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I Stop Celebrities from Blowing Their Money

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Re: I Stop Celebrities from Blowing Their Money

#11

Post by carlivar »

craftyguy wrote: post #9
myroon5 wrote: post #6

"I charge a 5 percent commission rate, which is pretty standard" 5 percent of what?

Yea that's kind of key. 5% of total income for financial advising seems a bit steep, BUT if they're a high risk of spending it all on hookers and blackjack then maybe it's best for them? I'd rather see 5% go towards financial education in schools, but hey, then this person would be out of a job.

Financial education in schools hardly applies to this situation. As the article states, much of this is helping out people that are extremely distracted by their careers and are on the road constantly. Even with the motivation, I bet the time and energy for artists to think about finances would be more than a 5% hit to their career/output etc.

It's the same reason startups are happy to pay fairly high cloud prices so as not to have to deal with staffing network engineers and stuff like the old days.

Re: I Stop Celebrities from Blowing Their Money

#12

Post by godot »

Thought this bit was interesting: "... actors, recording artists, producers, writers, and athletes with personal net worths ranging from $1 million to $50 million..."

I kind of feel bad for the low end of her clients whose net worth is only $1 million. Don't get me wrong, it's a lot of money. But it also doesn't go that far nowadays, especially if you live in SF Bay area (though most of her clients are probably in the LA area; slightly better but not by much). You can't even afford a decent house with cash for that amount of money. I feel bad for the client who has $1m but thinks he/she has a lot of money, and needs to pay a financial adviser (5% even!) to manage it for him/her. In this day and age and in California, if you have $1m, you'd better be working hard still and save up for retirement.

Re: I Stop Celebrities from Blowing Their Money

#14

Post by scurvy »

nixgeek wrote: post #8
myroon5 wrote: post #6

"I charge a 5 percent commission rate, which is pretty standard" 5 percent of what?

I presume it’s their income, or assets under management. Pretty sweet deal if so compared to the 2-and-20 a lot of investment managers make.

AUM

Re: I Stop Celebrities from Blowing Their Money

#15

Post by charmides »

godot wrote: post #12

Thought this bit was interesting: "... actors, recording artists, producers, writers, and athletes with personal net worths ranging from $1 million to $50 million..." I kind of feel bad for the low end of her clients whose net worth is only $1 million. Don't get me wrong, it's a lot of money. But it also doesn't go that far nowadays, especially if you live in SF Bay area (though most of her clients are probably in th…

I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive.

Re: I Stop Celebrities from Blowing Their Money

#16

Post by rurban »

charmides wrote: post #15
godot wrote: post #12

Thought this bit was interesting: "... actors, recording artists, producers, writers, and athletes with personal net worths ranging from $1 million to $50 million..." I kind of feel bad for the low end of her clients whose net worth is only $1 million. Don't get me wrong, it's a lot of money. But it also doesn't go that far nowadays, especially if you live in SF Bay area (though most of her clients are probably in th…

I would guess that those clients are young and with high income, so their net worth may not be that meaningful yet. Otherwise, they would be well-advised to fire their financial manager, take their million dollars and live somewhere less expensive.

That does not work, because you are out of work then. Nobody will meet you or call you out of the blue.

Re: I Stop Celebrities from Blowing Their Money

#17

Post by holman »

If any of this is at all interesting to you, I'd recommend checking out the very excellent ESPN documentary "Broke": http://www.espn.com/30for30/film?page=broke

ESPN's 30 for 30 docs are really great, even if you're not particularly huge into sports. Broke is one of my favorites (after a "The Two Escobars"). It goes into a lot of detail about how ill-prepared many professional athletes are for the lifestyle, how they overestimate their net worth and their projected career duration, and digs into all of the different pitfalls new signees might face as they enter sport. It's easy to blow it off and say "whatever, they're all soft, tattooed millionaires anyway", but there's a lot of heartbreaking instances where people did the right thing and still ended up bankrupt.

Anyway, worth a viewing.

Re: I Stop Celebrities from Blowing Their Money

#18

Post by charmides »

Zaheer wrote: post #2

Mildly interesting article but mostly reads like an advertisement. Great content marketing piece though!

The short, simple sentences and the unassuming vocabulary made it feel like an ESL piece for college students. I also found it moderately interesting, but it really could have benefited from a more personal touch (why and how did she get into this business?) and longer, more engaging anecdotes.

Re: I Stop Celebrities from Blowing Their Money

#20

Post by hkmurakami »

myroon5 wrote: post #6

"I charge a 5 percent commission rate, which is pretty standard" 5 percent of what?

At 5% AUM, you might as well put it in cash, when you consider risk adjustmentd and post tax investment returns.

But skimming this article, it's not just investment returns really. I guess these people really are liable to blow all their money on stuff off left to their own devices.

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