Barbara Corcoran Recommends Making This Investment Before Turning 30 — Is She Right?
Written by
Angela Mae
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Molly Sullivan
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What could it be? An IRA, 401(k)? Nope. In an Us Weekly interview, Barbara Corcoran said that travel was the best investment to make before you turn 30.
If you’re wondering why, here’s what she said about traveling, why she thinks it’s one of the most important things to invest in while you’re young, and whether this advice still holds up — according to financial advisors and planners.
Travel Is the Best Money You’ll Spend
According to Corcoran, people should invest in at least one good trip before they turn 30. It doesn’t have to be an international vacation either. It could simply be a weekend trip to someplace you’ve always wanted to go. But regardless of your destination, you shouldn’t be afraid to spend money on it.
“Think of where you most want to go and blow a lot of money on it…The one thing the world can’t take away from you is a phenomenal memory of where you were, and how much laughing you got done when you were there, away from your homefront,” Corcoran said.
Unlike material items, Corcoran pointed out that travel is also one of those things that you get to keep forever — or at least the memories you got from your trip. And the experience itself is something that can make a difference in who you are and who you become.
Traveling Can Be a Great Investment — If You Can Afford It
Corcoran’s advice about choosing travel as your No. 1 investment while you’re young has its merits. But not everyone can afford it.
“For many of us, travel has a great return on investment in the memories we make. Traveling when you are young may be formative in your perspective on the world and figuring out what is truly important to you,” said Jay Zigmont, PhD, CFP®, founder of Childfree Wealth®. “The challenge is, when you are young, you are less likely to have the extra cash for traveling.”
Not only that, but Zigmont’s advice is to focus on paying down any debt before blowing money on travel. Once that’s done, you might want to start saving up.
“If you are in debt, you need to focus on paying off that debt prior to traveling,” he said. “You also don’t want to take out new debt to travel.”
So, what if you don’t have any debt and still can’t save up enough money to travel? There may be ways to afford it even then.
“The best bet is if you can get someone else to pay for your travel,” Zigmont said. “Look for jobs or volunteer opportunities that come with planned travel. Many businesses will allow you to tack on extra time to a business trip for pleasure if you cover the hotel and food. In just a few years, my wife and I were able to tack on trips to China, France, and Spain, all by leveraging work opportunities.”
Travel Could Be the Way to ‘True’ Wealth
Young adulthood is also the time to discover what it means to build “true” wealth, and this is something you could discover through travel.
“My true belief is travel allows us to understand different cultures, which ultimately brings us to understand who we truly are. Once you know who you truly are, it allows you to align and build your ‘true wealth,'” said Stoy Hall, CFP, CEO and founder of Black Mammoth.
“Our industry gets ‘investing’ all wrong,” Hall continued. “We focus on ROI and what the stock market is doing; we need to focus on experiences and balancing investing back into ourselves, both mentally and physically. Once you have aligned your mental, physical and financial health, your wealth truly grows!”
Hall did recommend starting small or with local trips and working your way to bigger or more expensive trips. Unlike Corcoran, who advised splurging on the trip, he also suggested setting a realistic travel budget and adding to it each month as you would to any savings or investment account.
Travel May Be a Great Expense Rather Than a Wise Investment
For some people, travel could be a good investment in themselves, their life experiences and their personal growth. But for others, especially those who might want to start a family, it might be a good expense instead.
“I would probably refer to travel as an absolutely good expense rather than an investment,” said Chris Urban, CFP®, RICP®, founder at Discovery Wealth Planning. “If you are considering settling down and starting a family, I highly recommend doing as much travel as possible before this phase of life begins.”
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