What Michael Jackson Teaches Us About Money
A collective gasp was heard around the world last week when the news broke about the death of Michael Jackson. Known as the King of Pop, Jackson was arguably one of the wealthiest and most popular musicians and artists of all time. His legacy teaches us a great deal about life and money.
At one time, Jackson’s popularity and musical talent made him one of the richest artists ever. During the 1980’s and ’90’s he regularly made over $50 million a year and earned $125 million in 1989 alone. Most, if not all of us, will have no idea what it’s like to even come close to that kind of bankroll. So how can a guy whose estate is estimated over $1 billion teach us about money? Below are a few positives and negatives we should consider with our own money and finances:
Have an estate plan
Having an estate plan (at the very least a will) is a key component to a personal financial plan, especially those with young children because they can name a guardian in the will. Other key components to a good estate plan include a living will, durable power of attorney, health care directives and possibly a trust. Michael took the right steps in setting up a will and trust to make his estate settlement an easier process.
During his lifetime, Michael Jackson supported a wide range of charities with both his time and his money. He earned a spot in the 2000 edition of the Guiness Book Of World Records for the “Most Charities Supported By a Pop Star”. It is reported that Michael supported some 39 charities.
We often limit our joy in life because we hold on so tightly to our money thinking that it will make us happy, when in reality our lack of generosity is the very thing that robs us of experiencing a deep joy that God originally intended.
Care for the needy
Jackson regularly helped the poor and needy. According to Wikipedia, Jackson founded the Heal the World Foundation in 1992. “The foundation’s creation was inspired by his charitable single of the same name. Through his foundation, Jackson airlifted 46 tons of supplies to Sarajevo, instituted drug and alcohol abuse education and donated millions of dollars to less fortunate children, including the full payment of a Hungarian child’s liver transplant.”
Learn financial responsibility at a young age
According to Michael Jackson’s former Financial Adviser, Alvin Malnik, Jackson had no idea how to make good financial decisions. “I think that Michael never had any concept of fiscal responsibility. He was an individual that had been overindulged by those that represented him or worked for him for all of his life,” Malnik said. “Millions of dollars annually were spent on plane charters, purchases of antiques and paintings.”
It’s never too late to start learning about fiscal responsibility. There are a number of great personal finance blogs as well as other resources that can help you get started. If you are a parent, be sure you stress the importance of fiscal responsibility to your children. They will be glad you did.
Don’t spend more than you make
Many people make the mistake in believing that the more money you make the easier budgeting becomes. This is true in theory, however, in practice it is not. You can find story after story on the web of wealthy celebrities filing for bankruptcy. Why is this? It’s because getting yourself in a good financial position at the end of the day comes down to one simple thing: Spend less than you earn!
It doesn’t matter how much you make. If your outflows are bigger than your inflows you will have financial trouble. Michael Jackson ran into this same issue. Here is an excerpt from Michael Jackson’s Money Troubles, a CNN Money article posted in June 2005 when Jackson was going through his legal troubles:
The King of Pop, for all his assets, spends far more money than he generates these days, according to an expert who testified at Jackson’s trial. His legal costs alone topped $20 million in recent years and Jackson had more than 60 outfits made for his daily court appearances, according to CNN.com.
Don’t believe that money will buy you lasting happiness
One of the root causes of people spending more than they make and over-indulging in things they cannot afford is a desire to fill a void in their life. There is no question that there is a certain level of happiness derived from buying and using a new item, however, it doesn’t take long for that feeling to wear off.
Buying “stuff” does not bring lasting joy because it wasn’t designed to bring lasting joy. I made a point in an earlier post that happiness derived from money is fleeting. We were made to find our full joy, satisfaction and treasure in worshipping and being in relationship with our great God.
Money is a tool that can be used for good or for evil. It can be used for the betterment of others or the detriment of ourselves. Gaining control of our finances and recognizing the purpose behind our money will help us keep a proper perspective, avoid massive debt, and use it to help others.
At the very least everyone should have a solid, actionable financial plan that helps you create a budget, spend less than you make, give generously to others and save and invest for the future – all of which will glorify God when done with the right heart motive.