Gives Horrible Financial Advice To Young People

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. does not include all card companies or all available card offers. All opinions expressed are the author’s alone.

I know there is plenty of bad advice out there, but this one just caused me physical pain. Mr. Cliff Mason impressively gained the status of Staff Reporter at fresh out of college (did I mention his uncle is Jim “Mad Money” Cramer?). He hits the ground running with his recent article Young Ones, Go Forth and Speculate, where he bashes veteran Wall Street Journal reporter Jonathan Clements and proceeds to share some of his vast financial knowledge with us.

Pearl of Wisdom #1:

I believe that saving money is at best nonessential for the under-30 cohort, and that people my age will generally get more from spending their money than from buying stocks or bonds.

Pearl of Wisdom #2:

Buy small-cap stocks that trade under $10, have little analyst coverage and a reason to go higher. In a word: Speculate. […] With maybe $2,000 to invest a year, you won’t make serious money in the market unless you take enormous risks. It’s much more likely that you’ll get wiped out, but since you won’t have a lot of money on the line, it’s a worthwhile risk.

Wait, there’s more! You must see Mr. Mason in person in this video showing off his brand new iPhone. Why did he buy this phone? “Well, I wasn’t doing anything… and I had money to burn… it is a babe magnet…” What about his current plan? “I have an old Verizon line that my dad still pays for [the iPhone is AT&T-only] … I should tell him about that…”

Hmm… sure sounds like someone I should listen to for financial advice!

I found this article via the Diehards Forum, where author Taylor Larimore submits his succinct reply:

If a young investor age 25 invests $4,000/year @ 10%, at age 65 he/she will have $1,947,407.

If a gambler waits until age 35 (and loses), he/she will have $733,774–less than half.

Investing for retirement should not be a gamble.

My response? As a 20-something who tries hard every day to balance enjoying life now, buying a house, and funding my own retirement someday, I’m a bit offended by his flippant views on saving.

I don’t really care what Mr. Mason does with his money. But to tell others to just gamble it away because it’s “not that much”? Being 25 and actually having $2,000 saved up is not something to be dismissed. Not only can you take advantage of the wonder of compound interest, but look at how risk decreases as your time horizon increases when properly diversified. Why increase your risk needlessly when you could be decreasing it?

Okay, maybe I’m being too harsh. When you’re young, you should take risks. Go into debt to pay for college or graduate school, work at a start-up company or at a non-profit that you love, or even start your own business. Take chances with money that can really reap huge rewards!

My Money Blog has partnered with CardRatings and may receive a commission from card issuers. Some or all of the card offers that appear on this site are from advertisers and may impact how and where card products appear on the site. does not include all card companies or all available card offers. All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. is also a member of the Amazon Associate Program, and if you click through to Amazon and make a purchase, I may earn a small commission. Thank you for your support.

User Generated Content Disclosure: Comments and/or responses are not provided or commissioned by any advertiser. Comments and/or responses have not been reviewed, approved or otherwise endorsed by any advertiser. It is not any advertiser's responsibility to ensure all posts and/or questions are answered.


  1. Christopher says

    That guy’s advice is completely irresponsible. What he is advocating is gambling.

  2. Is this guy serious? First, it’s a dumb assumption to think that young people only have 2k a year to invest. With 401k, company match and roth, I have at least 10k a year in the market at 24. Second… wow! What bad advice!

  3. Wonderful reply – I hope it gets out.

  4. I emailed the author your response! I can’t believe this kid.

  5. You’re not being too harsh. That’s absurd. Clearly the only skill he had to get that job was being related to Cramer. That is absolutely the worst financial advice I’ve ever heard. He is obviously screwing his future self by living it up today and he wants others to come along on the ride. For him to be doling out financial advice like that is totally irresponsible. I’ve just lost even more respect for the Street.

  6. This is why I read your blog! I completely agree with you!! keep up the good work.

  7. Absolutely agree with you – this advice obviously comes from somebody that doesn’t have to worry about money. The cavalier attitude about money illustrated here is what gets people into trouble – their experience is not enough to gauge the risks involved (I can buy this on my credit card now, because my income will increase -etc). With that advice, I should go into as much debt as possible to maximize these potential “killer profits”. If I go bankrupt, so what – I’m still less than 35 right?

  8. I just did a search for his other articles and the titles are:
    Need Emergency Cash: Use Mom and Dad
    Don’t Save for a Disaster…that is what Dad is for

    His attitude just smacks of entitlement and privilege. Makes me want to barf a little as a twenty-something.

  9. How appalling!

    The only advice little boy Mason should be offering is how to fully take advantage of family bonds. Someone shut off his microphone and give him a spanking.

  10. On the other hand I agree that you probably shouldn’t have 40% in bonds……


    This guy still gets $$ from his parents. His parents will always be there to bail him out, no matter what which means he’ll never be in a financial crunch. He should be fired.

  12. You all are correct. I did not know Cliff Mason is related to Jim Cramer.

    Good FYI. I knew something did not seem right when I read this article.

  13. Agreed!

  14. Siggyboss says

    I tend to agree with the ‘kid.’

    Just as someone can save too little, they can save too much. Although you can’t calculate a precise number, there is an opportunity cost in going to the Bahamas when you’re old, versus when you’re young. As we all know, life is much better when you’re young.

    Also, for the average person the majority of savings come from their income. Young people tend to have meager incomes, parents to bail them out, and time to recover from incredible loses. By the time you reach 30 you can settle down, and still have another 30 years before reaching the typical retirement age.

  15. I think this kid is intentionally being inflammatory. Anyone who’s ever taken personal finance 101 knows that saving early is one of the best ways to retire comfortably. He also seems to have trouble grasping the concept of compounding when he says that you should not invest in your 20’s because you don’t make a lot of money. Kind of sounds like he’s the Fredo of the Cramers family.

  16. Cliff Mason is under the assumption that you income will be going up as you get older. What’s the point when your making $35,000 your first few years out of college to be saving a couple thousand a year. At 10% return that is just $200. You could really increase your standard of living by just spending the money. If you do decide to invest it wouldn’t make much sense to earn $200 in interest for the year. You can make that opening a credit card at AmExp. You might as well invest in something speculative that can really generate you some serious money eventually. When your 40 years old and making $120,000 then it will be much easier to save and conservatively invest that will eventually amount to something. Cliff also says that once you are in your 30s or have kids the rules change back to save and conservatively invest. (these salaries are in mid-west America. I understand to California and New York people these would be absurdly low).

    Also, the does not have just one opinion about investing. They employ dozens of writers to write thier opinion and hopefully the readers can find the truth through all of it. By the way Jim Cramer gives Cliff Mason a pretty hard time in a couple of the videos on the site about these controversial topics.

  17. Lousy Jack says

    iPhone..chick magnet???? ha hahaha … this is funny (and absurd)
    If I were to describe Chris Mason in a few words – An insecure/ under confident (looser) who never gets laid!!!! 😉 Probably still lives in his dad’s basement and likes to share his immature views in public. The irony is – he doesn’t even realize how stupid he is. (Its sad..isn’t it?)

    Jonathon – I completely agree with you.

  18. I used to laugh at those who claimed “the Devil” was in music and television. As I have gotten older, though, I see that the Devil–or his secular proxy–indeed is alive and well. What does the Devil do? He tempts you to waste and, in the end, leaves you with nothing, and sometimes less than nothing.

    And the current case is just such an example. The counterargument: If I had saved more in my twenties, I would be filthy rich in middle age (with 30-50 years still ahead of me). Bosh on the upstart Devil!

  19. I admit, when I originally read that article, I thought it was just a sales pitch. After all, if you intend to speculate, you’re going to need information and you’ll, naturally, want to buy that from them.

    It certainly wasn’t something I believed in. On the other hand, if it got you interested in savings you would have blown on “stuff” it might be worth it. My younger brother goes to the casino relatively often for entertainment. Better to wager at cards or wager in investments?

    If you make your mistakes early, and before you’re playing with large sums, there might be some merit in the advice. When it comes to real savings, you’ll have already taken your knocks and learned your lessons. It was never advice that was going to apply to me however, but I’m a mathematician and inclined to play everything by the numbers (always have been).

  20. The sad part is that I’m sure people will take what this guy says as legitimate advice and follow his lead.

  21. It seems his advice is geared for people more interested in “gambling” with the market. I’m thinking most of the people interested in this blog aren’t that type. It’s all in how you value your time. I’d rather do side work and start a small business than spend time researching stocks. I think the potential networking and side income will be more valuable in the long run as well.

  22. I agree with you, but a little bit with him too. Because I worked my way through college — and left without any debt. When I was in my late teens thru to about 24 (when I graduated), I worked at lots of low paying jobs and really suffered my way through college. I really loved college too — but was so tired all the time running from job to school, I couldn’t enjoy it as much as I should have. I didn’t want to take any loans and had practically nothing in spending money.

    If I could go back in time, I would have financed my entire education and then some (even spending money). The I would have really enjoyed college and would have left, at that time, with approximately less than 15K in debt (I went to a state school). That would have given me enough for school and for spending money, and I would have had a ball. My first real job paid almost 3 times that much (in comparison to my close to minimum wage jobs prior to graduatng), and I would have easily paid it back in a year. Not believing in myself enough to do this was a big mistake. You are only that age once.

  23. Watched the video: sorry to appear base (or resort to ad hominem), but it is clear that Mr. Mason A) has some self-esteem issues–among other types of issues–and B) he needs whatever “babe magnet” he can afford. He has “made good” and wants/needs the world to know.

    For the more well-balanced among us, stick to the joys of frugality.

  24. Heh, the iPhone comment threw all possible credibility out the window.

  25. I saw that article when the post was first made on Diehards. Unfortunately, as poor as his advice is, I think there are lots of people out there who already think this way without ever having read a word of this guy. I’m in my 20s, and I know people who think like this — that they’re young, retirement is decades away, and they have plenty time to save in the future.

    Be that as it may, there’s something to be said for enjoying the here and now as well. You have to find a balance between saving for the future and living for the present, without sacrificing too much of either.

  26. well, while you’re at thestreet, check out the latest on what cramer has to say about housing, he’s gone from ultra-permabull and done a 180 and is the most bearish guy on housing i’ve ever heard now

  27. Hey Siggy, why the negative vibes?

    As we all know, life is much better when you?re young.

    I’m 26 (nearly 27) and life is far better for me now than it was when I was 19. Small range, I admit, but the “no-fun” middle-agers that I’ve met all got there by virtue of wanting to be “no-fun”.

    People have a tendency to grow attached to their stuff and lifestyle (“no laundromat for me”, “I’ll never rent again”, “Protein shakes every day”). So as they get older they get “ornery” when “stuff goes missing” and they get sedentary. I mean are you incapable at 40 of doing things you did at 25? Can you suddenly not parasail b/c you’re over 33?

    All I’m saying is don’t buy in to the “youth is good” hype. Age tends to deepen appreciation for quality, not lessen it.

    As to: By the time you reach 30 you can settle down, and still have another 30 years before reaching the typical retirement age.

    I’d like to warn my fellow 20-somethings: unless you are are like Jonathan and socking away tons of money, you will not “retire” at 60 or 65.

    Look, the average life expectancy was 63 when retirement was set at 65. The process was used to displace older people so that younger people could work. We North Americans added pensions at work and in the government levels to continue to fund this stuff even as life expectancy crept up. And the system works OK until you hit a life expectancy of about 75 or so.

    Barring an epidemic or a mass fall-out from obesity / cancer, we 20-somethings are going to live to 80+. We’re already increasing “retirement age” and the trend will continue. B/c the math is really simple: you can’t have people in school for 25 years, retired for 15 and then only working for 40, that means that half of your population at any given time is not working!

    This doesn’t scale, we 20-somethings cannot safely imagine that 65 will be the “magic age” when we stop working. We should just keep reading these blogs and working our way towards accumulating enough wealth to “do whatever we want with life”. But I’m not going to imagine that any of my peers will be magically “retiring” at age 65 without some other form of serious planning on their part.

  28. Being a 20 year old and still having 2 years of college left, I’m glad I found your website through a google search rather than finding guys like him to tell me about investing.

  29. Life is all about balance. The Ying and the Yang. I’m 22 and you are only young once, so you should enjoy your youth, while taking steps to prepare for a comfortable retirement. Duh.

    What an idiot though, his first response to why he has the iPhone is “It’s a Babe Magnet.” Why would you EVER want to date someone that was with you for your money? or a cool gadget you have? So superficial. He’s clearly a confidence-inflated loser who has no right to be writing for any kind of financial advice news source. Unprofessional, and Pathetic. You can just hear Farnoosh Torabi TRYING to maintain a respectable interview, but Cliff just kills it with every word that comes out of his mouth. How frustrating. He can’t even come up with real reasons why he likes it. Farnoosh asks “Can I touch it?” and Cliff responds “See, THAT’s why I HAVE to have it.” Because he can’t do it on his own. So sad.

    It makes me hate Jim Cramer just a little bit more than I already do for manipulating the markets.


    Please stop saying otherwise. It’s flat wrong and may cause people to take more risk than they have to or want to.

  31. “If you get in trouble and need to bail yourself out, the last thing you want is to spend your own money. The best way to avoid that is to make sure you can’t afford to fix whatever the problem is. Young people are better positioned to pass off the cost of emergencies than any other group…

    …It doesn’t make sense to save money in preparation for problems that you may not have to pay for yourself. The person who puts money away for emergencies is giving up opportunities for free money.”
    -Cliff Mason

    You have got to be kidding me. I didn’t know that people like this existed. That’s the mentality of a 12 year old.

  32. Looks like he wanted press to me, and you gave it to him. After all, he is getting paid to sound like a total moron.

  33. Ms. Know It All says

    I like totaly agree with Mr. Mason. We young people need mentors like Mr. Mason. I can’t imagine you guys are being so harsh on him! Like this is totally absurd! Like it’s obvi that it makes sense what Mr. Mason says. Like I mean come on, you have to live your life, you know what I mean? Like it is for real!

  34. It’s hard to believe that people like that get jobs where people listen to them. There is something to be said for spending a little more in your 20s than later in life just because your responsibilities are less, but to spend everything and not have any sense of secure retirement just seems silly to me.

  35. Thanks for providing this link. I cannot believe this guy! I’m a newly-minted 23 and well-aware that this is the kind of reasoning that is commonplace among those my age. It is absolutely devastating that so many have this sense of “it’s all good” and “good things are coming”, and it makes me fear the future.

    I do have to give him credit for one thing: keeping 40% of your portfolio in bonds (when you’re in your early 20s) is ridiculous. You might as well stick it in a high-yield savings account ala iGoBanking for easier access, in case of emergency. (Then again, I’m betting this guy doesn’t understand the concept of an emergency fund.)

    In response to Mr. Small-Cap Speculation, if you had $2000 in August of 2006 and spent all of it on Amazon (AMZN), you’d have managed to buy ~60 shares. That stock today would be worth ~$4700. A one year return of 135%? Not too shabby. Why risk losing everything when you could have done this?

  36. Mason clearly does not understand the concept of COMPOUNDING.

    On his disparaging remark of *only* a 10% return on $2000 ($200 net for a year)… well, extrapolate out to your lifetime — DO THE MATH.

    There’s an urban legend that claims Albert Einstein once declared compound interest to be the most powerful force in the universe.

  37. His advice will work out GREAT.. for the 0.0005% of people who are able to “pick” (dart board style) a speculative winner.

    You can’t seriously call it ADVICE when it will not work for 99.99995% of the people.

  38. I partly agree but at the same time if you read the whole article, he makes a few good points. I worked at H&R Block this past season and had so many clients come in who researched and bought and sold stocks and in the end they were maybe $300 ahead after commissions which under short term gains taxes brought it to $225 net income.

    The article makes a good argument on a return on time – if you find an index fund put your money into it and just stick with it, as the market does grow over the years – it’s probably fine. But if you spend hours every month researching News Corp. or Intel and make 20% on your $2000 after commissions and taxes you’ll maybe be $300 ahead and you could probably make more than that with an APP-O-RAMA and spending less time and no risk.

    Finally, yes the comment about saving isn’t the best but at the same time I don’t see much difference between allocation $100 to have fun with friends at a casino craps table vs. buying 30 shares of some three-dollars stock + commission and hoping the stock shoots up ten times in value due to some random news reports.

  39. There’s a reason why he says “don’t save! spend all your money now”. He leaves out the part where “Daddy” bails him out.

    Have you read some of his other articles? You can tell he has never had to work a single day in his life. On top of that, it takes him 6 whole pages to get a single point across (which I could sum up in a whole sentence!).

  40. I agree, after reading some of the articles it’s just the tone of them all. Some of the advice could theoretically be acceptable, like advice against not enjoying life at all, if packaged correctly in a thoughtful manner.

    It’s like he really thinks all other 20-somethings are just like him and have a trust fund or something.

  41. I watched the video. I wonder if he is being entirely sarcastic with his approach to personal finance and spending as a means to educate the public as a reporter/commentator or whatever he is.

  42. Joseph Sangl says

    I think I will stick to being debt-free, investing every single month, and increasing my net asset base …

  43. That guy is a genius!

    I can’t wait to read his next articles… “Stealing to get ahead”, “The Lottery.. the cool kids retirement plan” and “Building wealth by spilling hot coffee in your lap and suing Starbucks “.

  44. all I can say is OMFG!!!!! As someone who is in their mid to late 20’s, I can’t believe he is advocating this crap. While the ratio of stocks to bonds the other person was advocating is a little too conservative (in my opinion), for someone in their 20’s (I think it should be more like 80/20)….the whole not saving, only invest in small cap growth is complete crap. His arugment that you need to in order to reach returns of 10% a year??!?!?! Get a fund that tracks the S&P 500, and you’ll likely get that over 30 years, and it will be a low cost, low homework decision. Geez, what is this guy thinking?!?!

  45. Matthias Muenzer says

    I agree with all my previous commenters on the power of compounding.
    In addition, people should look into investing in index funds, whihc I believe to be the easiest and best way to invest. I like the book of L. Swedroe “the only winning investment strategy you will ever need” about the topic.
    He describes that you simply cannot beat the market long term adn that all the hoopla in the media about stock picking is nonsense adn just keeps the commentators and people like Cramer in business, but that it is not to the consumers benefit.

  46. Did you catch the other one? You don’t need an emergency fund because you have mom and dad? This kid must live in a bubble full of trust funds. Then again, I guess there is no emergency when somebody else cuts checks for you, thus no need for emergency fund. Brilliant plan!

  47. I read Jonathan’s review and everyone’s comments before I read the actual article. I saw “The Street” and “Jim Cramer’s Nephew” and assumed this kid’s trying to be a financial writer but spouted some serious BS that will end that dream quickly.

    But to me, the actual article read more like an extra-fluffy opinion piece intended for 20-something readers than financial advice. I can imagine such an article appearing as an op-ed in my old college newspaper. I don’t think he has his sights on being a financial writer either – probably is only at “The Street” to take the opportunity provided by his famous uncle. He admits: “Those of you who read my earlier columns might be surprised that I’m taking any kind of position on investing.”

    One thing that really stands out: He dismisses the possibility of relevant diversification for those on a shoestring budget without acknowledging the existence of mutual funds and ETF’s, as if buying individual stocks are the ONLY way to invest. I suppose this is to be expected of Cramer’s nephew.

  48. OMG! I can’t believe this kid is for real! His writings are absurd! Encouraging to never save, gamble & hit up your parents! Wow! His posts are EXTREMELY embarassing! Not only to think this way but to post it!?!?

  49. Well thinks for sharing that interesting tidbit.

    The rest of his articles were about how not to save money because mom and dad will bail you out (doesn’t that speak volumes?).

    He also had an article about what he learned being on his own for a few weeks (drink fluids? pay your electric bill? Do you have to be out on your own to learn this??????).

    Thanks for the entertainment. Surely this guy can’t be for real. I was so sucked in I did some more web searches on the guy and saw a lot of defending that he is just a young guy – only 23. The difference from where this guy is to me at 23 is night and day. As many other young people have noted. Frankly, it’s insulting. IF he was 18 I might give him a little more leeway. But he’s 23!

    But what do I know? I am one of those people who sacrificed in my 20s and has lived quite well since about 25. Means I won’t be paying debt for the rest of my life, I don’t have to save as much because power of compounding is on my side, and on and on and on. Saving young has made ALL The difference in my life. It’s rather cushy if you ask me. But it doesn’t include Ipods and luxury cars either (nor do I See the point). But I have time for my kids and at 30 we don’t have to work very much to pay the bills. Yeah, what do I know? Like I will ever regret not spending money like water when I Was younger. ??? I don’t want for anything. I know too many people who pulled themselves up from poverty by their own bootstraps to take this guy seriously at all. What a spoiled brat.

  50. Much to the current dismay of my parents, I have chosen to live in an inexpensive apartment in a less than desirable neighborhood. I could easily live somewhere swanky, but I choose to save the difference in rent. My decision allows me to save over 30% of every paycheck. I allocate my savings into an IRA and a money market. In a couple of years, I will have enough money to buy a nice home without PMI. The sacrifice I am currently making will reap much higher rewards in the future.

    My advice: Your checking account should have in it as little money as possible to pay your bills and live comfortably and your savings accounts should grow exponentially!

    My tools: I use MS Money to report on my spending habits and project my cash flow. I meticulously enter all of my financial data. It only takes 20min a week. Nothing excites me more than seeing my net worth climb!

  51. At first, I was shocked by Jim Cramer, and I’m sure many others would be as well. But I remembered that Adam said “Jim Cramer gives Cliff Mason a pretty hard time in a couple of the videos on the site about these controversial topics.” So then I’m thinking Jim Cramer probably thinks he’s an idiot for having these opinions about money, but Mason didn’t believe him, thinking he knows everything and what do his parents (and uncles) know? So he gives him a job writing about his theories, thinking that if hundreds of strangers email him and post comments about how stupid his ideas are and why, he will finally see the light. So maybe he wasn’t just “giving his nephew a job”. Good way to teach Mason, but what if 10 other people saw this advice and acted on it? Pretty dire consequences!

    Of course, Mason’s reasoning is that if you invest only $2000 a year then you’ll only make $200. But of course, in those early years, the benefit is not the hundreds of dollars you make, but rather retaining the original contribution so that you earn more annually a few years down the line.

    Naturally, you have to start sometime. If you don’t start when you’re young, then at 30 years old you’ll still only have one year of contributions earnings interest – so I suppose the earnings that year wouldn’t be worth it either. Better postpone the investing another year or two…until you have a larger account balance…which will never happen…because you never put anything in.

  52. I’d like to believe that this guy is playing the devil’s advocate OR just trying to get coverage, but the result is that some people might take the poor advice and the negative publicity causes the street to lose credibility.
    Saving 2k a year, adjusting the savings for 2.5% inflation, assuming a linear gain of 10% each year, reducing the gains by 15% for taxes, and computing the inflation adjusted result gives the following:
    1. If you start at 21 then at 75 you’ll have just over a million dollars.
    2. If you wait until 31 then at 75 you’ll have just over a half million.
    3. if you wait until 41 then at 75 you’ll have a little over a quarter million.
    Of course this would be more if you put the money in a ROTH or a conventional IRA and even more if you put the money in a 401k with some employer matching.

  53. I came across this blog after Googling Cliff Mason. Why did I Google him? Because of this trash:

    Who hired this idiot?

  54. Thanks for citing this example of bad financial advice. Taking financial advice should be from someone who has experience in aiding in steadily growing wealth through multiple types of investments. Good post.

  55. Avoiding those who can’t back up any educational or work-related experience may be a good way to not waste investment dollars. Thanks for posting this.

Speak Your Mind