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Celebrities Who Were in Debt

Celebrities Who Were In Debt & Dug Themselves Out

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Celebrities Aren’t Immune From Financial Woes

We’ve all heard stories of famous stars blowing through fortunes or unexpectedly plunging into debt. Despite their million-dollar paychecks, endorsements, and lavish lifestyles, even the most recognizable faces in Hollywood and beyond can find themselves in serious financial trouble. Whether it’s reckless spending, unexpected legal woes, or a surprise health crisis, celebrities aren’t shielded from the everyday money challenges that many of us face.

But here’s the encouraging part: Many of these high-profile individuals don’t stay down for long. Through determination, creative solutions, or simply learning from past mistakes, they often manage to bounce back—sometimes even more financially stable than before. Seeing these seemingly untouchable stars fight their way out of money problems should remind us that there’s always hope for a turnaround.

Below, you’ll find some noteworthy examples of household names who stumbled financially—and discovered a path back to solid ground. After all, if they can regain control of their finances, there’s no reason we can’t do the same.

1. Allen Iverson: Jewelry

NBA legend Allen Iverson earned around $200 million during his career but ended up filing for bankruptcy in 2012. A big reason? His affinity for pricey bling. At one point, he reportedly owed $859,000 to a single jeweler alone. Fortunately for Iverson, he had a $32 million trust fund set up by Reebok, which helped him regain his financial footing and pay down debts.

Key Lesson: Even a jaw-dropping income can vanish if you’re not mindful of your spending.

2. Kim Basinger: Costly Movie Disputes

Kim Basinger soared through the 1980s with a string of hits, yet by 1993, she found herself tangled in lawsuits that led her to declare bankruptcy. One high-profile case? She backed out of the film Boxing Helena, resulting in an $8 million court judgment against her (later overturned on appeal). Despite the turmoil, Basinger’s career survived—and she’s remained a successful, award-winning Hollywood figure.

Key Lesson: When you sign a contract, backing out can carry a huge financial toll.

3. Toni Braxton: Mansions & Medical Bills

Toni Braxton filed for bankruptcy in 2010 with debts reportedly hitting $50 million. Known for her lavish taste in real estate, Braxton struggled when a major Las Vegas show was canceled due to her lupus diagnosis—drying up a crucial income source. She officially completed her settlement in 2014, only to buy another high-priced property soon after.

Luckily, the R&B legend continues to release music—her 2020 album garnered solid buzz—and appears on Braxton Family Values. Braxton shows that you can keep going despite repeated financial setbacks.

Key Lesson: Even legitimate expenses (like medical costs) can derail finances. A proactive plan and backup fund are essential.

4. 50 Cent: Lawsuits & Wealth Mismanagement

50 Cent once seemed unstoppable, topping charts and launching successful business ventures. But behind the scenes, mounting lawsuits and unpaid obligations drove him into debts reportedly exceeding $32 million. In 2015, he filed for bankruptcy protection.

Things turned around by 2018, when he made waves for having once dabbled in Bitcoin—he claimed (albeit with some controversy) that he’d generated huge gains from it. He’s since repaid debts, stayed active in music and TV production, and remains a powerful hip-hop figure.

Key Lesson: Diversifying your income streams can help—provided you keep close track of your liabilities.

5. Da Brat: Assault Conviction Fallout

Da Brat (Shawntae Harris) hit platinum status with Funkdafied in 1994, but by 2018 she was in bankruptcy court. After serving nearly two years in prison for an assault in 2007, a civil court ordered her to pay $6.4 million in restitution to her victim. When she failed to pay, additional penalties piled up, pushing her total debts above $7 million while her assets sat at just $108,000.

She began auctioning off personal items, including several cars, to chip away at the massive sum. Although it’s a tough road, Da Brat’s perseverance illustrates how it’s possible to tackle debt head-on.

Key Lesson: One life-altering event—a lawsuit, health crisis, or legal conviction—can dramatically change your financial picture.

6. Mike Tyson: Luxuries & Tigers

Former heavyweight champ Mike Tyson blazed through hundreds of millions of dollars on everything from mansions to a collection of exotic animals (yes, including tigers). Combine that with legal issues, taxes, and lavish spending, and he was forced to seek bankruptcy protection in 2003.

Tyson overcame his debts through a mix of public appearances, boxing events, and business ventures, including the popular “Mike Tyson Mysteries” animated show. He’s living proof that massive financial trouble doesn’t have to be a knockout punch.

Key Lesson: Even if you earn nine figures, living way beyond your means can quickly drain your wallet.

7. Lindsay Lohan: Sky-High London Rent

Child star turned Hollywood A-lister Lindsay Lohan watched her fortune dwindle after pricey real estate deals (including a reported $103,000/month London apartment) and legal issues. At one point, she allegedly faced near-bankruptcy.

Lohan has since pivoted toward more stable ventures, including a Netflix film and her own businesses, showing that discipline and a willingness to adapt can put you back on track.

Key Lesson: Recurring expenses, like rent or mortgage, can sink you fast if they’re out of proportion to your income.

8. Debbie Reynolds: Risky Hotel & Casino Venture

Hollywood legend Debbie Reynolds bought and renamed the Paddlewheel Hotel in the 1990s, turning it into “Debbie Reynolds’ Hollywood Hotel.” But the project was plagued by limited profit sharing with the attached casino, leading to mounting losses. Reynolds was forced to declare bankruptcy when the venture failed.

She eventually sold off the property to pay down debts, and while it was a rocky road, she later enjoyed a resurgence with live performances and TV appearances. Reynolds’ story reminds us that even a beloved entertainer can stumble when a business deal goes sour.

Key Lesson: Dipping into a risky venture without a solid profit path can devastate personal finances.

9. Dionne Warwick: Shopaholic Tendencies

Despite a legendary career (“That’s What Friends Are For,” anyone?), Dionne Warwick hit financial rock bottom in 2013. Citing “negligent and gross financial mismanagement” plus a penchant for shopping, she claimed tens of thousands in credit card debt and filed for bankruptcy. Still, she persevered: Warwick continued touring internationally, staying active in the music scene, and rebuilding her finances.

Key Lesson: Credit card debt can balloon surprisingly fast, even when you’re earning well. Consistent tracking matters.

10. Willie Nelson: The IRS Tapes

No celebrity-debt list is complete without country star Willie Nelson. In 1990, the IRS slapped him with a $16.7 million bill for unpaid taxes. Nelson famously recorded and released a double album, The IRS Tapes: Who’ll Buy My Memories?, to help raise funds for repayment.

After some tough years—including selling off property—Nelson got back on his feet. He remains an icon in country music and a testament to bouncing back from major tax trouble.

Key Lesson: Don’t underestimate tax obligations. If you fall behind, work out a plan—before the IRS forces one on you.

There’s Hope for Us All

Maybe you haven’t spent six figures on a luxury rental or racked up massive debt buying exotic pets. Most of us can barely imagine having that kind of spending power! Yet these stories go beyond mere celebrity gossip. They’re powerful reminders that a big paycheck doesn’t guarantee permanent financial security—and that financial missteps can happen to anyone.

At the same time, these examples offer a resounding message of hope. Look how many celebrities managed to conquer their debt through hard work, new ventures, or sheer persistence. Their road to recovery often involved painful lessons, but it also showed that no matter how deep the financial hole, it’s possible to climb your way out.

Disclaimer: This article is for informational purposes only. It does not constitute financial or legal advice. If you have questions specific to your situation, consult a qualified professional.

About the Author

Picture of Rick Munster

Rick Munster

Rick Munster is a personal finance expert and author with over 23 years of experience in the credit counseling industry. He currently serves on the board of directors for the Financial Counseling Association of America and has published more than 250 articles on personal finance. Over the course of his long-standing career at Money Fit, a nonprofit credit counseling organization, Rick’s insights have been featured by several news outlets on topics such as credit counseling, debt management, and financial education.
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NOTE: This sheet is to inform new or returning clients about our services, records, fees, and limitations that may affect you as a consumer of our services. This form also discloses how we might release your information to other agencies and/or regulators. If you do not understand a statement, please ask a Debt Reduction Services (DRS) counselor for assistance.

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To provide our financial education and credit counseling services, we collect nonpublic personal information about you as follows: 1) Information we receive from you, 2) Information about your transactions with us or others, and 3) Information we receive from your creditors or a consumer reporting agency. We do not share this information with outside parties.

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Disclosure to Client for HUD Housing Counseling Services

Debt Reduction Services, Inc. and its financial education arm, Money Fit by DRS, offer the following housing counseling and educational services related to housing, personal finance, and bankruptcy certificates to consumers:
  • Housing Education Courses: DRS offers many online self-guided education programs classified as Financial, Budgeting, and Credit Workshops (FBC), Fair Housing Pre-Purchase Education Workshops (FHW), Homelessness Prevention Workshops (HMW), Non-Delinquency Post Purchase Workshops (NDW), Predatory Lending Education Workshops (PLW), Pre-purchase Homebuyer Education Workshops (PPW), and Rental Housing Workshops (RHW). These courses help participants increase their knowledge of and skills in personal finance, including home affordability, budgeting, and understanding the use of credit, as well as predatory lending, loan scams, and other fraud prevention topics, fair housing, rental topics, pre-purchase homebuyer education, non-delinquency post-purchase topics including home maintenance and/or financial management for homeowners, homeless prevention workshop, and other workshops not listed above relating to personal finance and housing. Course details are found below under “Housing Workshops.”
  • Home Equity Conversation Mortgage (HECM) Counseling (RMC): Via telephone and virtual platforms, we offer the required HECM counseling nationwide in addition to in-person counseling in Boise, Idaho. We also offer in-home counseling options in thirty counties across southern Idaho for an additional fee to cover our travel and additional staff time costs.
  • Home Maintenance and Financial Management for Homeowners (Non-Delinquency Post-Purchase) (FBC): Clients receive counseling and materials on the proper maintenance of their home and mortgage refinancing. Clients can find help and resources by phone, in our Boise office, or virtually on all topics related to stabilizing their long-term homeownership.
  • Services for Homeless Counseling (HMC): Clients receive phone, virtual, or in-person (Boise) counseling to evaluate their current housing needs, identify barriers to and goals for housing stability, establish a path to self-sufficiency, and connect with emergency shelters, income-appropriate housing, and/or other community resources (e.g. mental healthcare, job training, transportation, etc.).
  • Pre-Purchase Counseling (PPC): Clients receive counseling through the entire homebuying process. Assistance may involve creating a sustainable household budget, understanding mortgage options, building their credit rating, and putting together a realistic action plan to set and achieve homeownership goals.  Additionally, clients will receive materials and resources about home inspections and other homeownership topics relevant to successfully maintaining a home.
  • Rental Housing Counseling (RHC): Via phone, in-person appointments (Boise, ID), or virtual platforms, clients receive housing counseling relevant to renting, including rent subsidies from HUD or other government and assistance programs. Topics can also address issues and concerns having to do with fair housing, landlord and tenant laws, lease terms, rent delinquency, household budgeting, and finding alternate housing.
DRS also offers the following services:
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  • The Budget Briefing and Debtor Education Certificates that are required during the Bankruptcy filing process;
  • A Student Loan Repayment Plan Counseling and application service.

Relationships with Industry Partners

Through such services, DRS has established financial relationships with hundreds of banks, credit unions, and creditors such as American Express, Bank of America, Barclays, Capital One, Chase, Citibank, Credit One, Discover, Synchrony, US Bank, USAA, Wells Fargo, and others.

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The client is not obligated to receive, purchase or utilize any other services offered by DRS or its exclusive partners to receive financial education or housing counseling services. Alternatives: As a condition of our counseling services, in alignment with meeting our client services goals, and in compliance with HUD’s Housing Counseling Program requirements, we may provide information on alternative services, programs, and products available to you, if applicable and known by our staff. Alternative DMP services include negotiating better repayment terms directly with your individual creditors, paying your debts as agreed, or, in extreme cases, filing for personal bankruptcy. Alternative credit and education services can be found through MyMoney.gov or the Jump$tart Clearinghouse of online financial education resources. Housing counseling alternatives can be found through HUD at www.hud.gov/findacounselor.
Finally, you understand that you may revoke consent to these disclosures by notifying DRS in writing.
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Housing Counseling and Education Fee Schedule

 

Online Education Program Fees*

Homebuyer Education Course: $59 per participant

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours)

Rental, Fair Housing, Predatory Lending / HOEPA, Post-Purchase (Non-delinquency post-purchase workshop, including home maintenance and/or financial management for homeowners) Online Workshops: $49 per participant

  • Approximately 1 hour each

Other Self-Guided Financial Literacy Webinars (e.g. credit, budgeting, homeless prevention, debt prevention): $0

One-on-one Counseling Fees*

Pre-purchase Homebuying Counseling, Rental Counseling, Post-purchase Ownership Maintenance and Financial Management: $75

  • Session by the hour

Reverse Mortgage/HECM Counseling with Required Certificate:

  • $200†

Credit Report Fee: Paid Directly by Client

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page

†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there).

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Housing Counseling and Education Fee Schedule  

Online EDUCATION Program Fees* 

eHome Homebuyer Education Course: $99 per household** 

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours) 

Online Workshops: $49 per participant 

  • Rental, Fair Housing, Predatory Lending Post-Purchase, HECM Family Member  
  • Approximately 1 hour each 

Other Self-Guided Financial Literacy Webinars: $0 

  • Credit, budgeting, homelessness prevention, debt prevention 
  • Approximately 30-60 minutes each 

One-on-one COUNSELING Fees* 

Pre-purchase Home Buying, Renter Issues, Homelessness, and Fair Housing: $0  

Post-purchase Ownership and Maintenance, HOEPA or Financial Management $75/hr  

Reverse Mortgage/HECM Counseling with Required Certificate $200 per household†  

Credit Report Fee Paid Directly by Client 

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable 

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page 

**Household is an individual or a couple  
†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there)