At the other end of the continuum from scientists and engineers are celebrities and athletes. These are the worst investors of all and famously end up broke, for all the usual clichés:
• Big checks lead to a sense of omnipotence, disconnection from real life
• Grandiose self-importance, impatience with details
• Notoriously short careers
• High divorce rates
• Support for an entourage of hangers-on
• Steep fees at best/exploitation at worst from financial “advisors”
• Obligatory descent into booze, pills, and madness
• Acting as private banker to friends and family
• Entitlement to lifestyle of the rich and famous
• Loads of street smarts but no education in areas where street smarts don’t work, like finance
• Busy being fabulous
• No Plan B
It only takes a few years to dissipate a large fortune. The killer combination is drugs + bad company + corrupt advisors, which seem to travel in packs like feral dogs.
It goes without saying that celebrities and athletes make terrible clients for conscientious financial professionals (but great clients for unscrupulous ones). They usually have no understanding of what is being done on their behalf and so cannot participate intelligently in the kind of collaboration that makes for the best long-term relationship.
While their careers may be low beta, their work is so volatile that a conservative portfolio is frequently indicated as a counterweight. If the sums are staggeringly large, then aggressive investing becomes an option once their lifetime expenses are covered. The drill is to translate their human capital into financial capital on an accelerated schedule via a high savings rate. This rarely happens, because celebrities rationalize their expensive lifestyles as integral to the momentum that keeps the big show going.