I read that when Michael Jackson died, he was $500 million in debt. How does someone get into that kind of debt?
In: Economics
After the 2005 trial, Michael Jackson left Neverland and never went back. He basically lived in fancy hotels for 4 years. That costs money. Especially since he wasn’t alone, but had people with him (security and a nanny, at the very least).
He was about to start his ‘This is it’ tour everything was set up and everything was signed. All those people, venue’s stages etc. still had to be paid for. And no money would come in since the tickets had to be refunded.
This was going to be a show like nothing done before and that costs a really big investment
He had terrible spending habits and would routinely spend 6 or 7 figures on shopping trips. My understanding is that once he died and his family took over his estate, the net worth of the estate went up dramatically because MJ wasn’t spending tons of money.
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>The King of Pop [Michael Jackson](https://m.imdb.com/name/nm0001391/) was known for his unorthodox lifestyle. His lavish spending was allegedly portrayed in the controversial 2003 [ITV](https://m.imdb.com/company/co0229932/) documentary, [Living with Michael Jackson](https://m.imdb.com/title/tt0352524/). One of the clips from the documentary, where [Jackson](https://m.imdb.com/name/nm6320108/) allegedly spent $5 million in just seconds, recently resurfaced on the internet.
Doesn’t answer your question because I’m not rich enough to know the answer however the quote of “if you owe the bank $100 that’s your problem, if you owe the bank $100 Million that’s the banks problem” comes to mind lol.
He would have luxury stores in LA and Vegas shut down so he could shop in them. There’s video of him walking down an aisle and literally pointing to random items saying ‘this, that, this…’ to some of the gaudiest crap imaginable. Like $30,000 sculptures of lions. He bought endless amount of useless items. Plus Neverland and all his staff cost outrageous sums
Did you ever see the interview Martin Bashir did with Jackson where Michael spent a couple of hyndred thousand on worthless bullshit in about an hour?
That’s how he did it and he had the Beatles catalog as collateral for loans from Sony but if he didn’t die he was screwed.
Think about earning potential..
If Michael Jackson could have lived to, let’s say 70-80, he could be living a similar life to other musical stars like Bruce Springsteen, Billy Joel, Celine Dion, etc. they still sell out arenas even in the ends of their careers.
Michael Jackson was able to take out loans with the expectation of earning enough to pay off the debt because he was one of the largest acts in the world. Obviously tragedy struck with his death, and the debt had to be recouped by what was left of his estate and royalty earnings, which probably wasn’t enough though
You end up in debt when you borrow money. You can borrow as much as people (banks) are willing to lend to you. When you’re very famous, people are always willing to lend you money, because they assume that you will be able to pay them back and they want to be associated with you, for PR.
So basically Michael Jackson, with his immense star power, could easily borrow a ton of money because he was also making a ton of money. It took a fair amount of time before banks started to realise that after his peak in the 80s he wasn’t making the insane amounts of money he once did, he also spent a lot of money frivolously, and was often late on payments.
Op take what the people in the other comments to be true, how the rich spend their money is different,
But I think to understand the dept we also have to look into his personal and financial life a bit. Now stick with me I’m not Michael Jackson (MJ) expert.
MJ was a victim of abuse pretty much since he was born all the way up to his death, from family, the paparazzi, there was one Coca Cola commercial where they accidentally burned his hair off, then it became a national sensation that was repeated and mocked by media everywhere.
That does things to people psyche and what they prioritize in their life. When they have opportunities to express their wants they may make … interesting financial choices.
For example [MJ had a private amusement park he owned from 1988 until his death in 2009](https://en.wikipedia.org/wiki/Neverland_Ranch).
There’s also other stuff, scummy music producers, shitty contracts, overcharged venues, lawsuits.
Micheal Jackson had a complicated life to say the least. I hope he’s resting easy.
Edited: for better flow
man that’s wild how someone so famous could be in that much debt. like maybe they spent more than they earned you know what i mean? being rich don’t mean you’re good with money
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