Wednesday, July 23, 2008

What Happened to that Boy??

When you're riding around in a Bugatti, you got Kim Kardashian in the passenger seat, and your house cost nearly $11 million, it seems like life couldn't get any better; unfortunately for Scott Storch, it didn't. Just a few years after all the guys were banging "Lean Back" and all the girls were listening to "Baby Boy," the producer is apparently in serious financial trouble. He had a warrant out for failure to pay child support and failing to show up in court last month. He also owes half a million in 2006 and 2007 real estate taxes and is currently trying to refinance his waterfront mansion. All of this comes after he put his $20 million yacht up on eBay for a starting bid of $600,000.

This is a perfect case of what NOT to do when you come up financially. You do one of two things with money at all times: spend it or stack (save and invest) it. Too many young people are not taught to do the latter. We were raised in a purchase-on-sight era, and that mentality causes us to live in excess of our means. Storch represents so many people who get a few dollars and spend it faster than they earned it.

For everybody trying to get involved in professional sports, entertainment, or any occupation that offers you more money than you're used to, learn how to manage your income. You can lose millions of dollars just as fast as you can lose a couple of hundred; maybe even faster. According to Storch's lawyer, the child support case has been settled, and he still owns his house, but that isn't a relief. The bigger picture is that someone with millions would have rather bought luxury cars and yachts before he made sure his kids were good and he had some money in his account. Before you go out and spend your bread on something, consider whether you've handled your financial obligations first. Even the richest man can lose his wealth and assets...all he has to do is throw it away.

Mike posted a blog a few months ago about cutting back expenses and saving money. Take a look at it here.


No comments:

Post a Comment