Bankruptcy is something we have all heard about. Maybe we even know someone who has had to go down that road.
For some, their finances have gotten so bad that they wonder if bankruptcy is the only option left. As you consider that option, there is probably shame and fear and a huge weight on you that you have allowed it to get ‘this bad.’
You are right: bankruptcy is a last resort option and should only be taken with the determination that it is never going to happen again. You have to commit to change, no debt and even counseling, if you really want it to get fixed. It took a lot of work to get into bankruptcy and will take a lot to get out of it.
But the shame has to stop. The guilt isn’t going to help you starting over, it will just keep you in the same mindset that got you trapped in the first place.
Did you know that there are a lot of famous people who have declared bankruptcy at one point or another?
Let’s take a look at some celebrities who had to start over:
Kim Basinger - Oscar winner and ex-wife of Alec Baldwin, Kim Basinger was forced into bankruptcy after a breach of contract lawsuit. She declared $8 million in her bankruptcy filing and was able to settle 4 years later and continue on with her acting career.
Elton John - International singer and five time Grammy winner, Sir Elton John has seen continual success since his debut album “Goodbye Yellow Brick Road” in the year 1973. However, a lavish lifestyle of spending an average of $1.2 million a month eventually caused him to declare bankruptcy and sue his manager in an attempt to clear his name.
David Cassidy - Teen idol star and former actor on The Partridge Family during the 1970s, David Cassidy continued in fame as singer for 30+ years. However, in 2015, he filed for bankruptcy following health problems, a nasty divorce and several DUIs. He claimed over $10 million in debts when he filed his bankruptcy.
Larry King - Best known for his journalism and his nightly news broadcast, Larry King Live, Larry King was accused of grand larceny and while the charges were eventually dropped, the result was that he found himself in over $300,000 in debt and unable to pay it back, he went ahead and filed for bankruptcy.
Walt Disney - Creator of the Walt Disney entertainment empire, Walt Disney had to file bankruptcy for his first film company, Laugh-O-Gram, when he was defrauded by his distributors. It is not known what his debts were with this first company, but it is known that Disney was unable to pay the rent or his own employees. As a result, he had to file for bankruptcy himself in 1920. Fortunately he was able to launch Walt Disney Studios almost a decade later in 1928 after taking out a loan from his brother and parents. Once Mickey Mouse was created, the company took off to become one of the most successful film studios of all time.
Stan Lee - Creator and founder of Marvel Comics, Stan Lee, found himself in legal battles concerning the Marvel comics and his company Stan Lee Comics. This resulted in bankruptcy for the Stan Lee Company, although there is no report for the official amount that the bankruptcy was declared for.
Teresa Giudice - TV actress Teresa Giudice is best known for her role in The Real Housewives Of New Jersey. In 2009, she filed for bankruptcy. However, due to hiding of assets prior to the bankruptcy filing, she served time in prison. She just recently got out and began repaying the bankruptcy debts.
Henry Ford - The inventor of the automobile did not always enjoy fame and money for his inventions. In 1899, Henry Ford began the Detroit Automobile Company, but he was so focused on creating a perfect vehicle that he did not bring in any serious income (the factory only produced a mere twenty vehicles), forcing a bankruptcy filing for the company. Fortunately, Ford rebounded by forming the Ford Motor Company in 1903, which has become one of the most successful vehicle manufacturers in the world.
Joe Francis - Joe Francis is the director behind the show and company Girls Gone Wild, a program that filmed drunk girls on spring break. His company filed for bankruptcy in 2013, and he later went $2 million in debt from casino debts. When he refused to pay, a warrant was issued for his arrest, but he has been hiding in Mexico ever since.
Meatloaf - Famous musician Meatloaf is best known for his 1977 album “Bat Out Of Hell,” which has sold over 44 million copies and still continues to be one of the top selling albums of all times. However, he quickly became involved in numerous lawsuits adding up to over $80 million.that was being requested from the lawsuits. In 1983, Meatloaf declared bankruptcy totaling $1.6 million.
Milton Hershey - Milton Hershey started his own coffee shop in 1876 in Philadelphia after apprenticing for four years in another shop to learn the art of making candy. Unfortunately, the shop went bankrupt in six years. Fortunately, Hershey didn’t give up, and rebounded with the Lancaster Caramel Company that he sold for a million dollars in 1900. He then focused on perfecting his now famous milk chocolate formula, which resulted in the company known as the Hershey Foods Corporation.
Cyndi Lauper - Famous musician Cyndi Lauper declared bankruptcy before she was even able to get her singing career started. In 1981, she and former bandmates were sued by their former manager, which forced her to declare bankruptcy. Due to having to repair the debts, she stepped away from singing for a few years and worked in retail. She was able to bounce back 4 years later when she released her hit “Girls Just Want To Have Fun,” and she can currently boast of a net worth of around $30 million.
Donald Trump - Although the current President of the United States never personally declared bankruptcy, his business did declare bankruptcy four times. From 1991-2009, Trump’s casinos and hotels declared bankruptcy over and over, eventually causing Mr. Trump to step down and reduce his share in the company, so that they could get the businesses back on track again. President Trump is not the only President to file bankruptcies, as others on this list include Abraham Lincoln, Thomas Jefferson, Ulysses Grant and William Grant. Speaking of Abraham Lincoln…
Abraham Lincoln - The 16th President of the United States may have been an excellent orator, statesman, and leader, but the same could not necessarily be said for his financial skills. In the early 1830s, Lincoln purchased a general store and then proceeded to buy out the inventories of other stores on credit. But when his general store failed to produce the profit he needed, Lincoln was forced to sell his shares, and he ended up over a thousand dollars in debt (equal to roughly $30,000 today). Lincoln was forced to continue paying off his debts for over a decade, and without modern bankruptcy laws at the same time, he lost nearly all of his assets in court as well
Dave Ramsey - Now famous as a national talk show host and leading expert in finances, Dave Ramsey and his wife had to file bankruptcy at the beginning of their marriage to get their debt under control. In the 25+ years since, Dave has built a net-worth of $55 million by essentially teaching everyday people how to avoid the same mistakes he made.
50 Cent - In 2015, 50 Cent was named one of The Top 5 Wealthiest Hip-Hop Singers, and was valued at over $150 million. Within the year, he filed for Chapter 11 bankruptcy when he was “estimating” his debt to be between $10 million and $50 million. Fortunately, 50 Cent was later able to reorganize his finances and pay back his liabilities.
Willie Nelson - Famous country music singer and song writer Willie Nelson was forced to file bankruptcy after the IRS audited his taxes and found that he owed millions in back taxes. The reason why Nelson ended up owing the back taxes is because the IRS disallowed several deductions that he had claimed in his tax forms, and they seized the vast majority of his assets in order to pay back some of what he owed. In one of the most creative methods of repaying bankruptcy and taxes, Willie Nelson released an album titled “The IRS Tapes: Who’ll Buy My Memories?” As a result, he was able to pay off $16 million in 3 years.
Mark Twain - 1800’s American author Mark Twain (Samuel Clemons) had to file for bankruptcy after attempting to self-publish, while investing in several businesses. It is said he owed approximately $80,000 (equivalent to $2.4 million in today’s economy), but was quickly able to bounce back after authoring and publishing wildly successful books that are still popular and widely read today.
Toni Braxton - 5-time Grammy winner, Toni Braxton has sold over 20 million albums and is still enjoying a very successful career. She filed for bankruptcy in 1998 with $2.8 million in debt. She was forced to sell 2 of her Grammys as part of her repayment plan. One year later, she was back on track with a new record deal of $25 million.
Burt Reynolds - Famous movie star Burt Reynolds found himself in debt over $10 million dollars. When his movies were not paying it off fast enough, Reynolds declared bankruptcy to pay off his debts. In an unusual move, the courts allowed him to keep his lavish homes and only made him pay back $2.5 million of the debt.
These twenty celebrities are just a few of the examples of people who have had to go through bankruptcy court. The range of debt is extreme to much more extreme.
While bankruptcy is never something we want to consider, if you are at the point of needing it, get your debts and financial papers in order, talk to a financial adviser and a bankruptcy lawyer. It is not the end of the world, it is your step forward to getting back on track.
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