What are the biggest fortunes people have squandered

Factual Questions
41

There’s a fascinating documentary from ESPN:

Basically, you take young people who have never had to deal with a lot of money, and dump them in an environment where they have more money than they can comprehend. They are surrounded by the types who know how to sponge off them; as one fellow in the documentary says, “my friends knew when payday was and they were waiting outside when I cam out with my cheque.” They don’t plan ahead. they don’t realize that “buy mama a house” or “buy each of your buddies a car” means you will be paying for those things every month for years - even if the gravy train ends. They want to go clubbing with their friends, but they have to pay for their buddies, and have upped the ante from local bars to the most expensive night clubs. Sad.
Ever watch that first documentary with Michael Jackson, the one that got him into trouble? They’re walking through those expensive bric-a-brac shops in Vegas, and he’s like a kid in a candy shop. Bronze gilded elephant sculpture, 2 feet tall? “I’ll take that!” One piece of junk after another. He had nothing as a kid, so he buys like one of those TV Hoarders. He bought and built a zoo and an amusement park. He was surrounded by helpers (the “Mormon Mafia”) that were paid by him so too afraid to tell him “no”. Eventually he hocked his entire catalog (and the Beatles’) to stay afloat. He died, stopped spending, and apparently his kids are worth quite a bit.

42

But, done intelligently, this is not going to bankrupt you if you are a successful athlete.

Mike Tyson used to give Porsches to prostitutes (in his bio he mentions how he now drives a Cadillac Escalade, and in his mind that car isn’t good enough to give to a hooker, let alone drive). Yeah, that was a dumb move.

But if you buy a home for your family member in a reasonable cost of living area, its not going to cost more than 200k or so at the most. As for your friends who need cars, you can buy them gently used cars for 10k or so. You can buy homes and cars for several loved ones as long as they live somewhere reasonable. An athlete who made 40 million won’t go broke if they are smart about it and buy modest homes and reasonable cars for family members in reasonable areas.

As for Michael Jackson, from what I’ve heard in 2009 he was 400 million in debt. His estate is now worth 2 billion. Supposedly him not blowing everything means the money is accumulating.

FWIW the combined money Michael Jackson, Holyfield, Mike Tyson, and endless other athletes managed to blow is still less than Paul Allen lost trying to invest in telecommunications companies. Which makes me laugh a bit. Take all the money Mike Tyson managed to blow in 15 years and it would’ve taken him centuries to blow as much as Paul Allen lost in bad business decisions.

43

This depends on your definition of “successful.” The average NFL player’s career is just 3.3 years. Annual salaries for players cover a very wide range, so it’s sensible to speak of players’ median annual salary, which is $860,000. Income taxes will eat up about 40% of that. So after 3.3 years (assuming you’re an average player), you get cut from the NFL with $1.7M to your name, minus whatever you’ve been spending during that period. And you’ve probably been spending pretty wildly in a “keeping up with the Jones” contest against the star players on your team who are earning millions per year. So now you’re 26 years old and unemployed, with a 2.0 GPA and a rusty basketweaving degree, and maybe (if you weren’t too wild) $750,000 in the bank, and very limited fiscal sensibilities. It’s not a recipe for the good life.

44

Gene Tunney did. Of course he fought back in the 20s when taxes were low. He earned a lot for his second fight with Dempsey, fought once more against a second-tier heavy earning $990,000, and retired undefeated. One of his sons became a Senator.

He married a woman who came from money - maybe that helped.

The rest of the heavyweight champions is much of a muchness - mostly easy come, easy go. John L. Sullivan drank away everything he earned, although late in life he became a temperance advocate. Jim Corbett was never terribly rich, but he scraped by as a trainer and handler - he appeared in a couple of low-budget films and a vaudeville show or two. Bob Fitzsimmons never earned much, and he died of pneumonia in his 50s. Jim Jeffries did OK - he owned an alfalfa farm, and promoted some fights. His barn is now part of Knott’s Berry Farm - I’ve seen it. Jack Johnson spent everything as fast as he earned it. He died in a car crash, and the car was a gift for publicity.

Jess Willard was never enthusiastic about boxing - he started when he was 28. Dempsey smashed the hell out of him - as Willard left the ring after losing the title, jaw broken, cheekbone smashed, ribs cracked, he was said to mutter to himself over and over “I have $100,000 and a farm in Kansas. I have $100,000 and a farm in Kansas”. He tried a comback later, but Firpo knocked him out and he stayed on his farm for the rest of his life.

Max Baer spent it all. He would sell a piece of his future earnings when short of cash - at one point he sold 117% of his future. Jim Braddock, the Cinderella Man, lost whatever he earned in bad investments, and went back to blue-collar work for the rest of his life.

Dempsey lost a lot of his money in the Depression, but founded a successful restaurant. Tunney has been mentioned. Jack Sharkey did OK - he became a professional fly fisherman. Max Schmeling lost a lot in the war, but he owned the Coca-Cola franchise for West Germany and was actually moderately well-to-do, eventually. Louis lost it all, and wound up living in a casino on the charity of the owners, and still owed the IRS a million bucks. He was once asked if he regretted not fighting in the modern era. He replied “Nah - I would have wound up owing the IRS ten million instead of just one.”

Ezzard Charles never earned much - he was unpopular for not being Joe Louis, and had to keep fighting for years after he should have quit. He died of Lou Gehrig’s disease, and needed a fund raiser to pay his bills. Jersey Joe Walcott also never earned big money - he became a deputy sheriff after a while.

Rocky Marciano was never poor, but he lost most of his ring earnings in bad investments. He died in a plane crash before he ran out of what was left.

Floyd Patterson kept fighting for way too long. He wound up working in a sinecure for the New York State Athletic Commission, but had to quit when it became clear that he was too punch-drunk to remember his own secretary’s name.

Sonny Liston lost it all to heroin, and died of an overdose. Ali pissed it away on divorces, although he could always make a living being Ali. Frazier ran a gym. Foreman hit on his jovial fat guy image, and the Grill, and made an incredible comeback to win the title back in his late middle age. Spinks lost everything - I think he was homeless for a while, and last I heard was working as a school janitor.

Larry Holmes seems to be an exception. He has a lot of investments in Easton, including an office building, and seems to be more than OK financially.

It’s too soon to tell if any more modern champions will wind up with what they earned.

Regards,
Shodan

45

I understand that MC Hammer went through some $46M (including the $13M in debts on the record when he filed for bankruptcy).

46

Shodan covered many of the boxers. I’ll add Pittsburgh’s own Billy Conn. I delivered the Pittsburgh Press to Billy circa 1968. He had a beautiful home but was pretty unaware of what was going on (punch drunk). One time when I was collecting for the paper he invited me in, then went to get my money. He left the house via a different door.

I waited maybe 45 minutes before I realized he wasn’t coming back. When I left the house sirens went off. I waited another ten minutes and the police showed up. I told them what had happened and they laughed. I was 10 years old, yet somehow understood what was up.

47

Leonard Tose was trucking magnate who owned the Philadelphia Eagles. He was forced to sell the team for 65 million to pay off gambling debts. He died broke living in a hotel room after his mansion was seized for non payment of taxes.

48

Wilfred Benitez is much the same, except he has no money. Started boxing when he was 15, retired when he was 32, won multiple titles in multiple divisions, currently too brain-damaged to speak.

Regards,
Shodan

49

Louis donated millions to war charities and then the government decided he owed taxes on that money and owed them a half a million dollars. He was forced to come out of retirement pay off the bill. However tax rates were so high that he could only keep 10% of his purses which wasn’t enough to pay the interest of the debt. He lost two title fights and ended up owing over a million to the IRS because of accumulated interest and penalties. He had to make professional wrestling appearances and take the charity of friends in his later years.

He was really screwed over by the government.

50

He moved to Las Vegas to sell his autographs at boxing shows. He has brain damage.

51

This thread has made me rexamine what I meant a bit. I am not 100% sure what I meant at this point.

Does a person have to blow all their fortune, or just part of it?

Also what constitutes blowing it?

If Bill Gates had lived the kind of lifestyle that Evander Holyfield or Mike Tyson or Michael Jackson lived (spending 20-40 million dollars a year), it would’ve barely affected his 100 billion net worth even after doing it for 40 years. But he still would’ve blown a huge amount of money.

And what is blowing money? I don’t know anymore. I assume it is living a lifestyle you can’t sustain. But a lot is personal choice. Mike Tyson used to give out pieces of jewelry worth $65,000 to homeless people and give expensive cars to women he just met. I guess ‘blowing money’ is leading an unsustainable lifestyle and buying items that are very extravagant by mainstream tastes. I don’t know. I wouldn’t consider donating $10 million to charities to help the poor to be blowing it. But if you give 10 million dollars worth of expensive jewelry and cars to poor people (your friends, women you just met, etc) I would consider that blowing it. I guess the first is an effort to help the poor rise above their station in life, while hte other just seems wasteful. I guess thats what it comes down to, wasteful and unsustainable spending = blowing.

I mean Holyfield had a 109 room mansion. Had he been the kind of person who was happy with a 50 room mansion, he probably would’ve been financially secure for life.

52

How about Jocelyn Wildenstein. Apparently you can blow billions on bad plastic surgery.

53

I’m pretty sure Ray Leonard is still very well off.

54

And their financial managers are often family members, who have no fucking clue what they’re doing, but will siphon off money for themselves. Broke is an excellent documentary and well worth watching.

I think it was Louie Anderson in an interview who stated when he was making money an uncle quit his job and told him it was Louie’s responsibility now to support him and when could he expect his check. Family members you’ve never heard of before come out of the woodwork looking for a handout.