Jim Cramer: 7 Things He Won’t Waste Money On

Crystal Mayer
JStone / Shutterstock.com
JStone / Shutterstock.com

Jim Cramer is a well-known television personality as the host of CNBC’s “Mad Money” and creator of the CNBC Investing Club. His financial advice has resonated with millions of Americans hoping to find wealth through investing. He is outspoken about the need to be frugal and how people should save money in order to invest.

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As GOBankingRates previously reported, Cramer is a former hedge fund manager whose net worth is estimated at around $150 million. He started gaining wealth early, becoming a millionaire at just 28 years old. His recommendations for getting rich, however, aren’t limited to just investing. He also says you need to be careful how you spend your money. Here are seven things he won’t waste money on — that you might want to consider as well.

Discretionary Items

Cramer recently explained that younger people should learn to be more frugal. He noted that Generation Z spends an exorbitant amount of money on nonessentials and then complains that they have no money to invest. His recommendations include taking the money that would normally be spent on after-work drinks and investing it. Even just a few dollars can go a long way.

Individuals struggling with where to start should prioritize spending based on what is important to them. If a person can opt not to go to the movies, they can invest the money that they were going to spend at the theater. Over time these investments add up and, if done correctly, could mean a huge payout. Frugality, however, shouldn’t end once you’ve stopped living paycheck to paycheck. Cramer continues to be a cautious spender, even with millions to his name.

Expensive Hotel Rooms

Known for his frugality, Jim Cramer doesn’t mind sleeping in a less-than-luxurious hotel room. According to CNBC’s Make It, he says one thing he won’t waste money on is an expensive hotel room that he doesn’t spend a lot of time in. He encourages people to define their priorities for a trip and to use that to decide how expensive the room should be. If you are only going to sleep in the room, there is no need to break the bank for the accommodations.

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Name-Brand Products

He also explains to CNBC’s Make It that being a snob when it comes to name brands isn’t worth it. Cramer happily shops at Costco, purchasing their Kirkland brand. Generic doesn’t scare him since it is usually almost identical to its name-brand counterpart. The only difference is the price tag. Therefore, he recommends buying the less expensive store brand if the quality is the same.

Stocks of Lower-Quality Companies

One of Jim Cramer’s key pieces of investing advice is to buy into quality companies. He encourages people not to be afraid to “pay up for best-of-breed stocks.” Buying the stock of lower-quality companies can ultimately “blow up in your face,” so it may be worth the “higher price-to-earnings multiples” to invest in higher-quality stocks.

Tobacco Stocks

While he once advocated investing in tobacco stocks, he has since changed his tune. He explained to CNBC, “I think tobacco is wrong. It’s killed a lot of people. It killed my late father-in-law.” Therefore, he no longer recommends investing in the stock. One of his most common themes is investing in companies you believe in with a quality product.

Alcohol at Restaurants

The huge markup at restaurants is one of the reasons Jim Cramer refuses to waste money on alcohol while dining out. Liquor can be marked up 20% to 30% at restaurants, meaning you are paying a premium for the same drink you could make at home for substantially less. In addition to his television show, Cramer is a restauranter. He and his wife own a restaurant in Brooklyn.

Expensive Sports Tickets

Finally, Cramer says he doesn’t spend money on expensive sports tickets. He just doesn’t find it necessary. Since he enjoys simply attending the game, he doesn’t find it necessary to buy an overpriced seat. He does note one critical exception: football tickets. Cramer is a “huge Eagles fan” and is known to splurge on luxury box seats for games.

Living like Jim Cramer doesn’t have to be hard. Many of his financial recommendations come down to not spending beyond your means and investing any discretionary income that is left over each paycheck. With a little discipline, even people who think they do not have any leftover money can find a few dollars to invest. Living paycheck to paycheck may not have to be a long-term reality if you are willing to make a few sacrifices.

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This article originally appeared on GOBankingRates.com: Jim Cramer: 7 Things He Won’t Waste Money On

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