What Celebrities Can Teach Us About Money

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Posted on 08/03/2009

They have bathtubs made out of 24K gold. They never wear a pair of underwear a second time. In one night they rack up bar tabs that would pay off the average American’s mortgage. Celebrities aren’t always known for their money smarts. But sometimes the best lessons are learned from other people’s mistakes. Here’s what celebrities can teach us about money.

Sometimes Less is More - MC Hammer is known for his rap songs, those unflattering pants and his 1996 bankruptcy. But the multi-platinum selling entertainer is back. He doesn’t quite have the mega-mansion he once had, but he’s got his family. Take a cue from Hammer; as long as you have what’s really important, the rest of the stuff is just stuff.

Make Sure You Have a Will - If we could learn anything from Michael Jackson’s sudden death it’s that having a clear and updated will is extremely important. Don’t leave your loved ones with questions and confusion. Make sure your estate will be handled properly and according to your wishes.

Comebacks Can Happen - Donald Trump lost his fortune in the early 1990’s only to earn it back. He’s filed for bankruptcy several times but always manages to be on top of his game. Even if you lose it all, just remember that you can stage a Trump-style comeback.

Everyone Must Pay Taxes - Nobody likes paying taxes, but everyone has to do it. Even if you’re Nicolas Cage. The IRS accused Cage of writing off personal expenses under his business, a big no-no. Cage learned this lesson the hard way, but you don’t have to. Confused about what you can write off? Talk to a tax professional to make sure it’s all legal.

Don’t Be Afraid to Ask for Help - Shortly before his death in June of 2009, Ed McMahon faced a foreclosure of his Hollywood mansion. Thankfully friends stepped in to help, including host Jay Leno and real estate mogul Donald Trump. If you’re going through rough financial times, don’t be afraid to tell those close to you. They may not be able to bail you out, but they’ll be able to offer support.

Save as Much as You Can - It’s always amazing when you hear of internationally-known celebrities who have squandered their money and are left with nothing. Although it’s hard to imagine blowing through hundreds of thousands of dollars a month without saving any of it, celebrities do it all the time. Make sure you’re saving as much as possible so that no matter what happens in the future, you’ll be prepared.

By Alison Storm

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