Losing it all late in life

[Louis Balfour]

Many years ago Karen Millen (of posh frocks fame) was a casual acquaintance. She had started out with £100 and by the time I knew her was living in a big Georgian house near Maidstone, with a number of shops. She went on to expand the business further but ultimately went bankrupt.

Throughout it all, her partner Kevin Stanford was the business brains - she would openly say so. The couple separated, but he went on to other business ventures, for example All Saints was one of his.

However, last year Kevin also went bankrupt at the age of 63 and spent some time at Her Majesty's pleasure, for contempt of court relating to business dealings.

I always admired Karen and Kevin, they we bright lights in Maidstone, which at the time I lived there needed illumination! I, for some reason, always thought of them as being indestructible. The self-starters who made it and stayed ahead.

Though I had not seen them for many years, I was shocked when I heard about Karen, but more so when I heard about Kevin. It's a hell of an age at which to be made bankrupt. Hopefully he was prudent enough to have built up an untouchable pension pot.

But it did rather get me to thinking "If I lost everything now (still in my fifties) what would I do?"

Has anyone here been in in that boat and, if so, what did you do?

[Simpo Two]

I think there's a time when you pack it in and bank the cash.

Or if you have the sort of mind that has to keep setting up businesses, make sure the risk is smaller than your pile of cash.

[GliderRider]

Some people who make a lot and lose it all pick themselves up and do it all over again; hopefully without losing it the second time. Clearly it all takes a lot of energy that they may struggle to find the second time, but at least they know some of the mistakes not to repeat.

[CoolHands]

Have to be pretty dim to not put a couple of million away, and a property or 2 abroad held in trusts or some other untouchable way.

[hidetheelephants]

I imagine it makes a big difference if it's personal or business; a ltd company going tits up shouldn't ruin your life but personal bankruptcy could fk you up quite badly.

[smifffymoto]

I don’t know these two but when I read of Bill Roach(Ken Barlow) going bankrupt a 2nd time ,one wonders if they are batst crazy incompetent or it’s a wealth squirrelling away out of reach from the tax man.

What most surprises me is how us normal folk,living on normal household incomes manage the onslaught day to day.

And survive.

[paddy1970]

In the United Kingdom, when an individual is declared bankrupt, most of their assets can be claimed to pay off debts.

However, pensions are generally protected during bankruptcy. Unless you are of pensionable age (or nearing it), then the trustee handling your bankruptcy has the right to apply for an Income Payments Order (IPO) against your pension. This means you might have to pay a portion of your pension income to your creditors.

[iphonedyou]

Apropos of planning for life after business, I recall reading in the FT Weekend that Aron Gelbard, founder of Blooming Wild, doesn't have a pension. The business is his pension.

https://www.ft.com/content/68cb9c92-cd9b-417e-95d5...

I guess that might be quite common, but it's not without myriad and significant risk I'd have thought.

[Truckosaurus]

iphonedyou said:

...The business is his pension.... it's not without myriad and significant risk I'd have thought.

Indeed. You have to assume it is just some sort of 'flex' to show you are 'all in' on your business.

I suspect the entrepreneurial types who make-it and lose-it are the types that would never retire anyway, so starting over in your fifties/sixties is less of an issue than for those of us wage slaves who are looking forward to retiring if our pension pot ever allows us to.

[Louis Balfour]

Truckosaurus said:

Indeed. You have to assume it is just some sort of 'flex' to show you are 'all in' on your business.

I suspect the entrepreneurial types who make-it and lose-it are the types that would never retire anyway, so starting over in your fifties/sixties is less of an issue than for those of us wage slaves who are looking forward to retiring if our pension pot ever allows us to.

I would like to think of myself as an entrepreneurial type (I was too lazy at school to get a proper job) and I do have a small pension, Even at late 50s I am not sure I could do again what I did previously, and it wasn't anywhere near the scale of what Karen and Kevin did.

[jonsp]

Louis Balfour said:

But it did rather get me to thinking "If I lost everything now (still in my fifties) what would I do?"

Has anyone here been in in that boat and, if so, what did you do?

You survive. For reasons I don't want to get in to (AKA stupidity) ended up homeless. This time last year was in a homeless hostel having been "rescued" from the streets.

The easy answer is you push on, it becomes survival. Now have a business built up from scratch to significant income but don't spend it.

I think this it what soldiers etc call PTSD, you don't mentally deal with problems at the time because you just want to survive. When you have survived the mental problems rear their head.

Getting the money back is fairly easy - you don't become stupid/lose the money value of your skillset when things go wrong. Getting your head back is a lot harder.

[hidetheelephants]

smifffymoto said:

I don’t know these two but when I read of Bill Roach(Ken Barlow) going bankrupt a 2nd time ,one wonders if they are batst crazy incompetent or it’s a wealth squirrelling away out of reach from the tax man.

What most surprises me is how us normal folk,living on normal household incomes manage the onslaught day to day.

And survive.

Actors have erratic income and seem disproportionately prone to being cheated or badly advised by 'business managers' and accountants.

[Simpo Two]

hidetheelephants said:

Actors have erratic income and seem disproportionately prone to being cheated or badly advised by 'business managers' and accountants.

Actors make their money by acting; businessmen make it by running businesses so have a head start about managing money.

[Greshamst]

Louis Balfour said:

Throughout it all, her partner Kevin Stanford was the business brains - she would openly say so. The couple separated, but he went on to other business ventures, for example All Saints was one of his.

However, last year Kevin also went bankrupt at the age of 63 and spent some time at Her Majesty's pleasure, for contempt of court relating to business dealings.

I have a feeling this guys has done a lot of work to have google search results removed.

I googled him, you can find articles about his appeal for early release, but very little news sources on the actual offence and sentencing.

[Louis Balfour]

jonsp said:

Louis Balfour said:

But it did rather get me to thinking "If I lost everything now (still in my fifties) what would I do?"

Has anyone here been in in that boat and, if so, what did you do?

You survive. For reasons I don't want to get in to (AKA stupidity) ended up homeless. This time last year was in a homeless hostel having been "rescued" from the streets.

The easy answer is you push on, it becomes survival. Now have a business built up from scratch to significant income but don't spend it.

I think this it what soldiers etc call PTSD, you don't mentally deal with problems at the time because you just want to survive. When you have survived the mental problems rear their head.

Getting the money back is fairly easy - you don't become stupid/lose the money value of your skillset when things go wrong. Getting your head back is a lot harder.

Good post.

I've lost several businesses in the past and, whilst it was painful, I hope I learned some things that would stand me in good stead if something bad happened today. I would still not want to go broke at my age though.

I wonder whether this was part of the problem for Karen and Kevin. They started Karen Millen when they were about twenty and, as far as I know, never went bust in the early days. Perhaps had they done so they wouldn't have gone pop now.

I know what you mean about surviving. When I lost a business in the GFC I got through it, but felt quite wobbly for a while afterwards.

[dudleybloke]

hidetheelephants said:

smifffymoto said:

I don’t know these two but when I read of Bill Roach(Ken Barlow) going bankrupt a 2nd time ,one wonders if they are batst crazy incompetent or it’s a wealth squirrelling away out of reach from the tax man.

What most surprises me is how us normal folk,living on normal household incomes manage the onslaught day to day.

And survive.

Actors have erratic income and seem disproportionately prone to being cheated or badly advised by 'business managers' and accountants.

But he's been earning far above average wage for decades, he's on 250k a year for working part time.
He tried getting cocky with tax avoidance and it bit him on the arse.
Absolutely no sympathy here.

[QJumper]

Louis Balfour said:

But it did rather get me to thinking "If I lost everything now (still in my fifties) what would I do?"

Has anyone here been in in that boat and, if so, what did you do?

Not been in that boat, but have always considered the possibilty, and so did whatever I could to prevent it. In that regard I've tended to view life like a ladder, where you put the bulk of your effort into climbing it, and a little into insuring that if you fall, the lowest you can drop is still above your starting point.

[UrbanAchiever]

My wife used to be an actor. As a result we know a fair few of them. Most are just about making ends meet as it's a tough line of work to be successful in.

The ones we know who are financially successful and who earn significant sums are generally useless with money. I perceive it being related to the fact that if you are good at acting/are creative, it often means you aren't good with numbers or have the discipline needed. There will of course be exceptions.

[Portia5]

QJumper said:

Louis Balfour said:

But it did rather get me to thinking "If I lost everything now (still in my fifties) what would I do?"

Has anyone here been in in that boat and, if so, what did you do?

Not been in that boat, but have always considered the possibilty, and so did whatever I could to prevent it. In that regard I've tended to view life like a ladder, where you put the bulk of your effort into climbing it, and a little into insuring that if you fall, the lowest you can drop is still above your starting point.

Started one of my best aged 55 at start of GFC. Out in 2015 and wife said 'no more work', plus no more properties.

2021 ban on more properties lifted (oink oink).

Then ex-partner from that GFC biz said 'now exclusion finished let's do it again'. I said 'nope', he said 'well come in once I've got it going' and this very day I'm officially roped in again (albeit doing next to nothing). Early 70's.

Made/built up and spent/squandered large-ish amounts in the past, so restarts are second nature. Don't see me ever squandering back to zero again, tho.

eta: "pension" amounts to 2 x annuities paying just under £800 a year

[UrbanAchiever]

Following on from my post yesterday, my wife tells me just today that one of her high earning actor friends has been the victim of a massive bank fraud. I'm not surprised. This person is clueless. Hope they manage to get their money back.

And I guess the other reflection on actors being terrible with money, all the ones we know get paid gross and rarely put any money aside for tax. That's often the thing that catches them out and sends them into big financial trouble.