Billionaire Peter Mallouk’s Investing Tips: Avoid This, Buy That, Ask This
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Peter Mallouk, president and CEO of Creative Planning, as well as author of the “The Path: Accelerating Your Journey to Financial Freedom,” sat down on the podcast “Money Rehab with Nicole Lapin” to share some crucial tips for investing. While most people have to go to business school to learn all the tricks of the trade for investing, Mallouk shared his years of wisdom and insights in less than an hour.
Mallouk has his own set of strategies, ideas and tips for getting started investing. Here are some of his investing tips, including what to avoid, what to buy and a question that everyone should ask before investing their money.
Also see the five best ways to invest $10,000 in 2025, according to Humphrey Yang.
Avoid This (Mostly): Cash and Bonds
In Mallouk’s opinion, cash and bonds should mostly be avoided by new and young people who are looking to jump into the game of growing their wealth by way of investment. Cash is, in Mallouk’s words, “dead money” and cannot act as an investment. As an investor, you want your money to work for someone, namely you, which cash cannot do. However, Mallouk did advise holding some cash in case of emergencies.
Bonds, Mallouk pointed out, tend to return less than stocks. While bonds do grow your money, there are restrictions to when and how you can access the funds, making it harder to move your investment when you need to.
But there are some reasons to hold some bonds. “But maybe, maybe, I will buy another house in five years that will require some money from me, or maybe I’ll want to start a business in three years. That’s where the bonds come in. I want to have enough bonds to cover three to five years in case I want to do something big,” Mallouk said.
Buy This: Stocks
Mallouk encouraged investors to put their money in stocks in order to see higher returns and to be able to have access to the funds when they wish to sell them off. Anyone who is worried about the risks associated with stocks should take some time to explore and experiment in the market, per Mallouk’s advice.
According to Mallouk, it’s better to be in the stock market than outside of it because even when it crashes, it historically always comes back. In fact, according to SoFi, the S&P 500 returns an average of 10% per year, despite drops and crashes along the way. As SoFi explained, the stock market fell by 38.49% amid the financial crisis in 2008. However, in 2009, it returned 23.45%.
While the market tends to come back after crashes, what does not return is the level of opportunity that some investors miss out on by waiting on the sidelines. “Being in the market is much less risky than being out of it,” Mallouk said.
Ask This Question: What Are You Comfortable Investing In?
Should you choose to go the route of investing in stocks or in commodities, you likely will have to ask yourself what you’re comfortable investing in. If you’re investing in index funds, you’re investing in lots of different types of companies, Mallouk explained.
However, he noted that some people prefer to screen out certain types of companies, like those focused on energy or weapons. Therefore, you should assess what your moral barometer is and how comfortable you feel investing in certain business sectors.
Lapin pointed out that where you put your money is similar to casting a vote. So ask yourself ahead of investing: How good do you feel about where you are putting your money?
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