Editor’s note: This article is the first in a five-part series featuring the best advice about money from investing greats, renowned economists, top financial planners and other experts. Other articles focus on advice about saving and investing, retirement planning, family finance and the best advice experts have gotten from their moms and dads.
Financial advice is everywhere these days. In the digital age, you can find insights and tips about how best to save, invest and manage your money from adviser and financial services websites; YouTube, TikTok and other social media platforms; podcasts, newsletters and Substacks; and your 401(k) provider, among other outlets.
Then there are all the traditional sources, such as your financial planner, newspapers and magazines, and even your dear Uncle Lou, who always has a money tip or two to dispense. (Yes, despite all the new founts of financial wisdom, Americans are still more likely to turn to family and friends for money advice than any other resource, a recent Gallup survey found.)
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The challenge, of course, is figuring out whether any of the many financial recommendations you come across are actually the very best advice you could get for your circumstances — guidance that will not only help you manage your money wisely but also provide perspective to keep you grounded, whatever opportunities, obstacles or challenges life throws your way.
That’s why we asked a diverse group of 35 top financial experts — acclaimed investors, advisers, money managers, economists, influencers and more — to share their very best advice with Kiplinger readers. The essential question we put to them: Of all the many recommendations or insights about money you’ve given or received, what are the best, most meaningful or most impactful tips you want to pass along?
Their answers include not just practical suggestions on how to save, spend, invest and manage your money, but also insights that help put money and how we feel about it in perspective. We hope you find their responses as smart and useful — and, at times, surprising, moving and funny — as we did.
This first part in the five-part series features general advice about managing money, including how to spend wisely. Coming up: advice about saving and investing, retirement planning, family finance and the best advice our experts have gotten from their moms and dads.
The best advice about managing money
Stick with the basics.
“There’s no shortcut or hack, no easy button, no Amazon for your money that’s going to show up on your porch on Tuesday. You’ve got to do the work and do the journey: Live on less than you make. Invest regularly. Stay out of debt. It’s hard — that’s the bad news. The good news is that 100% of the time, it works.”
—Dave Ramsey, founder and CEO of Ramsey Solutions, cohost of “The Ramsey Show,” and author of The Total Money Makeover and other books
Be your own best advocate.
“You don’t get what you deserve, you get what you negotiate. I’m not sure who told me this or where I heard it, but this insight has been living rent-free in my head for the past 25 years. It has led me to never assume I’m just going to be handed a raise, a financial break or a career opportunity. You have to work for it, be strategic and be your biggest advocate. It won’t always work, but you greatly increase your chances of success.” —Farnoosh Torabi, host of the So Money podcast and author of the book A Healthy State of Panic
Get help, when and as you need it.
“Money is a team sport. Many people think they have to navigate their finances all by themselves, or magically know everything just because they’re an adult. The older I’ve gotten, the more I realize there’s no way I can possibly know everything. So I ask a tax person about taxes—just like if I had something wrong with my eyes, I would go to an ophthalmologist.” —Tiffany Aliche, founder of The Budgetnista, a personal finance education company, and author of Get Good With Money
Even “good” debt can be bad.
“Be wary about taking on debt, even so-called ‘good debt.’ It’s a slow killer of financial dreams. Everyone talks about mortgages and student loans like they’re investments in your future, but any debt becomes bad debt when it’s excessive or you don’t have a clear payoff strategy.”
—Lynnette Khalfani-Cox, known as The Money Coach, is the author of Bounce Back: The Ultimate Guide to Financial Resilience and founder of the Financial Influencer Network
(Image credit: Getty Images)
Let your values be your guide.
“Align your life and money so your money has assignments. Do the mindful work of discovering what you value most, then be intentional, strategic and systematic about where your money goes. You end up investing in more than markets, but also in meaning. When you manage your money holistically with your life, you stick to a financial life plan that helps you flourish.”
—Dr. Preston Cherry, certified financial planner and founder, Concurrent Wealth Management; author of Wealth in the Key of Life
Think about the broad impact when you make money decisions.
“Think of money as a tool to invest in all aspects of your life. Financial planning is not just about numbers in your investment portfolio. It’s also about your relationships, your health, or even your ability to hire tutors for your kids. Bring financial decisions down to the level of how they will impact your everyday personal life, and use money as a tool to create a better quality of life.”
—Louis Barajas, CFP, and cofounder and CEO of International Private Wealth Advisors; author of My Street Money
Look past the math.
“Sometimes I hear advice dispensed that makes good financial sense but doesn’t really consider a person’s peace of mind. For instance: Don’t pay off your mortgage early; if you can earn a higher rate of return on your money, then use it to invest instead. I completely understand the math behind that, but what people underestimate when dispensing that sort of one-size-fits-all wisdom is the peace-of-mind benefits people gain from being debt-free.”
—Christine Benz, director of personal finance and retirement planning for Morningstar and author of How to Retire
Make good habits automatic.
“People give too much advice, like telling people to spend less, that relies on motivation and has a negative connotation, like you are somehow the problem. I prefer to create automatic systems so that doing the right thing with your money is the default. For example, my entire paycheck does not go directly to my checking account; I’ve signed up in advance to parse money out to my different accounts for retirement, my emergency fund and paying my bills. Then the balance goes into my checking account.”
—Megan McCoy, certified financial therapist and acting personal financial planning program chair, Kansas State University
(Image credit: Getty Images)
Marry wisely.
“This is unconventional, but my best advice is to pick the right life partner. That’s a decision you have to live with for the vast majority of your life, and you’re financially tied to that person. That person could be your biggest cheerleader, or they could hold you back. Choosing that person has a cascading effect over the rest of your life. If your partner is smart and savvy, you can hit your goals faster as a duo. But if they don’t respect their own finances, you’re going to have to climb twice as hard.”
—Vivian Tu, author, founder and CEO of Your Rich BFF and chief of financial empowerment at SoFi
Let AI give you a second opinion.
“It’s so much easier today to get a good review of a concept or idea through AI tools and other searches. Many people ask their friends or family for advice, and while AI tools can be wrong, so can your family. And I would bet that the AI tool is going to generally provide a more unbiased perspective of what you should be doing. I don’t view it as a replacement for a formal adviser, but it can provide second opinions.”
—David Blanchett, head of retirement research for Prudential Financial
Don’t let money alone be your guide.
“This advice was given to me by Ariel Investments founder John Rogers. He said, ‘Don’t make big important life decisions based on money.’ People do this all the time, and they make the wrong decision. A simple example is the number of times I’ve seen people leave a job for a few thousand dollars more, for a position that is not as promising an opportunity. That advice has been a guiding light for me. It’s about putting money in its proper context.”
—Mellody Hobson, co-CEO and president, Ariel Investments
(Image credit: Getty Images)
Don’t be your own worst enemy.
“Most of the money mistakes I’ve made have come from overreliance on self-information without professional guidance, overconfidence or under-application of action through avoidance. Financial missteps and internal shortcomings are often aligned. That’s why consistent self-audits matter. When you’re willing to examine your behavior, collaborate with money professionals, and stay open to change, you’re far better positioned to avoid or heal the effects of bad money advice. Your money, psychology and financial planning are partners.”
—Preston Cherry
Don’t let debt stop you from saving.
“The idea that you have to pay down your debts first before you can save and invest bothers me. I understand it’s about playing the interest rate hierarchy. And, if you’re paying a 25% interest rate on credit card debt, you definitely want to work on that. But taking advantage of a 401(k) match, could result in a 50% return. So I think you have to try to figure out how to do two things at once.”
—Jean Chatzky, CEO and cofounder of HerMoney Media, host of the HerMoney podcast and author of How to Money
Get qualified financial help.
“It makes my skin crawl when I ask someone if they have a financial adviser and they say something like: “Yeah, I got a guy. My brother-in-law told me about him.” Your family and friends are often the worst place to get financial advice. Instead, find a qualified, fee-only, fiduciary adviser through the National Association of Personal Financial Advisors’s database at napfa.org/find-an-advisor.”
—Teresa Ghilarducci, labor economist and retirement security expert, professor at The New School and author of How to Retire with Enough Money, among other books
The best advice about spending
Understand how and why you spend money.
“The most important factor in financial independence isn’t how much you have, it’s how much you spend. Someone who spends $60,000 a year needs to save a heck of a lot less to support their lifestyle than someone who spends $200,000 a year. If you don’t understand how you spend money and what’s important to you, then you’re rudderless when it’s time to live on your money in retirement, which makes it much easier to run out of money. Understanding what your needs are and making sure you have enough saved for them also gives you an idea how much extra you have for fun things. And, if the world falls apart, we have a big recession or market downturn, you know where to cut back to make it through that time.” —Carolyn McClanahan, CFP and founder of Life Planning Partners
Spend less than you make.
“You need to spend less than you make, because if you can’t do that, then nothing else works. You won’t have enough to save or invest. You won’t be able to bail yourself out of a jam. Everything else financially falls apart without doing this.”
—Jean Chatzky
Spend now on what matters most.
“The point of money is not to save it. It’s to use it to live a rich life. Of course, we need to automatically save and invest. But we also need to develop the skill of spending money meaningfully. You do not want to end up as someone who spent 60 years solely honing your frugality muscle, and now you’re unable to spend on the things you love.”
—Ramit Sethi, author of I Will Teach You To Be Rich; host of the Netflix series How to Get Rich and the podcast Money For Couples
(Image credit: Getty Images)
Only spend “sure” money.
“Figure out a spending path that’s sustainable, based on highly conservative returns and assumptions. In other words, think like a squirrel who doesn’t want to run out of acorns. So plan like an economist: Do cautious lifetime budgeting, and spend only what you are sure you can keep spending.” —Laurence Kotlikoff, professor of economics, Boston University, and founder and president of MaxiFi, a personal financial planning software company
Live below your means.
“Whether a client has millions in net worth or very little, my advice is the same: Have the courage to live below your means in a society that’s constantly judging your success based on outward appearances. Even clients who make millions might be living paycheck to paycheck because they bought too much house or car and are trying to keep up with everybody else. It’s a never-ending game.”
—Valerie Rivera, a CFP and founder of the advisory firm FirstGen Wealth
Keep your overhead low.
“The best financial advice I received came from two books I read in college. The Only Investment Guide You’ll Ever Need taught me that saving money on the consumables that I regularly bought could get me a greater return on my money than investing in stocks. If the toothpaste, soap, garbage bags, etc. are purchased 50% lower than what I had been paying, buy as much as I can store in my little apartment. The cash I saved is real. And Cashing in on the American Dream: How to Retire at 35 taught me that if I live like a student and find things I love to do that don’t cost money, I can live an enjoyable life with far less stress.”
—Mark Cuban, entrepreneur and former shark on the show Shark Tank
Consider total costs.
“Too often when people buy things, they think just about the monthly payment, but you have to think about the bigger picture, about the total affordability. Like with a car, you have to consider maintenance, car insurance, gas, not just the car loan’s monthly payment.”
—Marguerita Cheng, CFP and CEO of Blue Ocean Global Wealth
Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.