Mark Cuban is definitely one of America’s most popular billionaires. From being a TV personality on “Shark Tank” to his involvement with an NBA team, this entrepreneur knows his way around a sound financial decision.
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So, when a man such as Cuban, who currently has an estimated net worth of about $6 billion, dishes out some advice, you should take it and pass it on. Keep reading to find out what he believes in the best way to build wealth.
The Best Way To Build Wealth: Investing
According to Cuban, the best way to build wealth is to “have appreciating assets. Whether it’s a home or a mutual fund — something that can appreciate over the long term.”
Here are some quick examples of appreciating assets:
- Real estate investments: Houses, apartments and commercial buildings often appreciate over time. For example, Cuban’s property portfolio includes Dallas mansions, a Trump International Hotel and Tower condo and more.
- Stocks, bonds and ETFs: Investments in the stock market such as these can increase in value as the companies or sectors they represent perform well and grow. More specifically, bonds can grow in value if interest rates fall or if the issuer’s creditworthiness improves.
- Cryptocurrency: Digital currencies like bitcoin and ethereum have experienced significant appreciation in value in recent years, and Cuban is a huge supporter of this type of asset. He is known to invest in both bitcoin and ethereum as well as dogecoin and more.
Cuban’s Advice for Investing in Companies
So, what metrics does Cuban look for to determine if a company is a good investment? Are there also non-quantitative factors to look for?
“For private companies, it’s a lot of things,” explained Cuban. “Is it a great entrepreneur, is it a strong product, is it differentiated?”
He continued, “For public companies, I recommend people focus on investing in funds.” But keep in mind that “investing in individual stocks has gotten harder over the years because there is so much money chasing stocks.”
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How To Start Investing Like a Billionaire
We asked Cuban, “What advice would you give someone wanting to start investing but unsure where to begin?”
His answer was short and sweet: “Learn as much as you can but be patient. There are no shortcuts.”
Here are a few quick steps to get your foot in the investing door:
- Step 1: Make the decision to start investing today, even if it’s just a small amount.
- Step 2: Assess your risk tolerance and decide how much you want or can afford to invest.
- Step 3: Figure out your investment strategy and open an investment account.
- Step 4: Work with a financial advisor to help you better understand your investment options, such as putting your funds into real estate or buying a company’s stock. There’s not just one choice and diversifying your portfolio can be a great way to grow your wealth.
Jaime Catmull contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: Mark Cuban: Here’s the No. 1 Thing You Should Do To Build Wealth
