Bible Money Matters

Christian personal finance

Menu
    • About
    • Archives
    • Contact
    • Close
  • Making Money
      • Popular Articles

        • 50 Ways To Make Money: Maximizing, Creating And Increasing Your Income
        • 10 Weird And Unconventional Ways To Make Money
        • Making Money With A Blog (e-Book)
        • 10 Places To Sell Or Trade Your Unused (Or Broken) Electronics
        • Ways To Make Extra Money Series: 20 More Income Generating Ideas From Our Readers
        • Making Side Income Can Help Blunt The Impact Of Becoming A One Income Family
        • Earn Cash Back With Discover it® Credit Card
      • Recent Articles – Making Money

        • Best Sites Like Fiverr To Make Money As A Freelancer
        • 13 Of The Best Independent Contractor Jobs
        • 25 Of The Best Gig Economy Jobs
        • How To Make Money Blogging: Turn A Blog Into A Business
      • Categories

        • Making Money
        • Investing
        • Retirement
        • Jobs & Work LIfe
        • Money
        • Income
    • Close
  • Saving Money
      • Popular Articles

        • 50 Easy Ways To Save Money Every Month
        • 10 Weird And Unconventional Ways To Save Money
        • 10 Practical Ways To Save Money And Increase Your Net Worth
        • How To Save Money On Just About All Of Your Regular Monthly Bills
        • Ways To Watch TV Without Paying An Arm And A Leg For Cable TV
        • Save Money On Your Hospital Bill - Just By Asking
      • Recent Articles – Saving Money

        • How To Save $100k In 7 Practical Steps
        • Stairs App Review: Save And Invest To Earn 4-6% Interest
        • Honey Review: Save Money Automatically When You Shop Online
        • 9 Convincing Reasons Why You Need An Emergency Fund
      • Categories

        • Saving Money
        • Frugality
        • Planning
        • Finance
        • Saving For Retirement
        • Savings Accounts
    • Close
  • Banking
      • Best Rates For 2019

        • Best Credit Cards
        • Best Savings Accounts
        • Best Mortgage Rates
        • Best CD Rates
        • Best Brokerages
        • Free Credit Scores
      • Recent Reviews

        • TradeStation Review: Commission Free Stock And ETF Trades
        • Firstrade Review: Commission Free Trades on Stocks, Crypto, And Options
        • Cadre Real Estate Investing Review: Commercial Real Estate Investing
        • Axos Self Directed Trading Review: Invest, Trade Stocks For Free
      • Categories

        • Bank & Software Reviews
        • Investing
        • Credit
        • Banking
        • Mortgage
        • Insurance
        • Family Budget
    • Close
  • Recommended
  • Video
    • Close

Spending Less Than You Earn. Sound Advice At Any Income

By Peter Anderson 7 Comments - The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited December 3, 2013.

Share2
Pin
Tweet
Share
2 Shares

The past week was a sad one as we saw the passing of several well known celebrities.

The week started off with the passing of affable Johnny Carson sidekick and veteran of two wars, Ed McMahon. He was always able to light up the stage with his easy going demeanor, and he seemed to be a genuinely nice guy.

The week went on and we also saw the deaths of Farrah Fawcett and Michael Jackson. Farrah and Michael both died too young, with Farrah passing after a hard battle with cancer, and Michael passing after having a heart attack (source unknown?).  How many of us have memories of Michael Jackson’s music from our younger years?

Two of these celebrities have something in common, more than just their celebrity status. Both Michael Jackson and Ed McMahon had been in financial trouble within the past few years. Seems they both had problems understanding one key financial concept that remains constant whether you’re making $20,000 a year or 20 million.   If you want to succeed, you can’t spend more than you make.

Ed McMahon And Foreclosure

Ed McMahon has been in show business for decades.  We all remember him from the Tonight Show with Johnny Carson,  Star Search and all of those Publisher’s Clearing House ads.  Over the years Ed McMahon had earned a fortune through his various endeavors.  By all accounts his financial situation should have been quite secure.  The problem was, Ed wasn’t the greatest with the finances.   One rep described his money problems:

His rep, Howard Bragman, further felt McMahon’s money mess was a result of a confluence of “bad health, bad economy, bad housing market.”

When you look a bit deeper, however, you’ll see that McMahon wasn’t very disciplined in his spending. According to a variety of sources he was generous to a fault, always being overly generous to everyone around him. One friend who helped write two books with McMahon said,

“Being Ed McMahon was an expensive proposition,” he said. A lot of cash “went to tips,” noted Fisher, who recalled walking through hotel lobbies with McMahon as he would hand out money to anyone who helped him.

He also lost a large amount of money helping his 3rd wife to launch a failed clothing line.  Add to that several expensive failed marriages, and within the past year Ed McMahon found himself in over 1.5 million dollars worth of debt.  What did he owe on?

He owed approximately $644,000 in payments on a nearly $5 million mortgage loan.  He also owed American Express almost $750,000 in unpaid bills, along with having an outstanding loan of $135,000 to yet a 3rd company.

Ed McMahon had been facing foreclosure on his home within the past year and had been scrambling to scrape up the money to cover his expenses, even doing a commercial along with MC Hammer for a company called “Cash4Gold” in his last year.

If only Ed had learned earlier the importance of having a solid financial plan, and of spending less than you earn, he might have left a larger financial legacy.

Michael Jackson And His Millions In Debt

Michael Jackson is an even more severe case of someone who didn’t live out the concept of living within a budget.  Despite the fact that he had made hundreds of millions of dollars over his career, Michael died with a mountain of debt, by some estimates at the time of his death he was in debt by over 400 million dollars.  Before he died he was planning on coming out of retirement  in the coming months to help pay for some of those debts, and to struggle to get his life back on track.

During his career Michael sold over 61 million albums, owned rights to the Beatles catalog, and even had  a popular ride at Disney World.  He had made hundreds of millions of dollars, and because of it he was able to live a lavish lifestyle. Even so, he lived a bit too lavishly.   During one of his very public trials, the details of Michael’s finances came out in the public eye.

One forensic accountant testified that the singer had an “ongoing cash crisis” and was spending $20 million to $30 million more per year than he earned.

Jackson was known to go on lavish shopping sprees, spending millions of dollars on antiques, toys and other things.    There are stories of him flipping through high end catalogs and ordering every item on every page.  Or other stories of him spending $150,000 in a few minutes at London’s Harrods store, or $250,000 on antiques in Beverly Hills.  And of course there was the millions he spent on plastic surgery.

At some point Michael took out a 200 million dollar loan against this Beatles catalog rights, in order to continue to finance his lifestyle.

What legacy does he leave for his 3 children?  A mountain of debt, and the possible hopes of being able to dig out of the debt in order to have something left over?

What Do Their Stories Tell Us

What can we learn from Ed McMahon and Michael Jackson’s stories of financial woe?  What could they have done differently?

Personally I think their stories point out how even the most basic of personal finance advice can be excellent advice – at any income.  The advice?  Make sure to spend less than you earn, and save and invest the rest.

Make sure that you have a solid financial plan, and at the very least that you have someone around you helping you to make good decisions about your money.  It sounds to me as if neither of these men had anyone there to help keep them accountable, and that they both just enjoyed spending money on the things they wanted, or the people that surrounded them.  In the end even though their incomes were as large as some small countries, they spent more than they had made.  It lead them to financial ruin.

The last point that this illustrates to me is the futility of trying to spend your way to happiness.  Money has never yet made someone happy. Sure, it can buy you momentary fun, and fleeting happiness, but in the end you can only find true happiness and inner peace through a relationship with Jesus Christ.

Jesus said again, “I tell you the truth, I am the gate for the sheep. All who ever came before me were thieves and robbers, but the sheep did not listen to them. I am the gate; whoever enters through me will be saved.He will come in and go out, and find pasture. The thief comes only to steal and kill and destroy; I have come that they may have life, and have it to the full. John 10:7-10

Related Posts

  • Spending And Your Friends: What Happens When You Have Differences In Income?

    It can be difficult to enjoy times with your friends when there is an income disparity -- even if you are the one with more…

  • 5 Ways To Pay Less In Taxes By Reducing Your Taxable Income

    What are some changes that you can make that can reduce your taxable income and save money on your tax bill?

  • How To Deal with Out of Control Spending

    “Where does all my money go?”  “Why isn’t there any money left at the end of the month?”  “I can’t pay all my bills every…

Share2
Pin
Tweet
Share
2 Shares
Last Edited: 3rd December 2013 The content of biblemoneymatters.com is for general information purposes only and does not constitute professional advice. Visitors to biblemoneymatters.com should not act upon the content or information without first seeking appropriate professional advice. In accordance with the latest FTC guidelines, we declare that we have a financial relationship with every company mentioned on this site.

This article is about: Budget, Commentary, finance

About Peter Anderson

Peter Anderson is a Christian, husband to his beautiful wife Maria, and father to his 2 children. He loves reading and writing about personal finance, and also enjoys a good board game every now and again. You can find out more about him on the about page. Don't forget to say hi on Pinterest, Twitter or Facebook!

Comments

    Share Your Thoughts: Cancel reply

  1. Miranda says

    I think this offers pretty sound evidence that it doesn’t matter how much money you have. It’s what you do with it.

    Reply
  2. MoneyEnergy says

    You’re right, it’s definitely sad. And unbelievable too – but I guess when you grow up already having that money, you don’t know it’s “true value” – what it usually takes to earn it. You might think the money always flows that easily – and for MJ, it really did. Bank of America gave him a $140 million dollar loan no questions asked even when he was in debt. It’s horrible to think he’d set that off against his Beatles’ rights. It’s an awful use of what is still effectively the wealth of average people everywhere, just funneled through one source.

    MoneyEnergys last blog post..Are You Doing Your Life’s Work, or Are You An Employee of The Market?

    Reply
  3. Matt Jabs says

    Wow, just goes to show… the concepts remain the same: no matter how much dough you make, you can only make so many cookies.

    I think something worth noting is the pressure of an anti-frugality lifestyle that comes w/being a celebrity. Many of us will never know their plight, but I’m willing to bet that “keeping up with the Jone’s” is all the more tempting when you are in the celebrity spotlight.

    Regardless, as Pete so eloquently states… “you have to spend less than you earn” & “It is futile to try & spend your way to happiness”.

    Great lessons.

    Matt Jabss last blog post..Follow Through on Financial Goals

    Reply
  4. Jason Y says

    Excellent points, Matt. My wife and I have really struggled to fight the temptation to keep up with the Joneses, and more generally, with cultural “norms” and expectations. Sane financial decisions make me feel like everyone else thinks I’m insane, but that’s no reason for me to jump off along with so many others.

    Reply
  5. Paul @ FiscalGeek says

    I’ve fully been a victim of trying to maintain a standard of living based on my neighbors and peers. It’s a hard battle, but when you can finally say, you know what I can drive a 15 year old car no problem because I can have a future.

    On a very lighter note: SNL has an awesome commercial: Don’t Buy Stuff you cannot afford. Funny but it’s a little too close to home.

    Paul @ FiscalGeeks last blog post..When DIY has No ROI: Diary of a DIYaholic

    Reply
  6. MLR says

    I heard a person on the radio the other day saying MJ didn’t die in debt because of how much our society owed him. RIGHTTTT.

    It’s sad, these celebrities could have set all of their future generations up for life. Instead, they pissed it all away.

    MLRs last blog post..Carnival of Top PF Posts #9

    Reply
  7. Roxanne says

    Love the last point and agree totally that no matter how much you make the principle is the same!

    Roxannes last blog post..Food Grade Diatomaceous Earth

    Reply
Previous Post: Personal Finance Bible Verse Of The Day: God Loves A Cheerful Giver
Next Post: Going Back In Time: This Month Last Year on Bible Money Matters
Discover Investment Platforms

Popular Posts

  • 21 Easy Ways To Earn Free Amazon Gift Cards
  • 10 Best Free Tax Filing Services And Software Online
  • 21 Apps That Pay You Real Money Fast
  • 17 TV Apps And Live TV Streaming Services To Watch TV Free
  • 30 Legit Online Jobs That Pay Well
  • 37 Easy Ways To Get Free Gift Cards
  • How To Get Free Stock
  • 40 Easy Ways To Get Free Money Fast
  • 21 Places To Read Free Books Online
  • 24 Legit Online Jobs
  • 17 Best Work From Home Jobs: A List Of Legit Online Jobs That Pay Well

Recent Posts

  • How To Save $100k In 7 Practical Steps
  • How to Save Money When Remodeling A Home
  • How To Hire A Contractor For Your Remodeling Project
  • Remembering 9/11 Years Later: Where Were You On That Fateful Day?
  • TradeStation Review: Commission Free Stock And ETF Trades
  • Firstrade Review: Commission Free Trades on Stocks, Crypto, And Options
  • Cadre Real Estate Investing Review: Commercial Real Estate Investing
  • Best Sites Like Fiverr To Make Money As A Freelancer
  • Axos Self Directed Trading Review: Invest, Trade Stocks For Free
  • 30 Quotes About Easter And Resurrection: He Is Risen!

Disclaimer

The information contained in BibleMoneyMatters.com is for general information or entertainment purposes only and does not constitute professional financial advice. Please contact an independent financial professional for advice regarding your specific situation.

In accordance with FTC guidelines, we state that we have a financial relationship with some of the companies mentioned in this website. This may include receiving access to free products and services for product and service reviews and giveaways.

Any references to third party products, rates, or websites are subject to change without notice. We do our best to maintain current information, but due to the rapidly changing environment, some information may have changed since it was published. Please do the appropriate research before participating in any third party offers.

Amazon and the Amazon logo are trademarks of Amazon.com, Inc. or its affiliates.

We respect your privacy: Privacy Policy.

Thanks for visiting!

Bible Money Matters - Seen On These Sites and more..
Bible Money Matters is a personal finance, entrepreneurship and investing community. Give more, save more and live more.

Copyright © 2023 · Bible Money Matters | Sitemap | Advertise | Privacy Policy