Correction: An earlier version of this article incorrectly stated that Nicolas Cage filed for bankruptcy in 2009. Mr. Cage has never declared bankruptcy. We regret the error.
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When Michael Jackson blew through $6 million during one shopping trip in Las Vegas, an outing that turned into the biggest takeaway from a 2003 British TV documentary that painted the pop star as the consummate weirdo, it became the go-to example of why Jackson was said to be $400 million in debt when he died.
Let's see, $6 million x 365 days in a year...plus all that Neverland Ranch upkeep...
But even if he didn't have seven-figure expenses every single day, the real question was, what happened to all the money Jackson made over the course of his four-decade career? 1984's Thriller was the second best-selling album of all time when he died (it's since become No. 1). His 1991 recording contract with Sony alone was for $65 million, not including touring and the endless monetizable aspects that go hand-in-hand with the sort of game-changing music Jackson was producing at the height of his career. He spent "only" $47.5 million in 1985 on ATV Music, which included the Lennon-McCartney portfolio. Sony then bought half the rights to the ATV catalog in a 1995 merger for $95 million.
So even if he was spending like a maniac, which he apparently was ($8 million in annual travel and antiquity acquisitions alone as the 20th century became the 21st), how did Jackson end up close to half a billion dollars in the red?
The answer is utterly average.
Unpaid loans. The financial system that frequently gobbles up people much, much lower on the earning totem pole than Jackson also got to him. Wanting to maintain a certain lifestyle, he secured a $200 million loan in 2001 and continued to spend tens of millions more each year than he was making for the rest of his life. (Tens of millions also went to settle various civil claims brought against him for alleged child molestation. He was acquitted of criminal charges in 2005.)
For anyone who's ever been in the slightest bit of credit card debt knows, it's alarmingly easy to spend beyond one's means. Even if—or maybe especially if—your means are seemingly infinite.
Ironically, after his sudden death in 2009, money started pouring back into his estate (the sale of his half of the Sony/ATV catalog for $750 million helped secure a cushion for his kids' future) and Jackson's is one of the most posthumously flush afterlives around.
But while Jackson's financial troubles proved a shocking and tragic cautionary tale at the time, he's in storied company when it comes to poor money management among the celebrity set. Considering how prevalent money issues are among regular people, just add some zeroes and you've got Hollywood Economics 101: Amex Is Going to Want You to Pay That Bill One Day.
Not that far removed from articles slavering over his exotic global lifestyle—a whole village in France! his own private island! a yacht!—Johnny Depp has become the new poster boy for frivolous over-spending.
Lately dubbed Hollywood's most overpaid actor (overall box office returns compared with his usual eight-figure asking price for big-budget features), the $650 million his accountant claims he earned over 13 years is apparently all gone.
First, let us remember that the lofty numbers so high they make our ears pop that are reported as a celebrity's estimated net worth are what a person is rumored to have made over a period of time. The vaunted Forbes lists of earnings don't then factor in how much money is constantly flowing out of an actor or athlete's bank account—nor do they claim to, but it's just a reminder that at the end of one year, Dwayne Johnson didn't hang onto the entire $64.5 million. Taxes alone eat up a healthy chunk of dough. (Which, of course, is also why so many celebs seem to run afoul of the IRS.)
Now, savvy money management—including properly diversified investments—can make for an estimable bottom line at the end of the day, so it's not as if these sums are so outrageously beyond the limits of possibility.
It's easy to assume that people in the public eye—who are expected to look perfectly coiffed and arrive in style at all times—have more money than they actually do. (If it makes you feel any better, a lot of those cars are leased, and a lot of the sexy accessories are free.)
Tori Spelling, for instance, has been sued several times over the past year for tens of thousands in unpaid credit card bills. People ask, but isn't she heiress to the Spelling television fortune? Sure, she and Dean McDermott, whose TV jobs (such as his hosting gig on Chopped Canada) seemed to coincidentally dry up after his misbehaving ways were probed on True Tori, have five kids, but...the family's famed Beverly Hills estate, "The Manor," estate sold for $85 million in 2011 and mom Candy Spelling moved into a $35 million condo.
An all cash deal, as they say in very few zip codes.
But Tori only inherited $800,000 when her father, Aaron Spelling, passed away in 2006 and she's had a rocky relationship with her mother.
"It's no mystery why I have money problems," the Beverly Hills 90210 star wrote in her 2013 memoir Spelling IT Like It Is. "I grew up rich beyond anyone's wildest dreams. I never knew anything else. Even when I try to embrace a simpler lifestyle, I can't seem to let go of my expensive tastes. Even when my tastes aren't fancy, they're still costly. I moved houses to simplify my life, but lost almost a million dollars along the way."
Tori's mother confirmed that she would spend money like it was going out of style.
"She would close a store and drop $50,000 to $60,000," Candy told The New York Times in 2014. "I never did anything like that. She just went crazy."
On a 2014 episode of True Tori, after an eviction notice errantly taped to the door of their rental house again put their money troubles in the spotlight, Tori lamented to Dean, "I'm overwhelmed with life. Sorry. I just feel responsible."
She added, "I feel so responsible for so many people and I can't do it...the responsibility of having to take care of so many people financially, the fear of that. [It] doesn't matter. I know people look at me and they're like, 'Oh, poor you.' Like, 'Boohoo, you have so many problems.'"
"We live paycheck to paycheck!" she cried. "After this [show] I have no f--king idea if work's going to come in. Like, how am I going to support my family in six months? Look at the life we're leading. We're paying for five f--king private schools."
But she flatly declared she didn't want their lifestyle to change. And so it didn't.
In January 2016, Candy told TMZ she was paying her daughter's rent and providing for her grandchildren—but she was not involved in helping Tori and Dean pay off their debt. That February the family moved into a $7,500-per-month rental home in Encino, Calif., which, compared to the five figures and up that a mansion can rent for in L.A., is a comparative bargain.
But back to Depp, who of course has made gobs of money over the years, some through his eight-figure asking price but even more through lucrative back-end deals that entitled him to a percentage of a movie's ticket and merchandising sales, plus future royalties. Even if his cut was, say, just 2 percent of the global box office for Alice in Wonderland, that's $20 million.
However, among his extraordinary expenses over the years, per court documents: $5.35 million to buy his three-island atoll in the Bahamas; $3.6 million a year for his 40-person staff; $18 million on a yacht and $350,000 a month to maintain it; $30,000 a month on wine; $3 million to arrange for Hunter S. Thompson's ashes to be shot out of a cannon.
Yeah, we haven't come across a Groupon for that last one yet.
But this is where the savvy money managers are supposed to come in, to prevent the Jacksonesque spending, and hopefully to protect a person from the worst of the worst—i.e. getting utterly screwed by a Ponzi scheme, as Kevin Bacon and Kyra Sedgwick and thousands of other people (including a number of celebrities) were when they invested with Bernie Madoff, who made almost $65 billion worth of investments disappear.
"It's fine," Bacon told Howard Stern in 2011, several years after Madoff's house of cards collapsed. "So you have a moment where you go, 'Holy s--t, that was many, many years of work just went away in a poof of smoke.' And then you go, 'Hang on, we're okay. We're looking at each other, we got a nice apartment, our kids are healthy. There's other people who had it a lot worse. We can both work.'"
According to a $25 million lawsuit filed by Depp against The Management Group in January, he lost millions due to TMG's "gross mismanagement"—including their failure to pay his taxes on time, resulting in $8.3 million in penalties and fees—"and, at times, outright fraud."
"Like many successful artists who depend on financial professionals to advise them, Mr. Depp trusted and reasonably relied on TMG to handle his financial and certain legal affairs and to ensure that he and his family would have a financially secure future, built upon the foundation of the substantial moneys Mr. Depp earned through years of hard work," his suit alleges. The actor claims he only found out the direness of his situation when he changed firms.
To be so rich you have literally no idea how much money you're spending or if your taxes are getting paid...could you imagine? But thanks to stories like this, it's starting to sound nightmarish.
The Management Group has counter-sued for fraud, declaring the actor's allegations to be false. "Depp is responsible for his own financial waste," the company argued in court documents.
Meanwhile, another quirky actor comes to mind.
Tales of Nicolas Cage's spending became the stuff of largess legend in 2009, when a legal battle with his financial advisor revealed that not much was left of the $150 million he made as one of the biggest stars in Hollywood in the '90s through the mid-00s.
But he too blamed the people tasked with handling his money for his financial downfall.
Similar to Depp's claim, Cage alleged in court documents that his financial advisor paid himself millions of dollars in fees and neglectfully left the actor's finances in ruins.
Then again, Cage amassed 15 homes, four yachts, 22 cars, an island in the Bahamas and a Gulfstream jet. (And, of course, a Tyrannosaurus bataar skull bought at auction for $276,000 that years later he had to give up when it was determined to be stolen.)
Cage insisted he was left in the dark about his true state of affairs while his taxes went unpaid and his bills piled up; his former advisor, Samuel J. Levin, insisted otherwise, claiming he did everything short of confiscate the Face/Off star's credit cards to keep him in the black. They reached an undisclosed settlement in 2010.
Cage—who coincidentally, like fellow big spender Michael Jackson, was briefly married to Lisa Marie Presley—has made two dozen films since his financial wipeout in 2009, also adding to his thirsty coffers in 2011 when he sold a mint-condition copy of the first comic book to ever feature Superman for $2.1 million.
"Why didn't they drop me as a client if I was so out of control?" Depp, who now has more riding on the May 26 opening of Pirates of the Caribbean: Dead Men Tell No Tales than he could have bargained for a year ago, said in an interview with the Wall Street Journal last month. "I've worked very, very hard for a lot of years and trusted a lot of people, some who've clearly let me down."
Not that the actor was entirely oblivious when it came to money. He's said before that he didn't love the tax rate in France, where he lived part time with his now ex-partner Vanessa Paradis and their children, Lily-Rose and Jack.
"They wanted me to become a permanent resident," Depp told The Guardian in 2011. "Permanent residency status—which changes everything. They just want [he mimed handing out bills] dough. Money." Moreover, if he were to become a dual citizen of the U.S. and France and have to pay taxes in both countries, "you essentially work for free."
But the counterclaim filed against him alleges that his lawyer and business manager sat him down in 2012 and told him he couldn't maintain his $2 million a month lifestyle (which included providing for his kids) and the Pirates of the Caribbean star agreed to make some adjustments—such as sell his yacht, the Vajoliroja.
The 156-foot boat reportedly belongs to J.K. Rowling now.
Another rude awakening came after Depp settled his divorce from Amber Heard, who had initially asked for $50,000 a month in spousal support, for $7 million (plus god knows how much in legal expenses and incidentals) and, not long before that, Alice Through the Looking Glass tanked at the box office.
More money will be coming in: His shooting schedule for the near future is packed, and he surprised moviegoers the world over (some pleasantly so, and others not so much) by turning up in Fantastic Beasts and Where to Find Them, an indicator he's joining the franchise. But Forbes also predicted, when they noted his $48 million earned between June 2015 and June 2016, that his earnings would "likely plummet" in 2017.
So it seems as though the belt tightening will continue. The next time Johnny Depp steps out looking as if he's wearing every piece of clothing he owns, here's hoping that's not actually the case.