Want to take any advice on money or personal finance? Get the Mark Cuban’s Best Advice On Money. Mark Cuban sold his first startup to CompuServe in 1990 for $6 Million. Then in 1999, he sold his second startup to Yahoo for $5.9 Million. His trait of acquiring small businesses and expanding them and then selling them made him owner of $5 Billion. So here’s Mark Cuban advice on Money:
Firstly pay off all your debt:
Mark Cuban’s best advice is, “The best investment you can make is paying off your credit cards, paying off whatever debt you have.” He further says, “if you have student loan with 7% interest rate, if you pay off that loan, you are making7%, that’s your immediate return, which is lot more safer than picking a stock, or trying to pick real estate.”
So the very first win is in paying off all your liabilities as soon as possible.
Save Six months of Income:
After paying all off your debts, next step is to save. But to what extent? At least save six months of income. He says, “if you don’t like your job at some point or you get fired or you have to move or something goes wrong, you’re going to need at least six months of income, so better to prepare for it now!”
Make 10% of the investments in risky avenues:
Mark Cuban’s best advice says that make investments after doing all the above steps. Investments should be categorized by the investor as: Non-Risky, Semi-Risky and Risky investments. And it’s totally fine to invest 10% in the risky avenues.
Self-made millionaires and billionaires take calculated risk and don’t put all their eggs in one basket. He says, “if you’re true adventurer and you really want to throw the hail mary, you might take 10% and put it in bitcoin or ethereum.”
But what to do with other 90%? Put this money in the cheapest fund tied to S&P 500.
Shop for discounts:
You may think that is this advice is for personal finance? But don’t get shocked because it is, the best advice so far. Cuban says,” it’s tough to make a high rate of return in today’s investments climate, so you could be better off, say buying two years’ worth of toothpaste if you want to find it at 50 % off! Saving 15% on $1000 worth of items you know will absolutely spend money on is a better return on your money than making 15% in a year on a $1000 investment, because you don’t pay taxes on it.”