First part of article is repeat of what we've heard about David...but keep reading for new stuff

http://www.kansascity.com/business/story/762227.html

With fame and fortune come financial challenges
By GENE MEYER
The Kansas City Star

Safeguarding sudden wealth is essential, experts say
You know David Cook’s story. You may even want to live it someday.

But there’s a catch.

Coping with the sudden wealth and fame of an “American Idol” victory may be tougher than you ever dream of, experts say. Handling lightning-strike good fortune often is financially harder than scraping by and daydreaming. Even more common windfalls — a big career leap upward, a sizable inheritance or a gob of lottery winnings — can cause trouble for even the most solidly grounded among us.

When you suddenly have more money than you ever imagined, “living on less than you can, and in this case a lot less, can become very difficult,” said Kevin Taylor, a certified financial planner and investment executive with Oppenheimer & Co. in Kansas City.

There is a solution, though not often the first one that comes to mind in the euphoria of achieving a dream or becoming a pop culture icon.

“Be prepared to put a third of your money or more into something very, very boring,” Taylor said. “You don’t know if you are going to be Carrie Underwood or Taylor Hicks.”

Underwood, winner of the “American Idol” fourth-season competition, went on to become a multiplatinum country recording artist, multiple Grammy winner and, earlier this year, the youngest member of the Grand Ole Opry.

Hicks, who won the following year, released one hit single after that victory, but was released from post-“Idol” recording contracts after sales of his “American Idol” album were disappointing.

Cook’s meteoric rise

No one is predicting how Cook, 25, might handle his suddenly changed circumstances.

The Texas-born, Blue Springs-raised performer has been involved with music from at least age 2.

He formed a band, Axium, in high school, ditched classes in college to perform, and spent much of his senior year trying to launch a solo career.

“I’d never learned so much about myself as a musician as I did that year,” Cook told Rolling Stone magazine earlier this year.

“I was struggling to book shows, struggling to get people to come to the shows, but I loved every second of it,” he said.

Two years ago, he moved to Tulsa after graduating college, joined another group called the Midwest Kings and began scraping by, tending bar and painting apartments while he honed his skills. He resisted pleas from loved ones to come home and get a real job. He said his music “wasn’t something I was ready to give up on.”

Then, one morning last August, Cook, his mother and younger brother, Andy, stood in the rain outside Omaha’s Qwest Center waiting for Andy’s turn to audition for a shot at the “American Idol” television show.

“I was along for moral support,” David Cook has often told interviewers since.

But with the cameras rolling and with Andy’s encouragement, David Cook also auditioned and began a nine-month journey to the pinnacle of “Idol” glory, winning 56 percent of 97.5 million votes cast 13 weeks ago.

Now he’s returning to Kansas City, with 10 other top “Idol” contestants, for two concerts this Friday and Saturday at the downtown Sprint Center. He’s got a recording contract with 19 Entertainment, parent company of the program’s producers, and RCA. There’s also a global endorsement deal with Skechers USA, a footwear chain, and a new SUV and other prizes, all tied to his win.

“Idol” is notoriously secretive about how much winners take home.

Performers reportedly face $5 million fines if details about their compensation or record deals leak to the public. Based on only sketchy information that is available, some trade publications have estimated that winners of the earliest competitions walked away with maybe $750,000 from the show itself and that performers now make in the neighborhood of $5,000 a night appearing in shows like the one coming to Kansas City. “Idol” judge Simon Cowell, in contrast, reportedly is paid $30 million a season for his role in picking contest winners.

Sudden wealth syndrome

Cook couldn’t be reached for this story and 19 Entertainment, headed by “Idol” creator Simon Fuller, declined interview requests. Knowledgeable outsiders, however, say that for all of Cook’s presumed good fortune, the formerly struggling young performer faces some tremendous new challenges.

Many stem from what some call the sudden wealth syndrome — an inclination by even levelheaded people to make astonishingly bad financial decisions when in a flash they become wealthier than they ever imagined. It’s a wider-spread phenomenon than people imagine. Lottery winners, professional athletes, inheritors of property and beneficiaries of life insurance policies face similar challenges.

“It’s very difficult to keep someone grounded who may have been making $30,000 a year and now has $300,000 or even $3 million,” said Peter Shukat, a New York attorney who in more than four decades has represented the estates and families of entertainers as diverse as John Lennon, Barry White and Andy Gibb.

One of a suddenly hot entertainer’s most immediate needs is good, objective advice to help with legal, professional and business decisions that are occurring on levels he or she may never have imagined before. That’s equally true of lottery winners or anyone else who has become very wealthy very quickly, and it can be unexpectedly hard to come by, Shukat said.

“You don’t want someone who’s going to blow smoke” or who may be tempted to put his or her own interests ahead of yours, Shukat continued.

Even trusted family members aren’t always the best sources for this advice, he said.

“They don’t know the business,” Shukat said. And, in the entertainment industry at least, newcomers need all the experienced, objective advice to sift through nuances of recording and management contracts that determine what they do, what they are paid and how much of it they ultimately keep.

There is another potential trap that suddenly wealthy people need to beware of. It’s forgetting that a seemingly endless gush of money really isn’t that, and that nothing lasts forever. The solution is an investment approach that is not often first thought of in connection with rock stars, professional quarterbacks or big lottery winners.

“We treat these clients like they are retired people,” said Joel Huet, the head of Blue Ridge Bank & Trust Co.’s wealth management group.

There are more similarities than might be first imagined, said Huet, whose clients include his brother-in-law, former Backstreet Boys member Kevin Richardson.

Fame, like the ability of professional athletes to negotiate whopping signing bonuses or lottery winners to pick hot tickets, can be fleeting. Those lucky enough to have owned or done those things might, like recent retirees, face long years in which they can still earn money, but not nearly as much.

That isn’t always an easy sell, because many of the people with the ambition, talent and drive required to become superstars tend to be risk takers too, Huet said.

“And if all of a sudden you have $5 million or $10 million, you may not think you have to do the bread-and-butter stuff, like asset allocations and investing in a way that is appropriate for your time horizon.”

No one who suddenly comes into a lot of money is immune from making foolish decisions, said John Christensen, vice president for wealth management at Enterprise Bank & Trust in Kansas City.

Executives reaping big stock options and professionals hitting the top rungs of careers can blow unimaginable sums just as quickly as overnight pop stars, athletes flush with signing bonuses or endorsement deals, lottery winners or anyone else who becomes instantly wealthy, he said.

“It’s easy to spend money as if it will go on forever,” Christensen said. “What you’ve got to do is make sure that your lifestyle doesn’t outpace your wealth.”

Not sure why this was shared on the board; but it is not up to us to make comments. If DC has not commented and 19E has not commented either should we.

I just post what I find to share with others. I don't think any one person can decide what will interest others. This was an article from a Kansas newspaper.

I am not challenging what was posted - I realize that this was from the Kansas City newspaper. Thank you for the FYI.

I think the it was a very good article.

Maybe if you picked out one paragraph to focus on, you might think it was "gossipy" (if thats a real word). But as a whole, this is a very real situation David is in and if nothing else, I believe, is a work of caution to him and others in similar situations.

Personally I don't think we need to worry about this one. Not only is David well grounded. He's smart, and I think he will surround himself with smart people that he can trust. I think he knows that this could all go away as quickly as it came. He doesn't seem to be the type of person who takes anything for granted.

I agree, plus he's got such a close family, I'm sure they'd talk some sense into him.... if by chance he did get out of hand.

Agreed. His family is uber great and will make sure he is OK in all aspects.

Just me, but I'm kinda glad you posted this article. We all care about David, and that includes wanting to see him be successful in his career and in his life for many, many years to come. Yeah, if you take out the one paragraph about how much he 'may' be making now, it's a good, sound article...We all just want the best for him, in all aspects of his life.

Thanks for posting...

PLEASE KNOW THAT I WAS NOT CHALLENGING THE POST.

DAVID IS WELL GROUNDED AND I AM SURE THAT HE HAS OR WILL HAVE ALL THE RIGHT PEOPLE IN PLACE TO HELP HIM MANAGE HIS FINANCIALS. THE ARTICLE OFFERED GOOD SOUND ADVISE.

THANKS FOR BRINGING IT OVER.

I found this article very informative. Thanks so much for posting it. Just because David or his production team didn't contribute to it doesn't mean it is invalid, or critical. This is a subject I find fascinating and like most of you, I have great faith in David's ability to keep his financial feet on the ground. I'm sure his first priorities will involve helping his family out in whatever way he sees fit--and that they accept. He is so mature for his age in every other way, I doubt if he will let this windfall go to his head.

I agree with that. I'm sure that all these changes in his life must be a challenge to get used to. Such a big difference from not too long ago.

Jeannine

Annette, I think you were, in fact, challenging this thread starting post. You said, "Not sure why this was shared on the board; but it is not up to us to make comments. If DC has not commented and 19E has not commented neither should we."

If one is not careful, one can "should" all over oneself.

I think it's a given that the vast majority of posters here absolutely love, love, love David Cook. HoorayDC isn't the first DC fan to wonder, "What in the world is David doing with all that money?!" It's a natural point of curiosity, especially when we all have heard of celebrities who went bankrupt due to lack of skilled handling of their earnings. None of us want that to happen to David; hence, the posting of this very relevant article.

David's mother seems to be the guiding force in that family. She, like David, strikes me as inherently sensible and well-grounded.

i actually think this is a very good article to post here. i have been wondering about this, because if i was bartending and sleeping on friends couches trying to make ends meet and then i have a TON of money all of the sudden this si info he would need to know(which im sure he does) david is very level headed and smart so i think as long as he has teh right people around him he should be fine


AND THANK YOU FOR BRINGING THIS ARTICLE OVER ALOT OF PEOPLE DO WANT TO SEE IT

I for one am over saturated these past 3 or 4 days with posted "reasons to worry about David." I understand Annette's response. I will say that I did find the article interesting, and that "sudden wealth/fame" is a very true syndrome. But if there was EVER anything you and I can't control or should even worry about, this is it! You will drive yourself crazy worrying about these aspects of David's personal life.

That said, I think the challenges brought up in this article are valid, and pose a potentially bigger problem for David than Crush's debut performance, media reports about "Crush," or bad reviews of David in concert. This is the one thing that ALL people need to deal with when good fortune comes their way... lottery winners, celebrities, etc. Remember, I said potentially "bigger problem than..." not that I think this IS a big problem for David.

I think David stands a great chance of navigating all of this successfully. I base this on not only his high level of education, but also that of his entire family's. At least from what I know and have read about them. If he surrounds himself with a good team (business manager, accountants, lawyers, agent) and uses common sense, there's no reason why he shouldn't become a celebrity who manages his money wisely. The good thing is that he doesn't seem to be hung up on material things. That's a huge advangate right there.

We were on such a high following his blog and then Lindsey Rose. The Miami and Eonline articles were such a buzz kill. I personally will only post great reviews and interesting, informative articles on this site. It's a fan site and I don't wish to upset anyone. This article was informative, and I think if we hadn't had such upsetting posts the past couple of days we would be less sensitive to it. I already lashed out at "antares" for posting the Miami article and then apologized this morning. I think another member put me in a lousy mood yesterday with a post that supported a previous attack against David. I was fed up with negativity and took it out on the wrong person. I like to think that's not my style.

Scott, david-scott.org isn't a cult, is it? < teasing >

LOL!!! You know, sometimes I wonder!! I sometimes feel like I drank some "kool aide" and friends of mine definitely think I have!

Hope that wasn't grape kewl aide---you are a laugh riot, Scott!! Luvs ya so much!

Hey, right below this thread, in this forum, is a link to an Oklahoma article. It was also posted in another thread a few days earlier, and you may have read already. David did the interview via phone from Philly. At that time he says they're AHEAD of schedule with the record. Anyways, he speaks about some stuff that's very much related to the discussion in this thread. It kind of shows me he's very aware of his new fame and fortune and trying to stay grounded. Here's a link to the other thread.

http://www.david-cook.org/index.php?showto...mp;#entry361362

Right , right, right...I just saw that awhile ago--DC is so uber smart just like a lot of people in here (I'm not one!) and this just confirms it--DC is the total package--Smart, Sexy, Talented, Humble, Big Hearted---No Worries! THAT is why America voted for him like insane fiends! Winning (as we all know) by 12 mil! Because we knew he was the one! He's got it ALL!!! AND..AHEAD of the schedule!--WOOTS!

SORRY, I won't challenge anyone's post from now on.

I just read that, Scott. and I completely agree with you. A couple of quotes from the OK article stick out to me (I posted this in the other thread, too...but it's also relevant to this discussion):



Sounds to me like he's keeping the "sudden wealth" in good perspective, and I think he has a good enough head on his shoulders and strong enough family support/feedback to keep it that way.

One of my personal observations about life is that the struggle for perspective confronts us daily...relentlessly. In fact, it might be fair to say that life IS the struggle for perspective--in matters big and small. We get bent out of shape about the small stuff, only to realize it's all small stuff. (Someone wrote a best selling book about this, didn't he?)

David appears to be a unique celebrity. He has said more than once that his perspective is tempered by adversity. For example, as he's singing to an AI audience of thousands, his brother is sitting in the audience. Talk about a balanced prism through which to view life! In this way, he's a good role model--which is why we scour the internet searching for his utterances!

Very well said!

Annette, please keep doing exactly what you've been doing everyday on this website. You are responsible, intelligent, witty and a voice of reason here. You have contributed greatly and have helped make this site a wonderful resource for David's fans. I think you and I (and many others) are very sensitve today in the wake of the recent slams against David, coming on the heals David's amazing actions this week (namely his blog & Lindsey Rose). It's natural to get some emotions going at this point.

Thanks Scott for the encouragement and support.

Annette, I agree with you about this particular article. I have no problem with having it posted here since many people seemed to find it informative, but I had the same reaction as you did to it. I actually saw it a couple days ago and chose not to post it here because it didn't really seem that relevant to David to me. It was all generalities about celebrity and new-found money. But like I said, if people find it informative, I have no issue with that. But some of us agree with Annette also. Just sayin'.........

All of this is going to kick us into high gear buying his new single
I'm planning on downloading mine from itunes the minute it's released, then spending 10 or 12 bucks and getting 10 hard copies from a couple of brick-and-morter stores like Barnes & Noble, Borders and Target. Want to make sure the sales count so I'm spreading it out. I'll hand them out to my co-workers as a fun little "gift with an agenda" (they'll all laugh). I have downloaded about 150 singles via itunes over the last 3 or 4 years, but I have never purchased a CD single. Do they really sell them lol? The last hard copy single I bought was a vinyl "45" in 1980... I think it was an ABBA song. I suppose I bought a 12" disco single as late as 1981 (LOL AGAIN!). I suppose I have ecclectic tastes in music! I'm really mostly a rocker though.

Aw Annette, now I feel bad. You and Pam try really had to keep it postitive here, but there are going to be dark days. It's all a part of fandom, we celebrate and then when have to, we worry. People just feel better when they can vent. Sorry we made you feel bad, we know how hard you work.

Yeah, what he said!

Dittos Annette! We need you! Nuts like me need to be helped out once in awhile!!! **LUV YA**

This is true for anyone, as the article says. So aptly written is the writer of the winning ballad, Reggie Hamms - reading his story pretty much sums of the cycle and circle of such circumstances. If you haven't read it - it's worth it.

Having sudden wealth changes your life - no matter how "grounded" you are, it will. Besides, once this is over, as MJ said - it's a lot of pressure to keep up the pace and selling records to the amount of people who have been packed into the concerts. Time will tell, and when you're in the public eye - you no longer have your privacy. Everybody will want to know what kind of car - house - dog - and then there's the girlfriend that has been more than a 50-50 decision on - Not ours to decide - soooooo it goes! My humble comment would be that he stay approachable and keep that sweet spirit about him as he gets the experience in full throttle mode not to forget his surroundings and the people who pushed him there.

Let's just see how his album sounds - and then you can all make decisions to support it or drop it. That's the biz.

I don't think we have anything to worry about eather. BTW I love the quote you used for your sig thats a great quote.

It's probably inevitable that David will become less approachable. Here's what the Beatles said about touring.



On the other hand, David and his yet-unformed band may turn out to be like Bon Jovi--still touring over 25 years later! Wow...that's what I call longevity!

now we can add financial advice to the litany of free advice people want to give david.

I've been a journalist for nearly 20 years, and I've never been fond of articles like this -- it's all speculation and there's no first-hand interview with the subject of the article (David or his record company). I understand that David is unable/unlikely to discuss the details of his financial situation, but it would have been nice to at least have had a general comment from him. A good interviewer/journalist (with persistence) will get a comment. If you look in other articles, David has made reference to his financial state of affairs before American Idol. So why not get a general comment from him for this story about how things are now (e.g., "Yeah, things are pretty good right now," or "No, I can't complain about the money.") Even a short, general comment -- even a witty comment -- would have helped bolster this story.

I've been forced to write articles like this before, and I never cared for it. In my professional opinion, not interviewing the subject of the story and relying on references to other news sources is not credible. While I do agree there's some good general advice in the article, it's all speculation. I think the newspaper was trying for a "fresh" approach to writing about David (since everything's already been written and said about the tour and the upcoming record). Unfortunately, I think the effort failed. The article leaves me empty.

As a writer/producer for local TV news, I agree with you tracig. If you can't get David, either don't do the article, or broaden it out to include other celebrity examples, past and present. But the writer chose to make David the "peg" of the story, and without his participation it's bad journalism, no matter how valid the points are. And as I stated earlier, I do think the points are valid and the "dangers" are real. But that's not the point. I think David was exploited for this article and I guess that's what bothers me. I also have been forced to do this and I hate those assignments. The writer/news outlet should at least hold off until they do have an opportunity to get David's responses. He'll be in town in a few days... I'm sure he'll do press in KC. They could have waited.

I agree with you 100 percent. The story should've been held until David could provide a comment, even if it's just something general.

that bothered me, too.

This article is a huge generalization about people who achieve sudden wealth---it has nothing to do with David specifically.

However, I don't think we have anything to worry about. David is smart, very grounded, realistic and has a good family support system.

Also, he seemed to be struggling with money before he came to AI. Most people in that situation have a greater respect for spending and saving money. When you are struggling to make ends meet and asking friends and family for loans for everyday things, you tend to stop and think before you spend.

David will be fine.

I guess because it's an article from Kansas City David makes the best example of this sudden wealth syndrome. I have an online friend who is going through a spending fury after she became POA for her mom last year... and shows no signs of slowing down. She seems to think it's an endless pool of income out there and I pity the day she comes to the rude awakening that it ain't.

I totally agree with you. I've lost track of how many posts, in threads where we fans worry about this or that, where I end by saying "David will be fine." We have no guarantees in life, but he is just so centered, level headed, well educated and logical... and these important and wonderful qualities seem to run in his family, so he's got great support. If any celebrity stands a chance of navigating all of this successfully, David does.

I think that there will be people around to help him with his finances. There is a good book by Benjamin Frankin called Ways to Weath which is good. Also Oprah Winfrey would be a good model and she is knowledable on how to handle money and may be a good person to consult with if he needs it.

Yes, Oprah Winfrey seems quite knowledgeable and wise about handling money. But unfortunately, I don't think she goes around giving other people financial advice. Perhaps you meant that David should surround himself with good financial planners and advisers, like Oprah obviously has. Plus, Oprah's wealth is on a completely different level than David's is right now. Isn't she one of the wealthiest people in the world?