Okay folks, step into my office, I’m glad you’re here. I’ve been meaning to have this discussion with you.
I’ve been summoned here to help you learn how to work smart, play hard and live your best life. Said differently, Big Chips is about how to get, keep, and grow your cheese so you can live the kind of lifestyle that you want to live. Is that not why we came, if not then why bother? (Sorry, but I can’t quit bangin that Mr. Carter joint.) First, though, we need to get on the same, er, page. I know, technically if you are reading this we are on the same page. But you know what I mean Mr. Condescending Magazine Reader.
It’s been said that too often we “buy things we don’t need, with money we don’t have, to impress people we don’t like.” That wouldn’t be so bad if it wasn’t for the “money we don’t have part.” Weezy said “it’s not trickin’ if you’ve got it”, not “it’s not trickin’ if you can borrow it and pay it back with interest and fees over time!” I know that we all want to pop a few bottles every now and then, but if you can’t pull a Randy Moss [“Straight cash homie”], it might not be the best idea.
Sure, this article shares its title with a song about ballin’ out of control made by Kells and Hov prior to the whole “bodyguard-sprays-R. Kelly-with-mace” incident. But don’t get it twisted, Jay and “R-uh” didn’t always have those flashy items that they describe to you in vivid detail in their songs. And trying to emulate them can get you a one way ticket back to your momma’s couch quicker than you can say Stanley Burrell. Case in point: Scott Storch.
Many people don’t realize that Scott Storch was actually a founding member of the Roots. He produced one of their first major hits, “You Got Me” which featured Erykah Badu and used the notoriety from that song [it eventually won a Grammy] to catapult his career as a highly respected hip hop producer. After leaving the Roots, however, Storch was broke for a number of years while he hustled to make a name for himself.
Fast forward to the new millennium and you will recognize him for producing hits like Lean Back (Terror Squad), Candy Shop (Fiddy), and Naugty Girl (Beyonce featuring Sean Paul). In 2000, he was able to buy his first Ferrari. Then as more hits came, so came the rings, the chains, the $10.5 million mansion in Miami, and of course the cars. Oh, those cars. Nothing says “Hey world, stay tuned…I’ll be broke as a joke right after these messages” like buying a bunch of cars that are really expensive, yet depreciate in value in the same way that a Hyundai Accent [my first car, by the way] does. Okay, perhaps that is a bit of an exaggeration, but the $1.7 million that he spent on his Bugatti Veyron seems to be a bit over-the-top even for someone who made an estimated $70 millon making beats. Can you imagine the insurance premium on a $1.7 million car?
Apparently Storch couldn’t imagine it either. Or the taxes he’d have to pay on his $10 million home. Or the pain that occurs at the pump when gas prices hit $4.50 and you need to fuel up the 117 foot yacht for a quick trip down South Beach. What isn’t imaginary is the unpaid $500,000 real estate tax bill he currently has or the outstanding warrant for his arrest for failure to show up to a child support case. Or the embarrassment of having to put your 117 foot yacht up for sale on eBay because of your reckless mismanagement of your fortune. Perhaps he could start saving a ton of money by switching to Geico, but this case might be too much even for the beloved Gecko. B.I.G was right, Mo Money, Mo Problems!
It remains to be seen if/when/how he pulls himself out of this financial mess. With his unquestionable talent, I would be willing to bet that he will be back making hits and charging $100,000 per track in no time. Until then class, what can we learn from Scott Storch? Well, I think there are three important lessons we can take away as it relates to you and your paper:
Getting it: There are many ways to be successful. Scott Storch dropped out of high school in the 9th grade and made $70 million. Tons of people with much more education won’t make that much in their lifetime. Find out what you can be the best at and shoot for it relentlessly.
Keeping it: Hey, I don’t want to wait until I am 60 years old to have fun either, but let’s be responsible about it. Reward yourself when you accomplish something special, but also make sure you are prepared for a rainy day. When it rains, it pours. Understand how much it really costs to live your lifestyle.
Growing it: Save a significant portion of your earnings and invest in assets that appreciate. If you know you have a spending problem, find someone that you trust who will slap the sense back into you when you get out of hand.
There is a lot of world out there. With a little patience, perseverance and planning we can go out there and take what is rightfully ours.
Rob Wilson is a financial advisor at a major national financial services company. Don’t worry, it’s one of the firms that hasn’t suffered a catastrophic bankruptcy in the last few months. He can be reached at bigchipsblog@gmail.com with your financial questions and comments.