3. Money mismanagement
From $2 million bathtub to $100,000 leggings, stars buy a number of outrageous things. Thus, it is no surprise when celebrities declare bankruptcy due to their overspending habits and money mismanagement. Academy Award winner, actor Nicolas Cage, has made some very expensive purchases, including a $300,000 Lamborghini, a $3 million Bahamian island, and a $276,000 dinosaur skull. Because of this, he has experienced numerous tax and real estate problems. Other famous people that have declared bankruptcy due to money mismanagement include singer Toni Braxton, boxer Mike Tyson, NFL players Warren Sapp and Mike Vick, etc.