People have often been surprised and amazed whenever they have heard the net worth of a particular celebrity. They have wondered how life would be with all that money. People have also wondered where all this money comes from and how the net worth of a celebrity is calculated.
Are you also one of those people who do not really what someone’s net worth being in millions of dollars means? If so, then you are at the right place at the right time. There is nothing wrong with being confused about how a celebrity’s net worth is calculated since many people themselves do not have much of an idea. They often consider the net worth as the income or just the assets of the celebrity. Though, there is more to a net worth statement than just that.
By definition, net worth is the value of a person’s assets from which all the liabilities, such as a mortgage or any types of loans, are subtracted. Now let’s also talk about how celebrities’ net worth is calculated.
How Do Websites Calculate Celebrities Net Worth?
As the definition suggests, to calculate a celebrity’s net worth, agencies have to obtain a celebrity’s full financial report. They have to know the sum of a celebrity’s assets and the sum of all the liabilities. Then, agencies subtract the latter from the former.
Thus, such websites analyze different records of a celebrity’s financial status, such as shares of a stock that the celebrity owns, and the value of assets which includes home, planes, and salary.
This may sound easy here, but it is anything but that. One big problem is that gaining access to a celebrity’s financial information is anything but a piece of cake, even for the agencies of websites, such as Forbes, who are dedicated to finding out a celebrity’s net worth.
No matter how famous a celebrity is, it is impossible to find out how much a person has in their account. Most celebrities also hold their real estate holdings or any other assets under different names, such as under the name of a company or third parties, like family members. Therefore, websites that reveal celebrities’ net worth only have to resort to guesswork to calculate celebrities’ net worth statements.
Other websites, like CelebrityNetWorth.com or CNW, are believed to be using a computer mainframe that runs a program that monitors headlines, art auctions, and real estate sales. The computer, through these programs, then processes all the available data and comes up with a number claimed to be the net worth of a celebrity.
However, this also seems dubious and unlikely as CNW does not have any computer scientists working as staff. Most people believe that there are regular humans behind the net worth statements being revealed about celebrities.
Controversy Regarding Celebrities’ Net Worth
Many people have been actively rejecting the net worth of celebrities being revealed on certain websites, including CelebritiesNetWorth.com. For instance, when Rihanna made in August 2021 because her net worth was revealed by Forbes to be $1.7 billion, articles were being written against the credibility of the revealed net worth statement.
The net worth statement was openly called false. The reasoning given was that for rich people, mostly their shares in companies are recorded and used to determine their net worth. For example, Jeff Bezos owns 10% of Amazon, which would show that his net worth is about $165 million, as of this writing. Even if Jeff Bezos owned any other asset, like luxury houses, cars, boats, or planes, it would not have much of an effect on his net worth.
Though, the same method cannot be used for Rihanna. As is known, most of Rihanna’s wealth comes from Fenty, which is owned by the French luxury conglomerate LMHV. Fenty is not a public company and has not made its financial statements public. Hence, it cannot be known how much money Rihanna makes from Fenty or LMHV.
What Forbes did to calculate Rihanna’s net worth was take into consideration the most recent financial statement made by Fenty, which was in 2018. Using this figure, Forbes might have found a similar company and observed its financial statements.
Eventually, Forbes would have guessed what Fenty’s revenue would be if they went public. This involves a lot of guesswork and leaves a lot of questions unanswered.
Nowadays, celebrities’ net worth revealed by various websites is not considered accurate at all. One has to have extreme credibility and authority at this point to claim to know a celebrity’s accurate net worth. What’s shocking is that most celebrities themselves do not know what their net worth is as they usually hire financial advisors that invest in companies and handle most of the finances for them. What do you think about the credibility of the net worth statements of celebrities being revealed by various websites? Please consider leaving a comment below as I would love to hear your thoughts on the topic.