Justin Bieber, Financial Adviser?

By Chuck Jaffe, MarketWatch

First, Justin Bieber was named Best Celebrity Financial Strategist of 2012.

Then came the announcement that pop star Bieber was promoting a new prepaid debt card in partnership with BillMyParents.com which claims to be promoting responsible teen spending habits and that he would use his social-media power of 48 million Facebook fans and 30 million Tiwtter followers to promote it.

Baby, baby, baby oooh.

Reuters

Its not the first or worst case of a celebrity endorsing a financial product, but it illustrates the disconnect between fame and financial acumen as well as any. And while these deals are increasingly common, the hope is that the public recognizes that celebrities are not financial role models.

Sure, Justin Bieber now has a net worth in excess of $110 million, according to most sources, having grossed about that much in the last two years alone, and GoBankingRates.com gave him their best strategist prize on the basis of an analysis of his published comments and visible habits. But the truth is that though Bieber is known for being in-touch with his fan base, he could not be more removed financially from the world of the kids the card is targeting.

Clearly, Bieber needs a prepaid debit card like a moose needs a hat rack. The sponsor of the card, after all, is BillMyParents.com something Bieber probably hasnt done since puberty.

To borrow from F. Scott Fitzgerald, Let me tell you about the very rich. They are different from you and me. In spite of all of his efforts to interact with his fan base, heres how different Bieber is from his Facebook and Twitter followers.

At over $50 mi! llion a year in income, a $250,000 house would make less impact on Biebers finances than the cost of two tickets to one of his concerts would to the median American, whose income is just over $26,000. According to a variety of helpful sites that calculate this feels like effect, dropping a quarter-million would feel to Bieber like the median American feels when spending about 130 bucks.

Now make Bieber a bit more like the teenager he is, and consider that to him, buying a $425 smart phone would feel like spending two bits, and a top-of-the-line laptop would seem to him like, maybe, 50 cents.

That, by itself, doesnt make his debit card a bad deal. In fact, compared to others and especially bad deals like the short-lived Kardashian Kard terms on the Bieber prepaid debt card arent terrible. The monthly fee of $3.95 is kind-of high, but the loading charges ($2.95 from a debit or credit card, $0.75 from a checking or savings account) are in line with the industry, and most of the other fees (50 cents per balance inquiry at an ATM, $1.50 per withdrawal, an inactivity fee of $3 if the card goes unused for 90 days, and more) are at or slightly above industry norms.

Theres the very real potential for Biebers card to be gone soon, which would be good for the world but not great for anyone who plunks down cash to get involved. Biebers buddy Usher had a prepaid MasterCard deal and some gift-card promotions with Visa that have all vaporized; the Kardashian Kard was killed off once those publicity hogs realized that they were aiding and abetting a consumer rip-off, and cards from Russell Simmons, Magic Johnson and others have all fizzled.

The real ! problem i! s that while finances are highly personal, celebrity is completely impersonal and these cards send completely the wrong message.

Want to teach children about financial responsibility while monitoring their spending and more? Fine, a prepaid debit card might do it, but the celebrity tie-in encourages the child to pull out the card and use it as much as possible, so that they get the perceived social status that comes with the card.

Go old-school for a moment and think back to the days when an American Express gold card conveyed a certain message; that message was sent by using the card, not by keeping it hidden in your wallet.

The whole point for the card issuers at least of issuing a Bieber card is that kids will want to show it off by using it.

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The responsible lesson involves using the card appropriately, and as little as possible without the means to replenish the supporting funds.

When Suze Orman issued her Approved Card in 2012 and her celebrity is not so great that anyone would have felt that using the card was a conversation piece -- whether it was a reasonable card for someone to use depended entirely on the intended users habits. See Suze Orman debit card raises many doubts

Theres no personalization or tailoring when celebrity endorsement is involved. Instead, its all schlock and marketing.

Consumers need to see through celebrity for whats happening behind it. In this case, thats not a statement on Bieber so much as the prepaid debit-card business. Prepaid cards have virtually no! regulati! ons and consumer protections though that may be changing -- and banks feeling the financial pinch elsewhere know they can squeeze out healthy margins in a business expected to surpass $100 billion this year.

Plain and simple, if you allow celebrity to influence your personal financial decisions, youre being a patsy for the banks and institutions.

That knowledge should have you singing Biebers tune, without ever falling for his card.

Baby, baby, baby nooo.

Chuck Jaffe is a senior MarketWatch columnist. His work appears in many U.S. newspapers. Follow him on Twitter @MKTWJaffe.