Imagine waking up to find an extra $100,000 sitting in the bank.
For plenty of people, the mind races straight to stocks, real estate, or the next hot investment. Mark Cuban's first move is far less exciting. In fact, it starts in the cleaning aisle.
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When Forbes asked the billionaire entrepreneur back in 2010 what he'd do with a fresh $100,000, his answer wasn't about finding the next Apple (AAPL) or predicting where the market was headed. It was about getting rid of debt, buying everyday necessities in bulk, and keeping cash on the sidelines until the right opportunity showed up.
It isn't flashy. That's precisely the point.
Cuban didn't hesitate when laying out his game plan.
"First I pay off all my credit card debt and evaluate paying off any other debt I have," he said. It's a logical first step. With many credit cards charging interest rates north of 20%, eliminating that debt can deliver a return that's difficult for most investments to match.
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But then comes the part that catches most people off guard.
Rather than hunting for market-beating returns, Cuban looks through annual household spending and asks a simple question: Which items are guaranteed to be purchased anyway?
His answer includes everything from toothpaste and soup to other everyday essentials that eventually end up back in the shopping cart.
"I look to see where I can save the most money on those items," he explained. "Saving 30% to 50% buying in bulk … is the best guaranteed return on investment you can get anywhere."
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At first glance, buying toothpaste by the case hardly sounds like investment advice.
But Cuban isn't talking about filling the garage with products that will never get used. He's talking about expenses that are practically unavoidable. Most households know they'll keep buying toilet paper, shampoo, laundry detergent, and pantry staples year after year.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
