Warren Buffett famously said: “Do not save what is left after spending, but spend what is left after saving.”
Shark Tank star Barbara Corcoran disagrees—she spends it all.
The real estate mogul says she’s never saved a penny in her life—a philosophy instilled in her by her mother—and that by investing it in business or other people the returns have kept coming back.
Corcoran, who earned her millionaire title courtesy of New York real estate business the Corcoran Group, told CNBC her best advice for making money is to spend it in the first place.
“I’m just not a believer in saving money. I’ve never saved a dime my whole life,” she said.
“I had a mom who raised 10 kids on a shoestring budget, and she always said money is meant to be spent. And she didn’t have much to spend.”
The lesson stuck with the property mogul, who having sold her business for $66 million in 2001, immediately began plotting how she could spend it.
And that’s fine, she believes, as long as you’re spending your money on the right things.
The 74-year-old said she gave half the proceeds to “family, friends, education funds, charities, because I really believe if you spend, money comes back to you.”
“I think the carefree attitude of believing that money makes money, if you’re willing to share it and spend it, really works, or at least it has certainly worked for me,” she continued. “And I don’t believe in hoarding money, saving money, everything like that. Because for me…it would take my spirit away.”
Investing is certainly a key component of her role on Shark Tank, with Corcoran having offered up an estimated $16 million according to Humble Rise—a website dedicated to the show.
Even so, Corcoran has previously been open about the fact that not many of her businesses have provided huge returns—she’s simply in it to support passionate people.
“I’ve invested in 150 businesses, and I’ve made money on about 10%,” she revealed earlier this year. “I’m looking for ambition. Someone who envisions where they’re going, and I fall for it when they tell me they’re going there.”
The TV mogul—who nearly lost her spot on the panel before an episode even aired—added she’s nearly gone bankrupt five times and always managed to bounce back.
The last time—during the 1990–91 recession—Corcoran’s mother told her: “Don’t worry about the money. It’s a waste of time. I thought of an idea that made me a million dollars the next week.”
What do the other sharks say?
The other sharks on Shark Tank have other ideas.
Mark Cuban, for one, has the opposite mentality to his panel peer.
In 2015, Cuban shared his tips on how to get rich, and his advice was pretty simple: “Save your money. Save as much money as you possibly can. Every penny you can. Instead of coffee, drink water. Instead of going to McDonald’s, eat mac and cheese.
“Cut up your credit cards. If you use a credit card, you don’t want to be rich. The first step to getting rich requires discipline. If you really want to be rich, you need to find the discipline.”
Fellow panelist Daymond John is also a fan of saving, encouraging members of the public to “think before [they] spend.”
3/Think before you spend. Ask yourself if you really need something before you buy it. If it’s not a necessity, consider saving your money instead.— Daymond John (@TheSharkDaymond) March 11, 2023
Speaking on YouTube John explained: “Every time you get a dollar or a paycheck…there are three ways to spend that money, and people always use them backwards.
“Number one: You pay for what you absolutely need. Number two [is] really critical: Invest. Number three: Treat yourselves to the things you don’t need but you would like to have.
“People usually do number three as number one; they never do number two, and number one is number three.”
And Canadian businessman Kevin O’Leary is also a fan of saving—though not to the same extent as other professional finance experts.
O’Leary suggests individuals should “have three months of salary on hand in case of emergency” but not the six or even 12-months’ worth personal finance expert Suze Orman suggests.
Speaking to CNBC, O’Leary explained this is because of high inflation rates relative to interest, meaning money left in the bank isn’t getting the gains it traditionally should.
Instead he suggests investing: “Savings in cash in a bank account make basically no interest, certainly after inflation. Investing is keeping pace with the equity and stock markets. And I think you’ve really got to understand the difference between the two.”