Money Lessons From T-Pain
“I had to, like, borrow money to [buy] my kids Burger King,” said Grammy-award-winning rapper T-Pain. In an August 2019 interview with The Breakfast Club, he revealed that he blew $40 million in just a few short years.
How did he do it? Reckless spending. He bought 36 cars, including a $1.2 million Bugatti Veyron, several houses, and made a lot of bad investments.
T-Pain wasn’t paying attention to his accounts since he had hired an accountant to do it for him. “I thought, if I didn’t have access to my own accounts, then I wouldn’t have to look at it,” he explained. To his demise, he quickly blew out one of the radiators of the Bugatti. The cost to fix it? About $90,000. He was running out of funds, per his accountant’s warning. T-Pain sold the car five months after its purchase and only received about $800,000 for it — a 33% loss on his “investment.” Additionally, he sold off about two-thirds of his collection since most of the cars were classics and even the smallest fixes were starting to add up.
An updated story from The Blast reported that his home in Florida is set to be foreclosed in late October of this year if he doesn’t come up with more than $100,000, which includes the principal of the alleged missed mortgage payments and the interest gained. The rapper states in the interview that he “almost” lost his home in Atlanta too (22:28).
“It was bad business choices,” he admitted. Bad choices it was; not only did he buy a lot of cars that he probably didn’t need, but he also didn’t make the smartest decisions in real estate. And once again, T-Pain wasn’t personally paying attention to what he bought — his manager, who was “way more optimistic” than he was, managed his real estate portfolio. None of the properties he bought ever sold.
Ultimately, the rapper summed it up pretty well: “You get back up and you learn, man.” So, here are four money lessons that we can learn from T-Pain.
Mind your money
Between 2008–2011, T-Pain was going hard — he was on every album, every music video, and every feature. He was most definitely putting in serious work to earn the $40 million that he ended up blowing. But no matter how “busy” you are, it is still important to be mindful of your money, especially if you decide to trust other hands with it. You may not know all the right questions to ask, but when it comes to the money you earned, you have every right to know where it’s all going. My suggestion is to budget for three months just to track your spending habits. You may be surprised at what you find.
Pick a GOOD financial advisor
Most financial advisors are easily accessible now-a-days thanks to fee-based advising. Check out this article on when to get a financial advisor, who you should choose, and the costs associated with that decision.
Save and/or invest your money
T-Pain did attempt to build a more diverse portfolio by investing, but not all investments will provide returns, especially when you are first starting out. You’re better off saving in the beginning. To find out how much to save, watch this video that we recently posted to our Instagram.
Make informed purchases
This sort of coincides with the first two points above, but it doesn’t hurt to reiterate. It is easier to spend money than we all think (really, we should all know from experience by now). Once it’s gone, you can’t get it back. Being more mindful of your purchases and thinking about the long-term effect or satisfaction that you might get from it should be considered. And that’s not to say that every purchase has to be a mindful purchase because sometimes it’s good to be a little carefree. Everyone deserves to treat themselves. However, having self-control when it comes to purchases can save you from a world of pain and struggle in the future.
