Ever since “The Rock” back in the nineties, I’ve been a big fan of Nicolas Cage’s movies (I’m an action movie buff). True… he is the nephew of Francis Ford Coppola so it’s not surprising he “made it” but at the end of the day I think he does a good job in his work. To date he has done over 60 films – now pulling in over $20,000,000 a pop – so how exactly did he get in the financial mess he’s in now?

Mistake #1: Not Knowing Your Money
As the old saying goes “a fool and his money are soon parted.”  You can be a smart person, but if you’re a “fool” when it comes to your money, a disaster is likely sooner or later. While I’m not going to speculate on what exactly did and didn’t happen, what can be said for sure is his money wasn’t not managed properly. Whether it’s his accountant’s fault (like he claims) or Nick’s fault himself (his accountant blames Cage’s “compulsive, self-destructive spending”) we don’t know. But in any case, I think it’s safe to say Cage should have been more hands-on with his money.

Mistake #2: Spending Too Much Income
Like I said, Cage was pulling in $20 million a movie. When you consider that he worked tirelessly and did 2 or 3 a year, that would equal out to be at least $40 to $60 million in revenue. But while the industry pays the A-list big bucks, it also takes a lot from them too…. 10% for agent commission, 15% for talent manager, 5% for publicist, 5% for attorney, and so forth. After that, he’s paying the highest federal tax bracket and state taxes (which are not cheap in California!).

After every one gets their cut, obviously he’s still making an insane amount of money, but is that enough to reportedly have several multi-million dollar mansions, two luxury yachts, a posh Gulfstream 1159A turbojet (which in itself is an estimated $37 million if purchased new), a plethora of high end cars – and last but not least – his very own private island in the Bahamas!

Plus, you have to take into account the upkeep and maintenance on all of the above. Unless you’re making a few hundred million a year, this is living beyond your means! Especially when you consider that in his business, a star can go from making big bucks to nothing at all relatively quickly. No wonder the Nicolas Cage debt story continues to spiral out of control!

Mistake #3: Financial Family Entanglements
For people making as much money as he is, it’s always a good idea to have things in writing with the spouse, or should I say spouses for him! Christina Fulton (who apparently isn’t one of his ex-wives, but rather the mother of his kid) has now filed a lawsuit against Cage for reportedly selling the mansion she lives in. According to her, she alleges that the house was supposedly given to her years ago to raise his child in. In addition, according to her she has $250,000 in unpaid credit card debt (I wonder if her card is an Amex Centurion). Whatever the case, it sounds like things should have been put in clear and concise writing between these parties so this wouldn’t happen.

How do you think your credit habits compare to other Americans? Today CNN.com’s “Quick Vote” question is “Are you leaking cash by carrying credit card debt?” As of right now, 229,380 people responded – nearly a quarter million – and although this poll is not scientific and only covers CNN.com readers, I believe it’s a fair representation of the credit card debt in America. Here is how people responded:

• 50% responded “No I pay my balance monthly”… so half of Americans have zero credit card debt.
• 8% said they do have a balance, but it’s less than $1,000.
• 14% replied say they have a balance of less than $5,000.
• 9% responded they have less than $10,000.
• 20% said their credit card debt is more than $10,000.

Are these figures bad or not? Well of course, less debt the better. But it is important to note that many people today finance “big ticket” items like cars, medical procedures, and others on their credit cards entirely, because they are able to score a lower interest rate than, say, a traditional bank loan like they did in the past. Others merely float debt that they could otherwise pay off, because they have it on a 0% balance transfer credit card… so for strategic purposes they do not pay it off even though they have the money. In those ways, these figures may be inaccurate since they are including quasi auto loans, home renovations, and more which are on credit cards.

Whatever the case, one thing is for sure and that is that the above numbers are another example of how the working middle class is being squeezed, and often find the need to resort to credit to pick up the slack.