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Celebrities Who Went Bankrupt Because of Their Terrible Decisions

We’re all entitled to making a few bad decisions in life. Mistakes happen. None of us are perfect.

While we all know this, sometimes we forget that celebrities are human just like us. We tend to pedastal stars and forget that they are prone to the same kind of flawed logic, impulsiveness, and hasty decision making that the lot of us are all guilty of at some points in our lives.

In this video, however, we aren’t just going to be discussing celebrities who made a few innocuous blunders that they quickly recovered from. No, instead we’re going to be talking about stars who once resided in the upper echelons of the financial elite only to come crashing down to earth, losing all of their wealth in the process and inevitably having to file for bankruptcy.

Yes, the celebrities we’re about to cover not only made several woeful and wildly ill-advised financial choices, but they ended up broke as a joke, scrambling to salvage what little they had in order to avoid a life of destitution and abject poverty.

Sometimes this was the result of a celebrity living a lavish lifestyle that went beyond their means, while others neglected to pay their taxes and wound up with Uncle Sam knocking on their doors demanding that they pay back every last penny they had to cover their debts. As you will soon see, there are many different reasons why stars fall.

Keep watching to learn all about six celebrities who declared bankruptcy and the apparent reasons why they ended up in this precarious financial situation.

Marvin Gaye

Known for hit singles such as “What’s Going On” and “Heard It Through The Grapevine”, legendary soul singer Marvin Gaye was forced into bankruptcy in 1976 after going through a pretty dicey divorce. The settlement ended up requiring Gaye, who was already in a rough financial place, to pay his ex-wife all of the royalties from his next album, Here My Dear, in order to make up for the $600,000 in alimony that he owed.

It’s also been alleged that another reason why Gaye ended up in this terrible financial bind had to do with his increasingly expensive and rapidly escalating coke habit. Those in his circle noted that the singer was burning through his savings at a very concerning pace.

Because of these two factors, Gaye spent his final years dealing with crippling addiction and financial problems. Ultimately, his life was cut short when his own father shot him to death during a heated argument over money.

Larry King

The late television personality had a net worth of nearly $150 million at the time of his death in 2021, but there was a time in his life when he had no other choice but to file for bankruptcy. The famed talk show host’s career began in radio, and despite his relatively small salary back then, he was known to live well beyond his means.

In 1971, King was arrested for allegedly stealing $5,000 from one of his business partners. Even though those charges were eventually dropped, his reputation took a hit, and it would be years before King recovered from the incident’s fallout.

He struggled to find work following the arrest, and in 1978 King filed for bankruptcy after finding himself with over $350,000 in debt. Fortunately, King was hired on later that year as a late-night radio talk show host. This gig eventually led to his long-running TV series Larry King Live.

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Burt Reynolds

In December of 1996, Reynolds filed for Chapter 11 bankruptcy. The world was caught off guard by this move as Reynolds had been one of the most prominent stars in the world for the better part of two decades.

In the 70s, Reynolds had appeared in films like Deliverance and Smokey and the Bandit. These roles cemented him as a celeb that had a lot more to offer than just his handsome looks. While he made millions in Hollywood, his high-profile divorce from actress Loni Anderson in the early 90s dealt a substantial blow to his bank account.

At the peak of his career, Reynolds estimated that he had amassed more than $60 million, but by the time of his bankruptcy declaration, he was more than $10 million in the hole.

But it wasn’t just his divorce that caused his wealth to go up in flames. Burt’s lavish lifestyle was something that he wasn’t shy about flaunting. He bought several mansions in Beverly Hills, built a huge seaside estate in Florida, acquired a 160-acre ranch also in Florida, and maintained a stable of 150 horses.

Reynolds also purchased a mansion in Georgia, got a private jet and helicopter, and regularly indulged in the most luxurious consumables. If it wasn’t top-shelf single-malt or a good year, he didn’t want to drink it. And Burt would never be caught dead wearing anything other than the fanciest designer threads.

And then came the bad investments. In the 80s, Burt’s business manager convinced him that it would be a good idea to invest in a chain of family-friendly country restaurants called Po’ Folks. While the investment looked pretty good on paper, seeing as how the chain was thriving at the time, the parent company that owned the restaurants ended up being a disaster to work with, and the public generally didn’t seem to care much for the restaurant’s food.

Reynolds and his business partner hired a consultant to help them get out of the business, but that so-called expert ended up convincing him to instead invest in another chain of restaurants. Long story short, both investments proved to be terrible ones, and Reynolds and his partner ended up losing somewhere between $20-30 million.

If that wasn’t bad enough, in 1990, Reynolds borrowed $4 million from CBS while starring in the series Evening Shade. He figured that if the show was able to air for five seasons and then enter into syndication, he’d be able to not only pay back his loan, but also net a few million for himself. The series ended up getting canceled in 1994 after airing for four seasons. To qualify for syndication, it would have needed 100 episodes. Unfortunately for Burt, only 98 episodes of Evening Shade were produced.

So, then Burt was required to pay back the network all of that money he had borrowed. The only problem was, he didn’t have it. Then Loney filed for divorce. At this point, Reynolds likely felt like he was drowning.

His 1998 bankruptcy court disclosure listed his assets as being valued at $6.65 million while he owed $11.2 million in debts. In addition to CBS and his ex-wife, Reynolds also owed money to the IRS, Chase Bank, his former manager William Morris, Creative Artists Agency, and shockingly a whopping $121,000 to his toupee maker of all people.

After appearing in 1996s Striptease and 1997s Boogie Nights, Reynolds career was reinvigorated for a few years, but his wealth would never reach the heights of his 1980s heydey. Reynolds spent the remainder of his life living on a 3.4-acre property in Palm Beach County. At the time of his death in 2018, Reynolds net worth was estimated at about $5 million.

Gary Colemon

While Colemon was the star of Diff’rent Strokes, he was the highest-paid actor on TV. Unfortunately, his wealth would quickly deflate like a tire that just ran over a nail. When his sit sitcom ended, the actor struggled to find new roles. Health problems and medical bills ate up a large chunk of his money as well.

In 1999, he was left with no other choice but to file for bankruptcy. At that time, Colemon was $72,000 in debt due to unpaid medical bills. Just a decade earlier, he had a net worth of about $7 million.

Health and financial problems would continue to plague Colemon for the remainder of his life. In 2010, Colemon passed away virtually penniless at the age of 42.

Gary Busey

Even though Busey had a long and consistent career in television and film, appearing in flicks like Lethal Weapon and Predator 2, in 2012, he filed for bankruptcy while declaring debts between $500,000 and $1 million.

Busey had been involved in a near-fatal motorcycle accident in 1988 that left him with a traumatic brain injury that resulted in a strong shift in his personality. For the next several years, Busey heavily abused cocaine before getting clean and converting to Christianity in 1995.

When he filed for bankruptcy, Busey owed money to the IRS, various medical facilities, and to a woman that he had attacked in 2011. It’s estimated that in 2022, Busey’s net worth is only about $500,000.

Tom Petty

The late rock legend Tom Petty famously filed for bankruptcy in 1979, not because he was in financial peril, but as a legal gambit to free himself from the shackles of a restrictive contract that he was under with his label at the time.

The music industry’s modus operandi is to pay artists advances against future earnings. This resulted in Petty eventually discovering that he was deeply in debt to the label. His lawyer also informed him that when he signed with the label, he had given away 100% of his publishing royalties for a $10,000 advance.

By filing for bankruptcy, this forced the court to readjust his business arrangements which in turn voided his contract with the label.

So, there you have it! These 6 celebrities who filed for bankruptcy all had their own unique reasons why they needed to do so. Some of them recovered, while others spent the remainder of their lives scraping to get by.

Did you know that Tom Petty once filed for bankruptcy to get out of his contract with his record label and that Burt Reynolds lost millions by investing in a failing restaurant chain? Let us know in the comments section down below.

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