‘I was advantaged because I didn't have money to fall back on’: Billionaire David Rubenstein explains why and where to invest for different age groups

Started from the bottom

In the interview, Rubenstein shared that he didn’t actually enjoy practicing law. He felt because he didn’t enjoy it, he wasn’t good at it. He said, “If you are going to be great at something, you have to love it.”

So, he quit law and in 1987 took a gamble by starting The Carlyle Group. He recruited people with financial experience, and a friend of his helped him raise $5 million to get the business off the ground. Today, the company manages nearly $400 billion. It’s safe to say that the risk paid off.

Rubenstein’s success has proved to be an inspiration for many, especially since he had humble beginnings. His father worked at the post office as a file clerk until his retirement at 55. Rubenstein thinks his background probably motivated him. "Because when you don't have money you have to work harder, you have to do things for yourself. And so in hindsight I probably wasn't disadvantaged, I was advantaged because I didn't have money to fall back on, a father that was famous or able to help me open doors," he said.

At one point in the interview, Kullberg asked Rubenstein how he manages to maintain his humility. As a philanthropist, Rubenstein has given away a lot of money but he laughs at her question and points out that one could argue that he’s not that humble because even though he gives away his money, he still gets his name put on buildings. “I put my name on buildings in part to tell people, ‘you too can do this,’” he said.

So, how can you do it? Rubenstein shares the following tips for those looking to invest.

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Advice for Investing

For the retail or amateur investor, Rubenstein suggests index funds. He points out that the average person doesn’t have the time to follow and track the stock market while keeping up with their job. He advises leaving that to the professionals and choosing index funds so you can focus on your own daily life. Just make sure to choose wisely. He advised doing your research by looking at factors like the fund manager's track records, fees, the stability of the organization, whether information is given out on a timely basis, and whether the investment choices align with your personal values.

For those in their 20s, Rubenstein suggests worrying less about retirement and instead concentrating on learning about the investing world. There is a lack of financial education and literacy, so this is the time to learn about money and take some bolder risks.

When people get to their 30s, they then tend to have families and young children and need to be more risk-averse. He added that your asset allocation should suit your net worth and income. If you're not going to make a lot of money in your line of work, it's smarter to be risk-averse and choose safer assets.

“But remember,” he said. “The most important rule about investing is don’t lose what you have.”

He also emphasized that to be successful, you need to know where your money is and what it is doing. He said, “Make sure you know as much about what you're putting your money into as your profession.”

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