After reading about Annie Leibovitz's $715,000 debt from unpaid taxes, outstanding rental equipment fees, an uncompleted book deal, and renovation payments, I wondered: How in the world do rich people (Leibovitz earns at least $2 million a year through her Vanity Fair contract) go into debt? (For the record, Leibovitz says her debt issues have now been resolved.)
When I posed that question to several financial planners for an upcoming story, one of them made a point that stuck with me. The average consumer makes the same kind of financial missteps, says Tim Maurer, director of financial planning for Financial Consulate, a Baltimore advisory firm, but the only difference is that no one is watching. Whether it's leaving bills unpaid, like Leibovitz, failing to save, like Britney Spears, or facing foreclosure, like Dustin Diamond (aka Saved by the Bell's Screech), celebrities are just as vulnerable to bad money decisions as we are (or maybe even more vulnerable, because they have more money to lose).
Still, it's hard not to feel some amount of frustration with a celebrity's mismanagement of wealth—perhaps only because I'd like to believe that given the opportunity to manage millions, I would do it so much better.