Many who file for bankruptcy know that they are doing the right thing, but they likely still have mixed emotions about it. Nevertheless, they are hardly alone -- there were 767,721 bankruptcies filed by non-businesses in 2017.
While there have been many average Americans caught up in debt, often for taking risks to accomplish great things or facing unforeseen challenges, we thought it would inspire to see a list published by Forbes of the people who have not only survived bankruptcy but went on to flourish.
Nine worth noting
Some common themes here are financial mismanagement and a strong drive to succeed.
- Abraham Lincoln: While there was no law for voluntary bankruptcy until 1841, Lincoln was in his 20s when he and a business partner opened a general store that did not do well. Lincoln left the business, but the partner died, leaving Lincoln to pay back the equivalent of $28,000. This adversity pushed him into politics after getting his law degree.
- Dave Ramsey: After filing, he went on to become a radio personality (with 8.5 million listeners) and author of Financial Peace.
- MC Hammer: This entertainer had one of the biggest hits of the ‘80s, but he spent too much on luxury goods and supporting family members. He filed Chapter 11 when he was $13 million in debt, and then the IRS sued him. He has made good on all his debts.
- Walt Disney: Disney filed for bankruptcy for an early business and was on the verge of doing it again several times before the breakout success of Snow White and the Seven Dwarfs.
- P.T. Barnum: Barnum purchased Scudder’s American Museum in New York, which burned down five times. The business was a success, but Barnum overreached on the scale of the fifth version, causing him to file bankruptcy. It was not until he was age 64 that he created the famous circus.
- George Foreman: Foreman was a world champion boxer before he retired to become a minister, but the lack of income led to bankruptcy in 1983. His second act included returning to boxing and becoming an entrepreneur – 100 million George Foreman grills have been sold.
- Cindy Lauper: She filed bankruptcy in 1981, well before her breakout 1983 album and ongoing career.
- Elton John: This piano man has done so many things, one is filing bankruptcy in 2002 after going on a two-year spending spree of an estimated $1.5 million per month. He is now worth an estimated $450 million.
- Willie Nelson: Our neighbor never filed bankruptcy, but the IRS claimed he owed back taxes of $32 million. This was due to poor management (the IRS reduced it to $16 million, and then he litigated with his old accounting firm). Nelson released an album with all proceeds going to the IRS. He also ended up selling many of his possessions before the final settlement. He is now worth an estimated $15 million.