13 Lessons From Entertainers And Moguls Who Went From Millions To Broke
Being entertainers and moguls doesn’t guarantee lives of consistent wealth. Many celebrities earn millions for their managers but stay broke or go broke for a variety of reasons.
Here are 13 entertainers and moguls who went from have to have not.
T-Pain: Keep spending under control
When hip-hop artist and producer T-Pain came on the scene, he made auto tune trendy. Born Faheem Rasheed Najm, the Grammy-winning artist was earning $millions in the early 2000s. He went on to found the record label imprint Nappy Boy Entertainment in 2005. From 2006 to 2010, T-Pain was said to be worth $40 million. Then he lost it all. He was so broke that at one point he said he had to ask for money to buy his children a burger.
“I’ve been mega-rich, you know, I’ve been super broke right in the middle of thinking I was mega-rich, and then got rich again. And you know I learned how to really give a s— about money,” the artist said in a 2019 interview with The Breakfast Club.
“So now I know what the high end is and what the low end is,” T-Pain, 34, said.
Bad deals, lawsuits, and bad financial management brought down his wealth. According to T-Pain, he “almost” lost his $6-million house in Atlanta, and his spending habits had his accountant “panicking.”
“Once you give a s— about the money you’re making, then, you know what I’m saying, you feel much better about your accomplishments. You feel much better about what you’re doing. You start paying attention to your work that makes you money,” he said. “You get back up and you learn, man.”
T-Pain and his wife, Amber Najm, have three children — Lyriq, 15, Muziq, 12, and Kaydnz, 9.
Now, T-Pain is back on track. “Being able to afford diapers and food — that was a great moment,” he told People.
“I think that’s always going to be my proudest moment — figuring out how to provide for my family,” he added. “Awards are always great, but in the long run, it doesn’t really say who you are. I’m more concerned about my family, my kids, and my wife and making sure I can provide.”
Johnny Depp: Mind your money
After countless films, Johnny Depp was considered one of Hollywood’s powerhouse actors. His movies pulled in big bucks — and so did Depp. But after a scandalous divorce and a hugely bad deal with two former business managers, Depp found himself in a deep financial hole.
In 2016, Depp learned he had lost the $650 million he made at the height of his “Pirates of the Caribbean” fame and was left owing $100 million in taxes on account of business managers whom he accused of robbing him blind, The Mirror reported.
Depp claims that his former business managers, Joel and Robert Mandel of TMG, committed fraud in their dealings with him. They are countersuing, claiming Depp’s spending — buying private islands, a French château, a156-foot yacht and more — is why he went broke.
Depp’s attorneys filed a scathing lawsuit against TMG, seeking $25 million in damages for negligence, fraud, unjust enrichment and breach of fiduciary duty, among other things, Vanity Fair reported. TMG responded with a countersuit, blaming Depp’s “selfish, reckless, and irresponsible lifestyle” for his misfortune. The firm’s lawsuit claimed Depp spent $2 million a month, including a $300,000 a month for salaries for his 42 full-time employees. Also, Depp’s 15-month marriage to the actress Amber Heard cost him $7 million following their 2016 divorce.
Lisa ‘Left Eye’ Lopes: Keep your emotions in check
The late Lisa “Left Eye” Lopes of TLC fame helped make records that sold millions for the record label and management company and raked in money but not for her or the other two singers in TLC. The financial downfall of TLC is well known after the 1999 VH-1 episode of “Behind The Music” and 2013 TV film “CrazySexyCool: The TLC Story”.
Lopes at one point had to borrow money to pay for her bankruptcy lawyer. It wasn’t just bad business deals that broke her — it was also her personal life.
After a fight when her boyfriend, football player Andre Rison, Lopes allegedly tried to burn a pair of his sneakers but his whole house went up in flames. Lopes was fined $10,000 and got probation for arson. While her relationship with Rison continued, his insurance company, Lloyd’s of London sued Lopes. The company sued her for $1.3 million and forced her (and indirectly, the rest of TLC) into bankruptcy. Rison loaned Lopes and her bandmates $15,000 each so they could hire bankruptcy lawyers, The Grunge reported.
TLC: Be careful of contracts you sign
“I will never forget the day we were millionaires for five minutes,” TLC’s Tionne “T-Boz” Watkins told the Guardian in 2017. She was recalling TLC’s heyday, when she and bandmates Rozonda “Chilli” Thomas and Lisa “Left Eye” Lopes were making hit after hit and millions after millions — mainly for the record company and their manager. They were broke due to a bad record deal the trio had signed.
The Atlanta-based group “owned the ’90s,” the Guardian reported. “Their brand of sultry R&B, silky enough to woo the masses but glitchy enough to keep them interesting, has made them the most successful U.S. girl group of all time. Their two biggest albums, ‘CrazySexyCool’ (1994) and ‘Fanmail’ (1999), sold more than 20 million copies between them, with other singles and albums helping to rack up a total sales haul of around 65 million worldwide.
But the 20-somethings were almost broke very little money in their bank accounts.
“I will never forget the day we were millionaires for literally five minutes,” said Watkins. “Because the check was written to us and we had to sign it over, back to (Pebbles, their former manager).”
Thomas added, “If I could go back, I would definitely change a couple of things business-wise. I have learned the hard way: sign your own checks, make sure your taxes are in shape and whatever your company is, it’s always good to get it audited. If you don’t have anything to hide, it’s not a worry.”
The group filed for bankruptcy in 1995, then was hit by the tragic death of Lopes, at age 30, in 2002, who died in a car accident while on holiday in Honduras.
T-Boz: Have an emergency fund
After TLC member Lisa Lopes filed for bankruptcy, other members were broke and had to file for bankruptcies in 1995 as well. For bandmate Tionne “T-Boz” Watkins, it turned out to be one in a series of Chapter 13s. In 2011, she filed for bankruptcy twice that year alone — the second time after defaulting on mortgages on her $1.2 million Atlanta home and failing to keep up with her medical bills and car payments, Billboard reported.
Her monthly expenses totaled $8,821, including two mortgages, two vehicles, medical bills, and more. She also is owed $250,000 in child support payments.
The entire group had been suffering financially. Even though they were a top-selling music group, they made very little money.
“People to this day still do not believe that we were broke — but we were, OK?” Watkins said during a1999 episode of VH1-s “Behind The Music.”
“The group made $5.6 million in profit, but the sum was cut down to a mere $50,000 per member after paying back their label for funding the album and its promotion; managers, lawyers and accountants; and income taxes,” Billboard reported.
Larry King: Your actions can affect you financially
Famed TV host Larry King is a financial comeback king. The 86-year-old is reportedly worth $150 million now but back in the 1960s he was living the high life and spending as he raked it in. Then it seems he got greedy and went broke.
In 1971 King was arrested and charged with grand larceny for stealing $5,000 from a business partner. The charges were eventually dropped but the scandal cost him his radio jobs. He declared bankruptcy in 1978 with debts of an estimated $30,000, The Telegraph reported. The same year, King landed a late-night talk show slot on the radio that later developed into his own successful TV show “Larry King Live” which ran for 25 years.
Nicolas Cage: Fantasy spending is a no-no
Actor Nicolas Cage seems to love to spend money but it landed him in financial hot water a number of times.
Cage once blew his $150 million fortune and went broke. A former top earner in Hollywood, he used his earnings on expensive and often eccentric purchases, eventually facing foreclosure on several properties and owing the IRS $6.3 million in property taxes in 2015, CNBC reported.
By 2018 Cage had regained some of his wealth and was worth around $25 million. He is taking roles to help pay off his debts, according to CNBC’s “The Filthy Rich Guide.”
Here’s how blew through $150 million: he once owned 15 residences, including a $25-million waterfront home in Newport Beach, California, a $15.7-million countryside estate in Newport, Rhode Island, an $8.5-million home in Las Vegas and the infamous LaLaurie mansion, worth $3.4 million, in New Orleans. He also owned two castles in Europe, one for $10 million, the other for $2.3 million. Among his other purchases were a 70-million-year-old dinosaur skull, pygmy heads, a $450,000 Lamborghini once owned by the late shah of Iran, a pet octopus worth $150,000 and the first Superman comic for which he paid $150,000, CNBC reported.
Toni Braxton: Read the fine print
When singer Toni Braxton revealed she was broke, many were surprised. After all, in the 1990s at her peak, she generated more than $170 million in album sales. In an interview on ABC’s “20/20,” she said that she only took home a mere $1,972. Under her recording contract, after taking advances from her record company she remained in debt to them.
“What happens is they will give you an advance million on the next record and the next record so you kind of stay in debt in a sense,” said Braxton about her record label. This led to her first bankruptcy in 1998.
Even though she was making a small amount, she was spending major money on “an obsessive home decor habit,” Essence reported.
“I love dishes and house things so I kind of lost it a little bit on the houseware. One-thousand-thread-count sheets — that’s what I indulged in,” admitted Braxton.
By 2010, Braxton had filed a second bankruptcy when she was forced to cancel her self-financed “Toni Braxton: Revealed” Las Vegas show due to unexpected medical issues. Braxton was diagnosed with lupus.
Damon Dash: Friends may not make the best business partners
Damon Dash has been known as hip-hop’s dealmaker. Through his deal-making, he and his partners of 15 years — Jay-Z and Kareem “Biggs” Burke — were able to turn Roc-A-Fella Records into a top music label and then Rocawear into a major player in urban fashion. But that all changed when Jay-Z decided to sell Rocawear to Iconix for $200 million in a deal that Dash now claims shortchanged him and caught him off guard.
Dash says he was left broke. He owes money all around town, from lost lawsuits to child support (for which he got arrested in 2019) to failed business ideas such as social media site Blocksavvy.
“We have fundamental differences. I’m about making other people famous and rich and equal, that’s what I wanted with Roc-A-Fella. And he wanted to be the boss and have people work for him for 25 years straight, which is what happened. I actually feel sorry for my fallen angels, because I’ve taught people to share…I make kings, I don’t make slaves,” Dash said in a 2019 interview on a popular syndicated LA radio show with Big Boy on 92.3.
“I don’t wanna talk about Jay-Z. You know why it’s not fair? ‘Cause he doesn’t talk about it,” Dash said in a Rolling Out report. “No matter what, I feel he robbed me. Period. And no matter what, I’m always gonna feel that way. If I hit somebody with some work and they run off, I forgive it. It don’t bother me, but if you asked me about that person, I’m like, ‘Nah, he ran off.’”
Dash told TMZ in 2019, “My income streams have all been garnished…and it is very difficult to address the mounting bills until I receive some relief from the courts.” He also said he made just over $56,000 that year — a lot less that the hundreds of thousands he was used to raking in.
Gary Coleman: The buck stops with you
The late Gary Coleman, who rose to fame on the popular ’80s TV show “Diff’rent Strokes,” was at one point the highest-paid actor on TV, but in 1999 he declared bankruptcy.
“After a series of costly medical troubles and even costlier legal battles with his adoptive parents, the then 31-year-old claimed a $72,000 debt and filed for Chapter 7 bankruptcy,” Time Magazine reported. Just a decade earlier, the actor reportedly had a $7-million fortune. His downfall could be blamed, he said, “from me to accountants to my adoptive parents, to agents to lawyers and back to me again.”
Lil Kim: Debts can snowball
Hip-hop’s Queen Bee, Lil Kim, got stung financially despite rapping about her “Benjamins” during her prime in the late 1990s. Lil Kim filed for Chapter 13 bankruptcy in 2018 and has racked up more than $4 million in debt, The New York Daily News reported.
The platinum-selling hip-hop artist had a net worth of $18 million in 2017 and filed for Chapter 13 just three days before a bank foreclosed on her $3.1-million mansion.
Michael Jackson: Live within your means
Probably the most famous entertainer to face financial ruin is Michael Jackson. At the time of his death in 2009, the pop star was “tapped out” and millions of dollars in debt.
“Despite receiving millions of dollars annually from his song catalogs, Michael Jackson year after year spent more than he earned, including $30 million in annual debt payments,” The Los Angeles Times reported.
According to forensic accountant William R. Ackerman, who testified as a defense witness on behalf of AEG Live in a wrongful-death trial brought by the Jackson family, Jackson spent money on donations to charity, gifts, travel, art, and furniture.
Then there was Jackson’s famed property, Neverland Ranch, which is sort of a mini-theme park. The estate was a “huge drain” on Jackson’s income.
Listen to GHOGH with Jamarlin Martin | Episode 73: Jamarlin Martin Jamarlin makes the case for why this is a multi-factor rebellion vs. just protests about George Floyd. He discusses the Democratic Party’s sneaky relationship with the police in cities and states under Dem control, and why Joe Biden is a cop and the Steve Jobs of mass incarceration.
As early as 1993, Jackson owed $30 million, which grew to $140 million by 1998. From 2001 through June 2009, Jackson’s debt grew by about $170 million. When he died, Jackson owed $400 million to $500 million, Ackerman testified.
“He was tapped out,” Ackerman added.
Kim Basinger: Think through your plans
Actress Kim Basinger, known for her roles in “Batman” (1989) and “LA Confidential” (1997) was living so high that she once purchased a 1,691-acre town she ultimately had to sell when she filed for bankruptcy.
In 1989, Basinger paid $20 million for the town of Braselton, Georgia. Basinger wanted to create a tourist attraction such as a theme park or movie studio, Business Insider reported. But by 1993 she had declared bankruptcy and had to sell the town.
She was also facing a lawsuit from “Boxing Helena” producer Carl Mazzocone for backing out of an oral contract to star in the film. Basinger was ordered by the Los Angeles Superior Court to pay damages and legal fees. The actress decided to settle in 1995 and avoided the court’s initial $8.1 million judgment.