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Doling out advice on money matters is the stock in trade of the financial advisor. After all, it's in their job title. So financial advisors, financial planners, wealth managers and the like are used to offering up advice on a daily basis to paying customers.
But what about the advisors themselves? What's the best piece of financial advice they ever got? Presumably financial advisors, too, consult other experts on financial matters, much as doctors need another physician for their own medical care. Or perhaps it was a parent, a college professor or even a real estate agent who offered the most important financial insight they ever got.
We asked nine members of the CNBC Digital Financial Advisors Council, along with Helen Modly of Buckingham Strategic Wealth, for the best financial advice they ever received.
Louis Barajas, founder and CEO of Wealth Management LAB, Tustin, California: "This one is simple. Spend less than you earn, and invest the difference consistently in a well-diversified portfolio."
Sophia Bera, founder of Gen Y Planning, Austin, Texas: "Invest in growing your career and building a business. The more you can increase your income and become an expert on a specific area, the more money you'll have to reach your financial goals faster than you ever imagined. This creates options and flexibility in the future as you grow your business."
Douglas Boneparth, founder and president, Bone Fide Wealth, New York: "The best financial advice I ever received was also some of the best life advice I ever received. My best friend from business school would always say, 'Do the right thing.' He said it so much that it is still stuck in my head. Whenever I've been faced with a tough decision, I know that if I do the right thing, I will be okay in the end."
Cathy Curtis, founder and CEO of Curtis Financial Planning, Oakland, California: "Holding on to a condo I bought in California. I wanted to sell it to move to another city, and a Realtor advised me not to sell, because it was during a down cycle in real estate. I rented it instead, and then about four years later I sold it for a nice profit. If I had sold before, I would have had a loss. The Realtor told me that California real estate always comes back."
Rianka Dorsainvil, founder and president of Your Greatest Contribution: "Put your financial oxygen mask on first. Being a first-generation wealth builder, you want to help everyone around you, because you're financially better off. However, you have to make sure you're financially taken care of before you can help your community."
Stacy Francis, president and CEO of Francis Financial, New York: "Early in my childhood, I witnessed how devastating life could be for women who were not empowered through financial education. My grandmother remained in an abusive relationship. When I was old enough to ask why, my grandmother explained that she stayed because she believed there was no other choice, as she lacked the financial stability to change her situation.
"From then on, my mother insisted that I should never rely on someone else for money. That advice and experience led me to change my major in college and drove me into the finance field."
"Unfortunately, my grandmother is not alone. This kind of financial dependency, and its accompanying fear and disempowerment, still exists today. About 56% of married women allow their husbands to make all of the long-term financial decisions, according to a 2018 report from UBS.
"Moreover, if couples divorce, women need more than a 30% increase in income to maintain the same standard of living they had prior to the divorce, and typically they never fully recover from the financial consequences of divorce, according to 'Gender Differences in the Consequences of Divorce' [by Thomas Leopold.] On the other hand, men's standard of living tends to increase by 10% after divorce. Proving why my grandmother chose to stay.
"So having women educate themselves on their personal finances and understanding what's in their portfolios is crucial for their self-confidence and relationships."
Zaneilia Harris, president of Harris and Harris Wealth Management Group, Upper Marlboro, Maryland: "The best financial advice I received was in college, when one of my most influential professors advised me to never stop learning. He stated that you could lose your job but no one can ever take away your knowledge. Your knowledge can be leveraged for other professional opportunities. This is especially true in this digital age, with this tremendous push for information and content. He was foreshadowing the future. That is why I embrace growing my knowledge."
Ivory Johnson, founder of Delancey Wealth Management, Washington, D.C.: "When I came home from college, I told my dad I wanted to buy a car. He asked me what kind of car and I told him I wanted a Jeep. He then asked if I would have nice speakers and I said 'absolutely.' He paused and said, 'Make sure you have a shower inside,' because if I was dumb enough to buy a car when we lived in Manhattan, I would have to move out immediately."
She added: "He told me to buy an apartment in the neighborhood, because he knew it would eventually be gentrified. A $20,000 apartment in the Lower East Side is now worth $500,000, which I'll use for a 1031 exchange to buy $1 million worth of rental property in D.C., where I now live."
Diahann Lassus, co-founder, president and CIO of Lassus Wherley, New Providence, New Jersey: "When I was in high school, I was told that if you know what your income is and you know what your expenses are, you are in control of your savings plan. It certainly worked for me in my younger years. Really understanding those two things allowed me to pay my way through graduate school, save for specific purchases and begin a savings program in my late 20s. That savings program ultimately helped finance starting Lassus Wherley.
"Many people avoid tracking expenses because it takes too much time or it is too much trouble. The reality is that it doesn't have to be scientific to help you plan. You already know what your regular monthly expenses are, like rent or a mortgage, utilities and telephone. The real challenge is figuring out those discretionary expenses or the choice expenses you can decide whether or not to spend, such as travel, eating out, buying clothes and entertainment.
"Those are the areas you have to pay attention to over time to make sure they don't get out of control. After many years, I still monitor monthly total expenses to make sure they are in line. No matter what phase of life you are in, understanding where you are is the most critical element in planning for the future."
Helen Modly, wealth advisor at Buckingham Strategic Wealth, Middleburg, Virginia: "Never use debt to acquire a depreciating asset. For a first-car-after-college sort of thing, use the least amount of debt over the shortest time frame you can afford. Cars, vacations, celebrations should rarely be financed. Houses, business interests, investments, education, etc., can be carefully financed.
"Early in my career, the prevailing wisdom was to only worry about the cash flow. If you could afford the payments, you could afford the thing or experience you wanted. My first boss explained the difference between debt and leverage and how just being solvent on a cash basis would never create wealth. I saw this in full force during the housing bubble. People were using their home equity as an ATM to finance all sorts of toys and experiences. It didn't work out well.