We live in an era when immediacy and short-term thinking often trump the foundational wisdom that makes a difference in one’s financial life. Our 19 money masters share some timeless insights
Ben Stein
AUTHOR, ACTOR, FINANCIAL COMMENTATOR
In his latest book, How to Really Ruin Your Financial Life and Portfolio (Wiley, 2012), former game show host Ben Stein plays devil’s advocate by guiding readers into surefire ways to commit financial hara-kiri. “Pay No Attention at All to Taxes” is the title of Chapter 17.
But Stein’s contrary approach to financial advice belies a lifetime of financial smarts and wealth accumulation. For example, he still owns Berkshire Hathaway common stock he bought in 1983, when it sold for about $1,300 per share (it now trades for more than $171,000).
According to Stein, the best money advice he ever got came from his father, Herbert Stein, a Nixon Administration economist who lived his life with extreme financial prudence.
“I love real estate, but once, before I was about to buy an estate on the Eastern Shore of Maryland, my father warned me never to move into the neighbourhood of poverty,” says Stein, 68. Stein’s father wasn’t talking about this Chesapeake Bay enclave per se but was referring to taking on too much risk in any one deal. “It boils down to not having a meaningful amount of unsecured debt. It’s poison,” says Stein, who owns 12 homes.
As for getting rich, Stein advises to start young, buy stock index funds in the form of ETFs and reinvest the dividends. He also likes variable annuities, provided they are low cost.
“To me money in abundance is paradise and power and love. In scarcity it is terror and guilt.”
(This story appears in the 12 July, 2013 issue of Forbes India. To visit our Archives, click here.)