In 2010, billionaire entrepreneur and Shark Tank star Mark Cuban shared "The Best Investment Advice You Will Ever Get" on his blog, Maverick. Cuban’s post was a curveball for anyone hoping for some complex financial playbook. His advice? In some cases, doing nothing might be your best move.
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Specifically tailored for those under $100,000 in liquid assets, Cuban's recommendations were refreshingly simple, practical and, frankly, hard to argue with. He argued that following his three-step approach would leave you with a higher net worth after a year than any advice you'd get from brokers or bankers.
Here's the breakdown.
1. Pay Off Debt – Especially Anything Over 5% Interest
Cuban's first rule is about eliminating what's eating your finances: consumer debt. He bluntly said, "If you have any credit card or other type of consumer debt on which you pay 5% or more interest, pay it off. Compound interest is your enemy."
The math is simple – why chase investment returns when the interest on your debt is likely erasing them faster than you can build? Paying off debt offers guaranteed returns in the form of money you're no longer throwing away.
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2. Cash Is King And Sometimes, Doing Nothing Is Best
Cuban stressed the importance of keeping things simple, especially in uncertain times. He used Bernie Madoff – the mastermind behind the largest Ponzi scheme in history – as a prime example of how risky "too-good-to-be-true" investments can be. Cuban warned, "Now that Madoff is in jail, no investment can offer returns with zero risk. If you don't fully understand the risks of an investment you are contemplating, it's OK to do nothing."
His point? Don't let the fear of "missing out" push you into investments you don't understand. Parking your money in the bank might not feel exciting, but it keeps your cash safe and accessible – sometimes the smartest move you can make.
Cuban famously said in a 2018 YouTube video that if you're feeling adventurous, you could invest 10% of your savings in a high-risk investment like Bitcoin and "throw a Hail Mary." However, he emphasized that due to the risk, you have to pretend you already lost it. And if you’re not adventurous or the idea of losing money doesn't sit right – don't risk it.
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3. Use Cash Strategically to Save More
Here's where Cuban got creative: use cash to hold value and actively reduce your costs. He explained it as "transactional returns," meaning the money you save by being a smarter spender can be just as impactful as money you earn from an investment.
"You will get a better return on your money by being a smart shopper and taking advantage of cash, quantity or other types of discounts than you will in the stock market," Cuban wrote.
For example, if you can save 15% by buying items in bulk that you'll use anyway, that's a 15% tax-free return. Compare that to a 15% gain in the market, which comes with fees, taxes and risks and the savings strategy starts to look like a no-brainer.
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Cuban's no-frills advice is rare in a world where financial tips are often wrapped in jargon or complex strategies. He didn't suggest anything revolutionary but focused on the fundamentals most people overlook.
The bottom line? If you have less than $100,000 to invest, skip the hype, pay off your debt, hold your cash if you aren't sure what you're investing in and focus on spending smarter. It's not flashy, but as Cuban pointed out, it's the surest way to grow your net worth. Or, in his exact words: "Your net worth will be higher in one year if you follow this advice than if you follow ANY other investment advice any broker or banker will give you this year."
Cuban's advice is practical, but remember that there are safe and low-risk options, like high-yield savings accounts, CDs or diversified index funds, that can help your money compound over time. Consulting a trusted financial advisor can help you explore these options and determine what works best for your financial goals.
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