Confessions of a Diva: Toni Braxton Reveals Story Behind Bankruptcy Headlines

Nov. 30, 2012— -- "Un-Break My Heart" was everyone's favorite song to listen to while crying over a bad breakup. The year was 1996, and Toni Braxton's power ballad topped the charts, cementing her status as a global superstar. With her deep, brooding voice, Braxton ruled radio and garnered a host of Grammys.

But that was then. Fast forward 15 years and Braxton is now contemplating posing nude for Playboy to help pay the bills.

"There's nothing wrong with doing Playboy," Braxton, 45, said in an interview to air on "20/20" Friday. "The women are beautiful. I thought about it. The money was tempting, but I'm thinking, I have kids, I have a son, I have boys. What are their friends going to say? 'I saw Denim and Diesel's mom's knockers.' That's not a good thing."

So what happened that drove the singer and reality TV star from the highest of highs to bankruptcy? Twice. It turns out Toni Braxton is the poster child of Hollywood's wild rollercoaster – flying high, falling down then bouncing back.

Despite $170 million in worldwide sales, from hits like "Breathe Again" and "Another Sad Love Song," Braxton said she got a measly $1,972 royalty check from her first recording contract. In the music industry, the artist is responsible for paying back the record label for all kinds of costs including: clothes, travel, studio time and music videos.

"What happens is they give you advancement on the next record and then the next record," explained Braxton. "So you kind of stay in debt, in a sense."

That's what she said brought on bankruptcy No. 1 in 1998; that -- and a serious home decor addiction and a bank-busting flatware habit.

"I love dishes and house things, so I kind of lost it a little bit on the houseware," she said about her spending habits, admitting she slightly lost touch with reality.

From plates, to Faberge eggs, and 1,000 thread-count sheets, Braxton indulged in the "girly things."

"That's what I indulged in. I loved that part of it," she said, adding, "I'm a little odd."

Gospel Girl to R&B Diva

Braxton said she's felt odd ever since growing up with a Pentecostal preacher for a father.

"In the neighborhood we were the odd religious kids," she said. "We couldn't celebrate Christmas. … [Music] was not allowed. No secular music. … I couldn't go to the movies -- all these things were considered a sin. I didn't wear pants until I was fourteen years old. …. I had to wear hats. 'A woman should cover her nakedness.'"

Once she became an R&B star, Braxton put her Gospel image behind her and sported risqué red carpet outfits that left little to the imagination.

"I'm comfortable with my inner slut," she said. "The way I dress would be considered provocative, but I enjoy being who I am now. I'm very grateful for my childhood because it helped form who I am today. "

Armed with a new record deal guaranteeing her millions, Braxton successfully emerged from bankruptcy and returned to prominence in 2000, thanks to her hit, "He Wasn't Man Enough"

But the success was short-lived. The songstress tried changing her sound to complete with new and younger stars like Beyonce and Rihanna and her fans weren't buying it. Her next three albums only sold a few hundred thousand copies each.

"Those albums—that's like that one-night stand that you don't want to talk about," she said. "You don't want anyone to know about those records that didn't do well. I had a few of those. Definitely a few."

Can Braxton Come Back From Bankruptcy No. 2?

Despite the bad sales, Braxton took her music directly to fans with a Las Vegas revue show. Eighteen months later, she said she was diagnosed with microvascular angina, a narrowing of vessels in the heart, and later lupus, a hereditary autoimmune disease that killed her uncle.

"The doctors told me I would never be able to perform. They said, one or two songs, here and there, occasionally," she recalled.

The life-threatening diagnosis squashed her self-financed Vegas show and caused her second bankruptcy she claimed. "The Vegas show, I just renewed all my contracts with all my vendors, and then a month later I got sick," she said.

Filing bankruptcy for a second time was difficult for the R&B diva. She felt she had let her fans down.

"Because you're supposed to be smarter. People expect for you to be smarter," Braxton said, adding that she hoped being open about her financial troubles would serve as a cautionary tale for young aspiring singers.

Now, she is doing a reality TV show, "Braxton Family Values" alongside her sisters on WE-TV to tell her side of the story.

"My bankruptcy situation worked out really great for me," she said on an episode of the program.

Indeed it did. A federal court discharged most of Braxton's debt and allowed her to keep her personal possessions including a Porsche, piano and her six Grammys. Though she is now keeps a tighter grip on those Gucci purse-strings.

"I have to monitor myself because I'm definitely on a budget," she joked.

To support her two children, one of whom has autism, Braxton, like many celebrities, has joined the lucrative private performance circuit, singing for adoring audiences overseas.

"The money is lovely. I can't deny the money is yummy," said Braxton, who declined to disclose exactly how much she is paid, but did say she is still immensely popular in Europe.

"I love Russian audiences. They love to be entertained. I don't know if it's the vodka or what, but they love it, and I'm just their girl."

But wherever Braxton goes, she said audiences still want to hear the same old songs. Thankfully, that's not the song she dreads singing the most.

"There are moments that I would choose to exercise not singing ["Breathe Again"], I can't deny it," she said. "Still. I prefer that over 'Un-Break My Heart.'"

At 45, Braxton is determined to make a comeback. She is acting now, starring in the Lifetime movie, "Twist of Faith" as a singer in a church choir.

"I'm slowly getting comfortable in the acting world. It's really nice. I like pretending so it's great," she said of the movie which premiers Feb. 9, 2013. "I think it's important for an artist to graduate and try new things even if it doesn't work. But of course I'm Toni Braxton, the entertainer, the singer. That's my love."

She recently entered the studio to record new music for the first time in years. The first single, "I Heart You" topped the dance charts this summer.

The moral of the story, with a voice like that, she'll always be able to sing her way out of a hole.