Baywatch actor talking down net worth on the verge of a new movie probably won’t convince the court, but it’s probably the last chance he’ll get to make his case.
David Hasselhoff has a problem. After four decades of TV stardom, he’d like to retire and live on the evidently considerable residual checks. Unfortunately, court-ordered alimony is a drag. He claims that he’s only got $4,000 in cash to make his monthly $21,000 payments to ex-wife Pamela Bach. She fires back that he’s got $100 million squirreled away. If his situation were as simple as a Hollywood has-been running out of money, he’d have a pretty good case. But when his own filings concede that he’s taking in $1.3 million a year appearing in reality TV and raking in hefty Baywatch royalties, it’s a little tricky to begrudge Pamela what might at most be a third of his post-tax income. In that light, it looks less like desperation than an urge to fight the divorce again. At this stage in his career cycle, that may not actually be a great idea. “Material, involuntary and permanent” When Hasselhoff filed for divorce in 2006, he was arguably semi-retired already. The last “classic” permutation of Baywatch ran its final episode in 2000. After that, he showed up here and there, mostly lending his cult celebrity to joke cameo roles. That was evidently all he needed. He owned 25% of the extremely lucrative global syndication rights to the beach show, so the cash kept flowing through the DVD era. And by the time the divorce was final, he’d discovered reality television, pursuing a three-year stint judging “America’s Got Talent” and paving the way for his own show in the UK. As a result, nobody argued that the money wasn’t there when he agreed to pay $21,000 a month in alimony. But that cycle demonstrates that once you’re a star, the work never really dries up – provided that you’re motivated enough to keep working. Charlie Sheen has big spousal bills to pay. He keeps working to pay them. Mickey Rooney was famously married eight times and the show went on until he died deep into his 90s. Examples like these pose a problem for Hasselhoff because to get your spousal support payments lowered you generally need to prove that you’re facing a material, involuntary and permanent income decline. He can claim all he likes that residuals from the Baywatch franchise are drying up and are never coming back, but if he starts turning down the joke roles, that’s a voluntary decision. We’re talking about a man whose latest TV show may still get renewed for a third season on both sides of the Atlantic. And on that level, it’s going to be tough to get his $21,000-a-month commitment modified no matter how low he’s let his bank balance drop or how fast his credit card debt has ballooned. After all, whether Hasselhoff can dictate his career choices or not, his financial arrangements and his expenses are firmly under his control. Big assets behind the complaints Like it or not, Hasselhoff’s own estimates indicate that he’s got a net $1.8 million in tangible assets – the mansion, cars and luxury goods – to liquidate if he wants to stop working and the Baywatch money drops instantly to zero. Since he’s scoffed at the idea of saving for retirement in the past, those assets represent his nest egg, the wealth he can live on in the golden years. Of course the Baywatch money doesn’t exactly seem to have stopped. It’s a big factor in what Hasselhoff concedes is a healthy $112,000 per month in income right now, and with a new movie coming up, the property could actually be due a renaissance. Even if he pays around 40% tax on that cash flow, he’s still got $67,000 a month to play with. Right now, he says he needs practically all of that money to support his lifestyle and his two adult daughters, so there isn’t any left for Pamela. The thought of scaling back evidently has yet to occur to him. Maybe the judge will suggest it. The daughters can theoretically get jobs, but since their child support was only $2,000 apiece when they were younger, it’s an open question just how large their drag on the family budget is now. Otherwise, while Pamela may or may not need $21,000 a month to live comfortably, that’s what the divorce papers guarantee her. As long as Hasselhoff has the cash, it’s hers. While he can’t control that recurring expense, he’s in charge of every other aspect of how his household runs. Even in Hollywood, that generally means either working or scaling back until the math works out. In the meantime, he seems to have run the bank accounts down and racked up $100,000 in credit card debt. Cosmetically he looks close to insolvent. If he is, he might need serious help to rein in his finances. Bankruptcy won’t help As it is, he can’t even file for bankruptcy protection. In his ZIP code, Chapter 7 is off the table for single guys who earn more than $50,000 a year. Hasselhoff clears that much money every two weeks. And besides, bankruptcy would only clear the personal debt – the spousal obligations continue unless he can make a separate and convincing case that the money is permanently gone through no fault of his own. A newly created asset protection trust isn’t going to help him either because the timeline doesn’t add up: if he set it up well in advance of the divorce, then he paid Pamela $2 million over the years for nothing. Otherwise, transferring his wealth into trust now isn’t exactly going to shield him against long-established claims. I’m not denying that he’s in as much financial trouble as he claims. His mansion is for sale and for all any of us know, the value of 25% of Baywatch has truly dropped to zero. Maybe he’s squandered all this assets and is living on fumes now. But with the new movie coming out soon, the timing is suspicious. Hasselhoff has a track record of thinking about the money at the very last minute. He initially got into this situation because he didn’t ask Pamela to sign a surprise prenuptial agreement until a half hour before the wedding, by which point the arrangement looked too much like duress to hold up in court. The time to hide the assets and plead poverty was likewise years ago. In the here and now, the franchise he co-owns actually has its best shot at a revival in years. He’s working a lot more than he was a decade ago. If he truly can’t make the alimony payments that apparently passed without comment back then, something has gone seriously wrong with his cash flow. In that scenario, the judge will be lenient. From what we know now, it’s far from a sure thing.