The Best Money Advice We’ve Ever Overheard

Listen up! These golden nuggets will be your ticket to success


Men's Health |

Who needs an MBA? For the real secrets of financial success, just listen up at parties, restaurants and even barbershops.

He’s a multimillionaire and a star investor on the hit show Shark Tank. Yet, Robert Herjavec admits, “I’m not a very smart guy.” His family emigrated from Croatia to Canada when he was 8 years old, and he didn’t go to fancy schools. “But I learned from everybody around me,” he says. “When I was a waiter, I learned from the runner how to quickly clear tables. I paid attention to the businessmen’s lunch conversations. I’m a scavenger for education.” Herjavec went on to make a few hundred million bucks as a tech entrepreneur, and he’s proof that you don’t have to be textbook smart to be successful. As he puts it: “The world is full of education if you choose to open your eyes and ears to it.” You’re about to meet five guys who did just that. They overheard snippets of wisdom and used them to become more successful. This simple strategy can work for you too. Are you listening?

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Buy Stocks Regularly To Shave Risk

Anthony Full, 57, operates a men-only, cut-and shave operation with straight razors, big-screen TVs and free beer. Guys don’t just come for haircuts; they come to hang out. And since the shop is hipster central, downtown Cape Town, his “heads” don’t mind paying R200 for a hot-towel shave. One day a few years ago, one of his regulars, the former head honcho of one of the country’s biggest publicly traded companies, came into the shop. “I hear him say, ’If you want to know the secret to building wealth, read Aesop’s tale of the tortoise and the hare,’” recalls Full. When Full got the guy into his chair, he asked him what he meant with all that tortoise-andhare business. “Find companies whose products you use and enjoy,” the guy replied. “And then buy those stocks regularly.” In other words: building wealth is about slow, steady investing. Full committed to buying about R1 000 in stock each month. “The companies I invest in are mostly ones I hear customers discussing,” he says. “It’s satisfying to see the gains add up.”

Your Play: Buy a Lot, a Little at a Time  -Get-rich-quick stock picks rarely pan out. Instead, embrace dollar-cost averaging (DCA), which relies on small, routine investments. “DCA can protect you against market fluctuations,” says Bruce Galloway, a private wealth adviser. When the market is doing well, your fixed investment – say R1 000, like Full’s – buys only a few shares. But when it’s bearish, that grand goes a lot further, and you load up. Over the long run, you’ll probably end up with a lower average cost per stock. Advantage: tortoise.

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For A High Degree Of Success, Be An Owner

Jacob Cohen was at a major varsity’s annual career fair with his son, a doctoral candidate. It was a big deal: a lot of tech companies had tents set up, along with headhunters, trademark attorneys and investors. “At the time, I was a partner in a national accounting firm,” Cohen recalls. “We were walking around, and I happened to overhear this young guy say, ’My friends ridiculed me for dropping out of school, but if I’d listened to them, I’d be working for a company instead of owning one.’” The comment stuck with Cohen, and over the years he thought back on it, slowly folding the message into his own professional strategy. “The point is, if you don’t take risks in life, you will not achieve above-average success,” says Cohen, 76, who expanded his firm several times and eventually sold it to a bigger American one. “Strive to be an owner rather than just an employee so you can control your destiny and direct (and enjoy) the fruits of your own hard work.”

Your Play: Become an “Intrapreneur” – Not ready to use your house as collateral for your harebrained startup idea? Then become an intrapreneur. “If you work for a bigger firm and have an idea for growth, approach your boss with a plan,” suggests Jeff Motske, head of Trilogy Financial, a finance advisory company in the US. The company might let you run with it. Just be sure you have an agreement that allows you to keep equity in case your scheme turns into the next iPhone. If it doesn’t, at least you didn’t fund the failure. But you did learn something that will help your next idea take off.

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Put Your Money On Cruise Control

MJ DeMarco used to drive a limo – matric dances, weddings, that sort of thing. He was 26 and not yet the financial author he would become. Despite having two business degrees, he was living with his mom, trying to plot his future. “This 20-something guy hired the limo service several times a month for drunken excursions,” says DeMarco. “He had just sold his company for millions, and every day was a weekend for him.” DeMarco, broke as he was, was all too eager to listen in on the guy. “That’s when I heard him say, ’Thanks to municipals and treasuries, I never have to work another day of my life.’” Translation: Once you have a sizable pile of cash, you can stock up on investments that deliver predictable returns. And at some point, you can even live off the interest. DeMarco went on to become a millionaire, selling his small Internet startup in 2007. He retired at 37, wrote the book The Millionaire Fastlane, and has been using that eavesdropped advice to cover his living expenses for the past nine years. He drives a Lamborghini now.

Your Play: Reap the Dividends – Even if you can’t live off investment interest, you can still use DeMarco’s plan. “Get into the habit of buying high-quality, dividend-paying stocks on a monthly basis,” says Motske. CDs and treasuries are in the tank right now, but quality municipal bonds (DeMarco’s current favourite) have provided nice tax-free yields. Over the past five years, they have spun off total returns of 4.5 to 5%. If you keep reinvesting dividends in large company stocks, you can build wealth fast, says Motske. You wouldn’t mind driving a Lambo, right?

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