Even A Billionaire Can Go Broke

by Pam on April 25, 2011

My husband came across a bizarre Yahoo! Finance article entitled From Billionaire To Broke about a woman who received a divorce settlement of about a billion dollars but who managed to squander it all away and she ended up in the hole to boot!  Even though she was able to earn about $1.6 million dollars in interest every week, she still managed to end up owing $66 million dollars to the bank in the end.

I bet you never thought it possible that someone with so much money could possibly go broke!  Well, it just goes to show you that it’s not really about how much money you have, it is whether or not you can actually handle it properly.  Many people that suddenly receive a lot of money just don’t have a clue what to do with it, and they don’t know how much they can safely spend.  The end result for many is the loss of all the money and often a whole lot of debt to add to their problem.

While most of us will never experience having to handle a billion dollars, we can still learn a lesson from this woman’s foolish experiences.  What is important is that we understand how much we can safely afford to borrow and spend.  Even though the banks may continue to increase our credit card limits and they may tell us we can afford to buy a luxury vehicle or fancy home, this simply may not be true.  Be honest with yourself about your spending habits and seek financial guidance from someone you trust. That way if you ever do end up with a billion dollars, you will know exactly how to handle it!

 

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