 million. He’s invested in multiple real estate ventures, stocks and products, but not all of them have turned out in his favor. A week before filing for bankruptcy, he was ordered to pay $7 million to an ex-girlfriend of whom he released pornographic material online without her consent. He was also ordered to pay $17 million to Sleek Audio after he failed to produce his own line of headphones.
In addition to poor investments, 50 Cent lived an extravagant life that included an 18-bedroom mega-mansion in Connecticut and a collection of luxury cars, including the $1.3 million Ferrari f150. Although it isn’t for everyone, filing for bankruptcy can be a beneficial way for people to protect their home and other assets when facing significant debt. When balances have exceeded one’s ability to pay, bankruptcy is sometimes the right solution that gives people the clean slate they need to start making better financial choices.
In Hollywood, pop singer Kesha’s $5 million net worth might seem modest, but she has still done relatively well considering the financial and emotional hardships she has endured. Born in Los Angeles and raised in Nashville, Kesha was a lifelong music lover who rose to viral fame with the hit single “Tik Tok”. Her debut album went double-platinum and sold over 1 million copies worldwide.
After numerous collaborations with some of the time’s most popular acts, Kesha eventually receded into a quieter career that was, unfortunately, plagued by professional, legal and psychological hardship. The biggest financial struggle comes from her on-going lawsuit with producer Dr. Luke, who Kesha sued for a string of physical, emotional and sexual abuse that almost lost her life. She says that Dr. Luke put her in a position that forced her to choose between following her dream of making music or being outed from the entire industry.
The extravagant legal costs, as well as her personal expenses with limited income, resulted in singer-songwriter Taylor Swift giving Kesha $250,000 to cover legal fees. Although she’s still tied in a legal battle, Kesha pooled her leftover funds to produce her third album, “Rainbow”, which was No. 1 on the Billboard 200 upon its debut. Although Dr. Luke still collects money from her earnings, the singer is an admirable testament to the importance of perseverance in the face of personal hardship that impacts every aspect of your life.
Fans of 80s rock will recognize Snider as one of the most famous musicians of his time. Twisted Sister was a heavy metal band that, although now obscure, used to rule the rock scene back in the day. Although he still holds a net worth of over $10 million, Snider faced serious financial hardship in the 90s on the tail end of his success in the decade prior.
The heavy metal headbanger was raised in a quiet Long Island suburb and enjoyed singing in his church’s choir before he joined Twisted Sister in 1976 at age 21. Although they enjoyed voracious fanfare in the hurricane of heavy metal culture during the 80s, Twisted Sister was never received with such enthusiasm again. The massive decline in record sales resulted in a serious income decline that left Snider in the negative. Despite the obvious downward spiral his finances were taking, Snider said that he just kept spending, and that by 1995, he was flat broke.
Snider revealed that his recovery was slow but steady. He began working a minimum wage job, shopped at thrift stores and cut coupons to save money. At the end of the decade, he found some moderate success after penning a Christmas track for legendary vocalist Céline Dion; he later wrote several screenplays that were shown on Broadway. Today, he’s living comfortably with his wife of over 30 years, Suzette. His financial woes are a common story, and his modest but honest recovery exemplifies how both honesty and hard work can help anyone rebuild after years of poor decisions and money mismanagement.