A common misconception regarding debt problems is that the extravagantly rich we see living lavishly around us couldn’t possibly struggle with debt. How could they? They have so much money.
Luke Hirst MD of debt experts, DebtBusters says, “Don’t be fooled by the shiny cars and huge houses; even the excessively rich can get themselves into debt, and even land up bankrupt. Debt problems stem from certain spending and money habits, as well as a general attitude towards money. If you display these destructive characteristics it doesn’t matter how much money you have, you will find yourself sinking. The difference is that the rich tend to get themselves into larger scale debt as they have more to spend.”
A perfect example of this doesn’t come to us straight from Hollywood, but is on our doorstep.
The luxury home in Greenpoint Cape Town belonging to Michelin Star Chef Conrad Gallagher has been sequestrated. This talented celebrity chef had influence on kitchens such as The Table Bay and The Palace at Sun City, he also had his own television show and opened a lavish restaurant in Cape Town called the Geisha Wok and Noodle Bar.
Looking from the outside in no one would ever have thought that this shining success story could end in auctions, foreclosure and bankruptcy.
According to the facts Gallagher has many creditors including catering companies, doctors, security firms and banks. Owing R1.8 million to Absa Bank and over R300 000 to a Cape Town based catering company.
Staff at his critically acclaimed restaurant the Geisha Wok and Noodle Bar reportedly walked out in the middle of dinner after not being paid for two months. The restaurant closed in August.
His magnificent home on Ocean View Drive now stands empty awaiting the auction that will in turn hopefully pay off most of his creditors anxiously awaiting their money. His home boasts a roof top pool, sauna, kitchenette looking over a lap pool as well as glorious views of Robben Island and the new soccer stadium.
The question on everyone’s mind is how did someone with endless potential and capital available to him land up in over his head with debt? Was he living beyond his means? Did he make some crucially bad financial decisions? Or did he simply think he was financially invincible and could therefore live the way he chose and spend as much as he wanted?
Hirst continues to say,” Every consumer needs to apply certain money management rules and practices to their finances. No matter which income bracket you fall under you need to manage your money effectively or you could land up with serious financial difficulties. Budgeting is an example of a crucially important practice that should take place each and every month. If you do feel that you are slipping or need expert advice, contact a debt management firm for guidance.”
