Please Don’t Listen to Celebrities for Financial Advice

by Jason Unger

While superstar athletes may be the worst possible role models when it comes to financial advice, celebrities are not that far behind.

For every Jay Leno, who actually does know how to manage his money, there’s a Nicolas Cage (multiple homes in foreclosure, and had to sell his castle) or a Wesley Snipes (tax evasion) … if not a few of each.

Plus, let’s face it: most celebrities have a lot more money than you or I do. But that certainly doesn’t mean they’re smarter about managing it.

Conveniently, I recently stumbled upon a “Celebrity Q&A” on highlighting that exact point.

Bankrate talked to more than dozen celebrities, but let’s take a look at the “wise” path chosen by comedian (and sometimes Comedy Central Roaster) Lisa Lampanelli:

Bankrate: Do you also do a lot of investing, like stocks and real estate?

Lisa Lampanelli: I tell my girl at AG Edwards, “Do whatever.” And my financial guy — I have a guy who does my financial planning — I let him handle it. I owned an apartment in Manhattan, but I sold it and moved to Connecticut and bought a place there. I never rent anything anymore, because you can’t really lose when buying a house. My mother always said, “Be the worst house in a good neighborhood instead of the best house in a bad neighborhood.” I’ve always viewed myself as the worst house in a good neighborhood.

What’s wrong with this statement? We’ll, let’s get started …

  1. Not knowing what your investment adviser is doing is asking for trouble. Should she be aggressive and try to increase her wealth, or conservative and maintain what she has? And how much is it all costing? Is she getting what she’s paying for?
  2. Same thing with the financial guy. It’s not a bad idea to have someone manage your finances for you, but the careless attitude is only going to hurt — and cost — her.
  3. “You really can’t lose when buying a house.” Sounds like typical mid-2000s talk during the real estate bubble, but this story was posted in June of 2009, after the greatest real estate bubble bursting we’ve probably ever seen!

This is not a person you want to look to for financial advice. Just because you can tell a joke or hit a baseball 400 feet or act in movies doesn’t mean that you know what you’re doing.

I hope that you aren’t listening to celebrities when they talk about their money. Because you’re smarter than they are.


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