Talking Billions with Bogumil Baranowski

Barry Ritholtz: How Not to Invest — Why Billionaires Driving Old Cars Are Financially Reckless & More

12 snips
Jun 23, 2025
Guest
Barry Ritholtz
Barry Ritholtz, founder of Ritholtz Wealth Management and author of "How Not to Invest," shares valuable lessons on financial decision-making. He discusses how Instagram culture leads to misguided perceptions of wealth, illustrating that seeing only assets can be financially reckless. Ritholtz argues successful individuals can indulge in new cars for safety, debunking the idea of extreme frugality. He emphasizes that money is a tool, not just a means to hoard, advocating for an approach centered around increasing income rather than merely budgeting.
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ADVICE

Make More Money, Not Budgets

  • Instead of meticulous budgeting, focus on making more money to gain financial freedom.
  • This approach reduces stress over small expenses and increases spending flexibility.
INSIGHT

Seeing Assets Without Liabilities

  • People often only see assets without understanding associated liabilities, leading to poor financial perceptions.
  • Extreme cheapness can be financially reckless when it ignores practical needs like safety.
ADVICE

Spend Wisely on Safety and Joys

  • Buy new cars with modern safety features if you can afford it to protect your life and family.
  • Splurging on small pleasures like a daily latte is fine if it fits your finances; avoid needless stinginess.
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