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5 Ways to Manage Your Money the Way Celebrities Don’t

by Minority Fortune

Recently we’ve seen an influx in individuals experiencing financial problems. There’s been more celebrities affected than what we’d care to report. They should know better than anyone else how to manage their money, but it’s usually not the case. This phenomenon just goes to show that they are regular people. Before the money and the fame, they were people with limited financial knowledge just like everyone else. Upon amassing a larger income, they carried that mindset with them. After tossing their money around left and right, they will return to humble beginnings. Ah, nevermind the plight of celebrities. Let’s focus on you and how you can manage your money much better than they ever will.

Boosie and Money

Take a look at this picture. Financially stupidity is a disease. Don’t let it affect you. If you or someone you know is suffering from this disease, please seek help immediately. Better yet, read this post.

5 Ways to Keep Your Wealth

  1. RIP GMLook Ahead: The CEO of an oil company expects oil prices to fluctuate continuously based on a variety of factors. They probably understand better than anyone that something can be “here today and gone tomorrow”. The same thing can apply to our jobs/careers. It’s an unfortunate reality, but it’s been documented over and over again in this economy that when times are tough, jobs are scaled. American auto workers and tech support jobs are obsolete now as they’ve been outsourced. Even CEOs now typically switch jobs every 7-8 years. Even if you manage to keep your job for your entire working career, you’ll eventually retire. Whatever income you earn must take you through your retirement. Learn the turnover rate in your company for your position. Analyze the time you’d like to stay in your position against the company average. Stay on top of trends in your industry and company.
  2. Spread Your Earnings: If you’re getting a steady paycheck now contingent upon your working for it, then you’re not guaranteed the same paycheck for tomorrow. You may be facing an injury, maternity leave, family emergency, natural emergency, sabbatical, etc. (We certainly hope for haiti-earthquakethe best, but these situations must be considered.) Are you spending your paycheck as if you’ll always receive that amount? If so, it’s time to correct this habit. Cut spending. Start with 10%, and distribute that savings towards an emergency, retirement, and/or investment fund. Continuously save money for the day that your steady paycheck isn’t so steady. Be aggressive. You’ll be glad you did.
  3. Generate Passive Income: Once again, if you have to work for all your incoming money, you need to begin looking at ways to earn passive income. Proper investments such as real estate, stocks, and bonds are the classic option, but there are other options too. Non-conventional options include royalties, outsourced businesses, and business equity. Find something that will work for you.
  4. Alter Your Mindset: Power does not come in your spending. It comes with your saving. If you earn a million a year, and you spend $1.5 million a year, your net worth makes you broker than the homeless. It’s all about your assets outweighing your liabilities. MC Hammer was once worth an estimated $20 million dollars through the 80s-mid90s. However, he spent it all and went bankrupt shortly after. So, does his old income mean much today since he spent it all? Not a chance. Many celebrities are spending their way into future poverty because they believe every dollar spent yields them power. They’ll learn the hard way how much power they have when they’re completely broke.
  5. antoinewalker2Take Care of Yourself & Realize That You Aren’t a Bank: Family and friends are great. Really, they are. There may come a day when a family member hits a rough spot and comes pleading for help. However, a line must be drawn, and everyone must ultimately take some responsibilities. Asians are usually more than happy to help their own financially by giving their family members low interest loans if needed. That means they expect their money returned, with interest. Antoine Walker blew through his nine-digit wealth partially due to his enabling all of his family and friends. If you loan any money out, make sure you have a contract outlining the details and expectations. Loaning or giving money should empower someone and not cripple them. Banks deny people loans in an instant if the right circumstances aren’t met. In order for you to keep your wealth no matter how big or small, you must do the same.
*Images courtesy of Nightside, Georgetown Voice, and CNN.
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