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Is there anyone who doesn't want to be even a little richer today than they were yesterday? Self-made entrepreneur and “Shark Tank” star Mark Cuban said in an interview with Vanity Fair that getting rich is all relative. He said there are several things one must do to be in a position to become rich.
We rewatched Cuban's video interview to see if his get rich guide, shared circa 2017, still holds true in 2024. Here, Cuban shares his nine rules for getting rich.
1. Live like a student
When you first land a great, well-paying job, it's not uncommon to want to spend more money. Early in his career, Cuban saw cool cars that he wanted, but he was “lucky” to keep driving older cars, he recalled.
People who live like students don't have to live beyond their means. They avoid lifestyle creep, defined as an increase in expenses as income increases. By living like a student and driving a reliable old car instead of spending all your money on a new car, like the Cubans do, you can help meet your short-term and long-term financial goals. You can invest money in achieving it.
2. Don't use credit cards
Cuban personally recalled using his credit card to the point where he was called by debt collectors. If you don't have access to cash, we recommend using a debit card to avoid credit card debt.
3. Save 6 months of income
A general rule of thumb for an emergency fund is to have three to six months worth of savings. However, Cuban recommends that it is better to err on the side of saving more money than less.
No matter what happens to your current employment status, whether you experience a layoff or decide to quit your job, Cuban said you should save at least six months' worth of income.
4. Put your savings in SPX mutual fund
If you don't know what SPX means, it refers to the S&P 500 index. If you've made all of the money transfers listed so far, Cuban recommends investing some of your savings in his SPX mutual fund, which is the cheapest you can find.
5. Invest up to 10% in high-risk investments
If you're a true adventurer, you might put 10% of your money into high-risk investments, Cuban said.
But Cuban added that people who invest in high-risk investments need to pretend they've already lost money. This is why Cuba limits the amount to his 10%.
“It's like collecting art or baseball cards…something has enough value that other people will pay for it,” Cuban said.
6. Buy supplies in bulk and on sale.
If you see a sale on everyday items, stock up. Cuban used the example of a sale on toothpaste, which we all use regularly every day. Mr. Cuban says that if he sees a 50% sale on toothpaste, he should buy two years' worth of toothpaste because it will quickly pay for itself.
“Buy the supplies you need when they're on sale on Amazon,” Cuban said. “Probably the price will go up, but it's a real savings you can put in your pocket.”
7. Negotiate for cash
Cuban says negotiating in cash is a much better way to get a return on your investment.
8. Read a book
Cuban, who likes to visit bookstores and browse, said he reads for hours every day. By doing so, he will have the opportunity to find small ideas that will take him to the next level.
He also believes that money should be spent on books. “If there's something that catches my eye and I think it might give me an idea, he'll give me one idea that will help push me forward and improve my business. Spending $30 was a bargain.”
9. “Nice Works”
Finally, the last rule for Cubans to get rich is to be genuinely kind. When you show compassion and empathy to those around you, you get more results.
“One of the things you can control in life is effort,” Cuban said. “I wish you the best.”
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