Grant Cardone’s Most Outdated Piece of Advice (But Can It Still Work?)

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Real estate billionaire Grant Cardone has shared a lot of useful advice that is aimed toward growth investors. He doesn’t believe in playing it safe and opts to use leverage whenever interest rates are low enough. However, his advice doesn’t apply to everyone.

Some of his strategies are too risky for some people to consider, but investors who are in positions to take greater risks can still benefit from many of his strategies. You should give it a second thought before applying any of these suggestions.

Never Buy a Home To Live In

Grant Cardone isn’t the only one to suggest that you should rent instead of buying. There are practical benefits of renting, such as not making a big down payment and having lower rent payments than mortgage payments. You also aren’t responsible for any expensive home repairs. Your landlord takes care of maintenance and other details, while you get to invest your money into assets.

Owning a home frees you from the risk of landlords who hike rent, but even then, property taxes, home maintenance, and repair costs go up over time. Never buying a home works for some people, but this argument loses steam when considering forced savings and generational wealth.

Some people are not financially disciplined enough to invest their money. Others immediately exit the stock market during volatility. A mortgage is a form of forced savings that guarantees you build wealth over time.

The second key factor is that you can pass real estate on to your heirs. It’s the equivalent of planting a tree and knowing that you won’t get to benefit from its shade. Some people pass fully paid off homes on to their children. Then, they never have to worry about rent and mortgage payments.

That advantage can give your children substantial options, such as the ability to have more kids of their own or not having to deal with common financial obstacles like mortgage interest payments. You can’t pass on a rent-free unit to an heir because the rent is due each month without you building any equity.

Retiring at 65 Is a Myth

This advice has some merit, but it can be disastrous for some people if they see it through. Cardone has criticized the idea that you should build a nest egg and retire at 65. Longer lifespans suggest that working longer is the right move, but if you avoid building a nest egg, you do not give yourself the option to retire.

People in their 30s and 40s may think that they can work forever. However, if you are in a physically demanding job, working into your late 60s and 70s will likely become infeasible. It’s easier to work forever if you have a job that isn’t labor-intensive, like consulting. Construction workers don’t have the same luxury of being able to work in their 70s and 80s.

A nest egg covers situations like this, and it gives workers the ability to retire much sooner, such as in their late 50s and early 60s, before their bodies start to give out on them and resulting in expensive medical bills.

People who retire to get out of labor-intensive jobs can pivot into other industries that don’t require as much work. However, not everyone has that mindset. A nest egg is a valuable hedge for most people. Not everyone is an entrepreneur who can see opportunities and switch to a new career on the spot.

You Shouldn’t Start a Small Business

Cardone’s advice on starting a business may be shocking to people who have seen him launch many companies. He views starting a small business as selfish since 64% of them break even or lose money. Cardone is looking at probabilities and coming to the correct conclusion that most small businesses go under. Then, all of the workers have to look for new jobs.

Starting a small business is your best path to scalable income. Your earnings are capped when you work with an employer. Sure, you might get the occasional 3% raise, but billionaires achieved their fortunes by starting businesses and investing their extra cash. Cardone suggests you should buy an established business instead of starting a new company, but small businesses are easier to get off the ground.

Some small business owners replace their jobs with their companies and provide employment opportunities for people in their community. It’s not easy to start a small business that achieves sustainable success, but it is worth the effort for you and your future employees.

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