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We all know by now that even the rich and famous can end up poor and infamous. Indeed, being famous cannot completely guard someone against making poor money decisions. After all, people are people, and some never learn the importance of financial discipline. Many of the richest people fall on hard times by failing to follow the basics of personal finance:

1. Make more than you spend.
2. Avoid getting into more debt than you can handle.
3. Set aside money for a rainy day.

Unfortunately Michael Jackson fell into the category of rich people who do not manage their money very well. He lived a luxurious lifestyle — one that overran his income. It seemed as though someone so rich could never spend more than he earned, but it still happened. He also got into legal trouble, adding further to his expenses. Most people heard about Michael Jackson’s financial troubles nearly two years ago, when the first inkling that his ranch Neverland was going into foreclosure. (The ranch was saved from auction in March 2008 when a wealthy real estate mogul, Thomas Barrack, bought the ranch.) At any rate, it is clear that there are other financial issues to be worked out by Jackson’s estate.

Putting together an estate plan

This sad tale serves as a reminder that it is important to put together an estate plan. Michael Jackson, though a great entertainer and a worldwide icon, did this rather poorly. Tisa Silver, at Bizzia, points out that there are four essential points that good estate planning must cover:

1. Accumulation of wealth.
2. Preservation of that wealth and minimization of costs.
3. Use of your assets if you should become incapacitated.
4. Distribution of the assets after death.

In the end, it is important that you prepare your finances in life and in death. It makes things easier for you and your family in the long run, and protests those you care about.

Today, the main economic data release is U.S. non-farm payrolls data for the month of May. Economists had predicted that the U.S. economy would lose 525,000 jobs last month. However, when the job loss numbers were announced today, they came in at 345,000. This is even lower than the revised 504,000 job losses that came in April. Even though the job losses are still steep (and bring the unemployment rate to 9.4%), the fact that unemployment is slowing is an indication of improvement.

Indeed, with this dramatically lower unemployment number, some economists and analysts are declaring that the recession has come to an end — or at least it will end soon. Speculation that the economy would stop contracting by the 3rd quarter of 2009 is more justified than it has been since such predictions were first made. There is hope that eventually job losses will dwindle and reverse, helping add to an economic recovery that can begin by the first quarter of 2010.

Other information that has indicated that the worst of the recession is over is pending sales data from the U.S. Also, existing home sales are on the rise. Even though foreclosures continue to cause problems in the housing market, home sales are on the rise and may eventually balance things out. Additionally, if the employment situation improves, it is likely that the tide of foreclosures will slow as well. With fewer people losing their jobs, it means that fewer people will be subject to a situation that prevents them from making mortgage payments.

If the indications are correct, and the end of the recession really is imminent, then we have already passed a bottom. This illustrates one of the dangers of trying to time the market, buying at the bottom. Rarely is the bottom recognized until it has passed. Instead, if you are in a good position to invest or buy, and the deals are good, make your move. Even if you aren’t buying at a bottom, you are still getting a good bargain.

It took months and months (and bailout loans for banks and auto makers), but insurers are finally getting access to TARP funds. TARP funds, which were first made available to big banks in order to help them avoid collapse, are now being used as a general sort of backstop for capital. Large insurers are the next group to get access to TARP funds, reports MarketWatch:

Plans that the U.S. government would make up to $22 billion of bailout funds available to some life insurers first appeared in The Wall Stret Journal on Friday.

“Out of the companies mentioned, we suspect that only Hartford and Lincoln would be likely to take TARP capital,” said Thomas Gallagher, analyst at Credit Suisse.

The other four insurers approved for TARP funds include:

1. Allstate
2. Ameriprise
3. Prudential
4. Principal

However, some companies might be reluctant to take TARP funds. It is being seen as a sign of weakness, and there is still an undercurrent of populist rage about TARP and using it to help bailout large companies. At any rate, the news that insurers will have access to TARP funds as an option for capital helped the sector on the stock market. Hartford is gaining on the news, and other insurance companies are seeing stock market success as a result as well.

It will be interesting to see whether the government attempts to attach strings to this money for insurers. Auto makers were required to come up with restructuring plans in order to be eligible for more funds, and the big banks had to undergo stress tests. In any case, if few insurers take advantage of TARP funds, it’s likely to be a moot point.

With the news that the government continues to shore up Wall Street giants, and with recent economic data, it is expected that the recession should come to an end by the end of the year. There are still developments to be awaited — mainly in the housing market — but investors and others are becoming increasing confident, despite misgivings by a few prominent economists.