Courtney Love wrote a fabulous article explaining the realities of a million-dollar album (2000 - https://www.salon.com/2000/06/14/love_7/) and it explains so much of whats actually going on that the public doesn't fully comprehend. Its a great read if you've never read it.
The realities are similar to what we are reading in this article. Most of what gets talked about is gross numbers not net. Most of the benefits of the job, are in the journey not the destination - if you're even into that stuff... i.e. having your music impact lives.
I wish sooooo much that people could read these things so when I go to a dinner party or random event, some GenPop person knew that JK Rowling makes billions of dollars but your average published writer loses money publishing a book. Your average NBA, NFL, MLB, NHL athletes are broke 5 years after they are out of the league. Fame, is mostly a curse.
Good on charli xcx for writing this and for writing period.
> Your average NBA, NFL, MLB, NHL athletes are broke 5 years after they are out of the league. Fame, is mostly a curse.
I'm not familiar with the financials of music / media production (I didn't read the linked article yet, sorry). But I feel this over-pitying attitude towards professional sports players is misplaced. They do often go broke after their career. That is sad. It is also completely avoidable with _very_ basic financial planning. I think feeling sorry for them is a disservice, because it makes it seem that this outcome is hard to avoid. It's not hard when they're making 500k+/year:
1. Spend (a lot) less than you make. At 500k/year anywhere in the US, you should easily be saving 200k / year.
2. Invest the money you've saved. There's lots of good advice online, and realistically if you're saving 200k/year you don't have to worry about making the best choices -- just decent ones.
3. Don't accept generic lifestyle creep!
People need to be responsible and take control of their finances. You can't rely on somebody else to watch your finances, or make you eat your vegetables, or brush your teeth. The same advice applies to lots of people in tech, IMO.
But often there are obvious and "easy" answers that are anything but easy for the person who needs those answers.
"Just cheer up, depressed person!"
"Just eat less and exercise more, fat person!"
"Just stop shooting up, heroin addict!"
"Don't accept generic lifestyle creep, pro athlete who's teammates are all living it up like they live in a gangsta rap music video!"
I'm sure there are lots of pro sports players that get and heed advice just like yours, and finish out their short and bright sports career well financially set for their remaining 60-ish years when they're no longer capable of earning half a mil plus a year being athletes.
But I'm also fairly sure the career and lifestyle, and the managers, hangers on, and sycophants they're surrounded with push then hard the other direction.
I'm not from the US, so I don't have a real understanding of US pro sports and the way people end up there, but I have this impression that it's "one of the ways out of the ghetto" for at least some of them. People who won the genetic lottery, but lost the birth demographics lottery. They've never had generation wealth or even a middle class safety net. They don't have family or friends who have experience or advice about what to do with suddenly having way more money that anybody the have even known. They don't have family or close friends who can recommend trusted financial advisors or lawyers. Any advice they're getting risks coming from people they ane not certain they can trust to have their own interests at heart, and aren't trying to skim their own percentage off the top.
I don't exactly pity someone who earns 500k+ a year in a short pro sports career, and blows it all ending up poor. But I think I can understand how the system is set up - if not to actively encourage that outcome, at the very least that system probably doesn't do as much to protect against it as they could.
> "Don't accept generic lifestyle creep, pro athlete who's teammates are all living it up like they live in a gangsta rap music video!"
I'm not sure lifestyle creep is actually the main problem that celebrities going broke suffer from. Stereotypically the lifestyle is something they can afford, but they make bad investments.
Can you expand on that? I feel like it’s the most misused and overused word in my vocabulary and one I wish I could just get rid of a lot of the time and never seem to manage. It just creeps in.
Just in the usage being complained about argues that whatever it is modifying does not need or benefit from analysis.
It just creeps in, but why? Why does it creep in? Often because we do not want to do the complicated analysis as to why things are the way they are because then it does not validate our preferences which are often emotional and not movable by logic anyway.
Just exercise more, fatty, says that the problem of being a fatty has a simple solution that anyone can see and there is no need to argue the point here. Start jogging!!
Just in the rather archaic meaning nowadays as being right and proper and what should happen in a fair and balanced universe is tangentially related, the archaic meaning of Just is memetically echoed in the assertive mode of Just doing things. If the world was fair and balanced and most of all really simple then Just jogging would cure the fatty, but it doesn't.
You are both right. Yes it’s very easy to just eat less or spend less. But it’s also nearly impossible for the obese or the athlete respectively. Because we need to recognize people don’t really have free will to do what they know is best. If we recognized that and acted accordingly then the world would be so much more reasonable to live in.
I think there's an even simpler point that people who make fun of athletes for blowing their paychecks instead of saving them miss:
* These are elite athletes at the top of their pyramid, which means they have an absolutely bonikers elite competitive drive that got them where they had so far.
They were probably the best player on every team they've been since kindergarten. They've made it to the top of the pyramid and most want to keep going. Championships, all-stars, MVPs, all of these are things they are USED to getting at every level so far, and they want to keep going.
So when they sign there $X00,000 rookie deal they're not thinking "OK how do i save the most of this for my retirement", they're thinking "how do i get $Y,000,000 deal next? And the $WZ,000,000 deal after that?" And of course then I'll be set for life, and it will be easy to save and retire cuz i'll be rich.
> Spend (a lot) less than you make. At 500k/year anywhere in the US, you should easily be saving 200k / year.
$500k/year sounds like a lot, but that's enough that taxes are going to take a large bite. Only the biggest stars can get their income deferred beyond their career. Because of the nature of the job, you're going to have larger housing costs: when you get traded, you need to find somewhere to live quickly and you might be on the hook for the old lease for some time; depending on the league, off-season training may happen in a different part of the country than the regular season, so you might need housing there too... Moving costs probably add up, because trades are immediate.
If you're only in the league for 5 years, chances are you're spending some time in the minors and you're typically not earning at your headling contract rate then... Also, a lot of the headline rates include bonuses for winning the championship which statistically few teams and players do.
There's also the problem that yes, these people need financial advice because they don't always have financial skills, but they also have trouble picking financial advisers because they don't always have financial skills.
Also, young people of all income levels get themselves into trouble with finance; higher income probably makes it easier.
I certainly agree that $500k/year for 5 years should leave you well off after, but it's not that surprising that it often doesn't.
I think we’re mostly agreeing, but I feel this is a little misleading:
> $500k/year sounds like a lot, but that's enough that taxes are going to take a large bite.
It seems to imply that taxes are going to make the $500k income life surprisingly hard, but let’s do the math. In California, with $500k income, your effective taxation rate is 41%, looking here: https://smartasset.com/taxes/california-tax-calculator#M0SXJ.... So you’re going to take home about $300k after tax!! I think that’s still _so much money_. I would struggle to spend that even if I tried to. Ya, the taxes are higher. But it’s not that big of an issue, once you’re making a ton of money it just doesn’t hurt much. That’s why graduated tax rates are tolerable to begin with, imo.
$300k net and you want them to save $200k. $100k net goes a long way, but they're probably renting at least two places, a lot of eating away from home (much of which I'm sure gets covered by the team, but probably not all of it) a lot of excess transportation. Excess tax prep cause of all the working in multiple jurisdictions, etc. Things will add up; thankfully I have all the coordination of a newspaper so I don't have to deal with the accounting problems ;p
Idk, maybe I’m out of touch, i still think 100k for loving expenses is more than enough. A nice apartment in Mountainview is like $3500-$4000/month. If you have to rent two apartments, presumably you’re not renting both in such an expensive area. I’d think housing can be covered by 60k/year pretty comfortably.
You need a certain kind of personality to be responsible financially, and it doesn't overlap with the personality required of a pop star or sports star.
Quite a few stars get scammed. "Our accountant/manager stole all the money" is not an uncommon thing.
Music and sports both have shady links to organised crime, so it's not a given that stars are going to be surrounded with the kindest and most professional people.
To be a good "team player", it's good to be liked by your teammates. If you want to be friends with your teammates, who all spend money like there's no tomorrow, it probably helps if you do the same.
I'm not saying you can't save up as an athlete, but it's probably harder than we think.
Seems unlikely to me. At that level (minimum salaries in NBA are around $1~3m, depnding on years of experience), even a 10% savings rate could ensure you're never totally "broke." I would find it hard to believe that the difference between spending 100% and 90% could be at all noticeable externally.
>They do often go broke after their career. That is sad. It is also completely avoidable with _very_ basic financial planning. I think feeling sorry for them is a disservice, because it makes it seem that this outcome is hard to avoid. It's not hard when they're making 500k+/year:
this is a good point and also I believe obviously wrong.
What are the stats on people making 500k a year on losing that going broke? Do they outperform sports stars etc.?
If it is the same then that implies that on the average people do not handle 500k basic financial planning well, or two that basic financial planning won't do what you say with that amount of money (for what, 5 years?). At any rate it would mean that generally people suffer this way and thus it is doing a disservice to point out how dumb they were for not doing basic financial planning.
If it is not the same then it implies that there may be something about the career that makes it harder then it does for other people in which case you are doing even more of a disservice.
I believe it is actually there is something about the career that makes it harder (this belief is formed by just thinking about it and doing absolutely no data analysis because I just do not have the time to devote to it past this HN post)
But I think we can create a thought experiment that shows why it is different
Many of us here are familiar with careers the top of which make 500k a year, there are a few engineers who could make that much. Or management at tech firms, it doesn't matter. There are people who can make that much.
Now if you lose your 500k job in tech what happens? You probably fall down a level to a lower paying job in tech. Let's say 390,000. That's a significant drop, but it's still a pretty nice wage.
The reason for this is because the tech career is a pyramid, 500k at or near top. And a pyramid means that the levels lower than the higher levels are wider (this being an analogy) and being wider has more entries for you to fall into.
Sports is also a pyramid. Or really several pyramids. There is the small pyramid of multi-million dollar players who can fall into single millions and then into the hundreds of thousands. But mainly the pyramid you are dealing with is an inverted pyramid. That is to say the sports career chart is top = player, most players, when you fall out of player level you fall into a level with fewer slots - coaches, commentators, agents, recruiters. If you can't fall into one of these slots and perform adequately (perhaps because you are doing a high paying job that also has high risks of causing brain damage [depending on sport obviously]) then when you lose your 500k sports job you are probably significantly worse off than most of us are when we lose our 500k programming jobs (obviously counterexamples abound, like if you lose job due to illness that means you won't get 390000 programming job either)
Anyway I believe your point that these people should not be pitied over much because they could handle their problems with basic financial playing probably is a bit mean, and one I often hear around here.
as it the case with most analogies, the pyramid analogy is severely flawed, but I do think it makes the one point clearly which is that when you loose a 500k programming job there are more lower paying jobs in the same industry you can fall into, when you lose a 500k sports job you might not have a lower paying job you can fall into because there just aren't that many in the sports industry.
It's interesting to observe that fame (and the money that usually comes with it) seems to follow something like a log scale. People usually don't become gradually more famous in a linear way. They're more likely to spend a few years with 50k listeners and then get a big hit and get 1 million listeners overnight, then the next big jump is 20 million, and so on.
It's possible to be semi-famous and still able to go to the grocery store and pump your own gas without getting recognized. The local sports radio guys don't need an entourage, even if they do get recognized. But as a rising artist, you hit a point where you can no longer go out in public at all. It's really shocking when it happens because it's so abrupt. My dad's famous friend was a regular at a local restaurant and wasn't bothered for a long time, even when his name/face started showing up in the media. Then one day another customer shouted his name and he got mobbed by fans, and he realized he couldn't go out to eat like a normal person anymore. I think Charli crossed that line with the success of her album Brat last year. It's the point where you start to ask yourself if it's really worth it, and maybe consider going full recluse like Thomas Pynchon. (That's not even getting into the online stan culture stuff that Charli talks about in the article.)
> I think Charli crossed that line with the success of her album Brat last year.
In Hollywood, that line gets crossed at a surprisingly low level. I am friends with Josh Sussman, who played Jacob Ben Israel on Glee. I occasionally visit him in LA, and we can’t go anywhere in public without getting constantly stopped by people wanting photos. It’s exhausting.
I didn't watch it myself, but Glee was a very popular show. Since Josh Susman was a recurring character, it's unsurprising that he'd have a large fanbase (especially in LA).
In the words of Adam Ant: it took us 3 years to be famous overnight.
I also heard about Matt Lucas, of Little Britain fame. He was slowly plugging away at it, and was about to give up. At around 30 years old, he teamed up with David Walliams, describing it as the last roll of the die. Their popularity exploded.
Morgan Freeman didn't become famous until he was in his 50's. Someone asked him if he was upset that it took so long. His response was: "No, because it didn't have to happen at all."
It's fascinating to me that her new album's name is "Wuthering Heights", the name of Kate Bush's debut and number 1 single from 1978. Kate Bush is well known (in the circles of people who know about this sort of thing) and as fiercely independent and self-controlled artist. I hope Charlii manages her career and fame as well as Kate has over the decades.
As I understand, Charli’s album is the soundtrack to a movie called Wuthering Heights. Which is loosely based on the 19th century novel of the same name. And that novel was also the inspiration for the Kate Bush song.
The "average" player in one of those sports leagues isn't really a celebrity at the level the article is talking about. Charli XCX's last album was nominated for 11 Grammies and won six of them, and it has the 15th highest aggregate rating from Metacritic of all time. If you're comparing to athletes, this is All-Star roster, potential MVP winning-level performance for at least that season. By no means it's every player who hits 50 home runs in a season is going to be set for life financially, but the chances they're going to struggle are a lot lower than some some random utility infielder or middle reliever.
never heard of them before this HN article lol. the only thing that struck me was no paragraphs in the article, just one giant wall of text. and also how bored id be living that lifestyle (personally)
I was aware of her name, and roughly her genre, but couldn't have named or even recognised a single track of hers.
I looked her up and started listening as I read the article, and the while listening to the two track released so far from her upcoming album I was thinking "this is really good, why haven't I listened to her before?" then I put on her last album Brat, and realised "Oh, right. That's not my style of music. She's never been writing for me, and I know who she is writing for, and I understand why they like her and why she's so popular." And I respect that.
I'll keep an ear out for her new album, and based on what I've heard so far I fully expect to enjoy it, way more than I'm enjoying Brat. I've also added her substack to my rss feeds, no guarantee it'll stay there long term, but I'm at least curious enough to follow along for her next few blogposts.
And there are plenty of people who haven't heard of Aaron Judge or Steph Curry. That doesn't change the fact that they've played at an entirely different level than the overwhelming majority of other athletes playing their sport.
My point wasn't that everyone will recognize them, just that there's a pretty clear difference between the most successful few at the top of their domain and the others who might still be able to make a living doing it but aren't superstar-level compared to their peers, and that's independent of whether every single person knows who they are. The parent comment brought to the idea of average players of the major professional sports leagues, and I felt like that was almost missing the context of this article, which is someone who might be the literally have been the most successful artist of last year, not just an average a professional musician.
I would bet you have encountered a much larger catalog of Charli tracks than you might think. I too was in the same position last year. Then I looked her up and she has actually produced like 30% of the songs played in Urban hat shops, in public places that allow swimming, and in office buildings in the hvac-safe entrance zone between the first and second set of automatic doors.
That just sounds like you're saying the "average" person in all those professions are bad at personal finance. Maybe that's a reflection of society at large. One articles estimates 90% of Americans being in debt[1] so it wouldn't surprise me that this successful subset would fare much better (although I would bet they do when compared to the general population).
Also debt isn't always bad, but most individuals quoted in the study are probably not holding the good type of debt (debt one can easily pay off but doesn't).
> That just sounds like you're saying the "average" person in all those professions are bad at personal finance. Maybe that's a reflection of society at large.
It is, but it's also a reflection of the business of professional sports in America and where most professional athletes come from. Most professional athletes don't come out of a positive financial environment, they mostly come from poor upbringings and neither through family or the education system are they taught basic financial literacy. Professional athletes in the US suffer the same exact problems as lottery winners, for pretty much exactly the same reason.
> Your average NBA, NFL, MLB, NHL athletes are broke 5 years after they are out of the league. Fame, is mostly a curse.
They would also have been broke if they hadn't been athletes. The career doesn't damage their finances. It's excellent for their finances while it lasts, and then they revert to normal. Why would you call that a curse?
The realities are similar to what we are reading in this article. Most of what gets talked about is gross numbers not net. Most of the benefits of the job, are in the journey not the destination - if you're even into that stuff... i.e. having your music impact lives.
I wish sooooo much that people could read these things so when I go to a dinner party or random event, some GenPop person knew that JK Rowling makes billions of dollars but your average published writer loses money publishing a book. Your average NBA, NFL, MLB, NHL athletes are broke 5 years after they are out of the league. Fame, is mostly a curse.
Good on charli xcx for writing this and for writing period.