7 signs you are a Clark Smart investor (9 7 25)

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Are you truly building wealth the smart way? You might be following Clark's advice, but here's a chance to find out if you're a Clark Smart Investor. We're revealing the seven key signs that you're embodying his investment philosophy, from living below your means to avoiding costly mistakes.

Here’s what we’re covering in today’s Clark Smart Investing newsletter:

• Signs you are a Clark Smart Investor

• Insurance policies you absolutely do (and don’t) need

• How two annuities (that Clark actually likes) can reduce retirement stress

• Can you — and should you — coast into retirement?

• Q&A: Does a whole life insurance policy EVER make sense?

• Smart money move of the week: Check your credit report

💵 7 Signs You Are a Clark Smart Investor

You've been listening to Clark's advice, reading our content, and following our money-saving tips. But are you putting it all together when it comes to investing? Here are the key signs that you're truly embodying Clark's investment philosophy and building wealth the smart way.

1. You Live Below Your Means

This is Clark's core principle, and if you aren't doing this, it needs to be your top priority. Clark Smart Investors understand that you can't invest what you don't have, and you can't build wealth if you're spending everything you earn.

Living below your means isn't about depriving yourself – it's about making intentional choices with your money. You've learned to distinguish between wants and needs, and you consistently spend less than you earn. This creates the foundation for everything else in your financial life. Without this habit, no investment strategy in the world can help you build lasting wealth.

Clark Smart Investors have mastered the art of finding value in their spending while still enjoying life. You comparison shop, use coupons when they make sense, and avoid lifestyle inflation when your income increases. Most importantly, you automatically save and invest the difference between what you earn and what you spend.

2. You Dollar Cost Average — and Don't Stop

If you have a 401(k), you use it. Clark Smart Investors start by at least getting the company match — after all, it's free money. But you don't stop there. You understand that consistent, automated investing through dollar cost averaging is one of the most powerful wealth-building tools available.

Market timing is a fool's game, and you know it. Instead of trying to predict market movements, you consistently invest the same amount each pay period, regardless of whether the market is up, down, or sideways. This disciplined approach helps smooth out market volatility over time and removes emotion from your investment decisions.

You've set up automatic contributions from your paycheck directly into your retirement accounts. When markets crash, you don't panic and stop contributing – you understand that you're buying more shares when prices are lower, which will benefit you in the long run.

3. You Avoid High Cost Investments

Clark Smart Investors are obsessed with keeping investment costs ultra-low. You gravitate toward ETFs and low-cost index funds, and you've likely moved your money to one of the big three low-cost providers: Vanguard, Fidelity, or Schwab.

You understand that paying high fees is like having a hole in your investment bucket. Every dollar paid in unnecessary management fees, sales charges, and expense ratios is a dollar that can't compound over decades.

Wall Street makes money on complexity and high fees, but you make money on simplicity and low costs. You've learned that low-cost index funds consistently outperform expensive actively managed funds over the long term, and you're not paying premium prices for inferior results.

4. You Roth Everything You Can

Clark refers to himself as "The Man From Roth," and Clark Smart Investors have embraced this philosophy wholeheartedly. You understand the incredible power of tax-free growth and tax-free withdrawals in retirement.

👉️ Learn more: How to open a Roth IRA

You maximize Roth IRA contributions when eligible, and if your employer offers a Roth 401(k) option, you choose that, especially if you're young or in a lower tax bracket. You think strategically about your tax situation both now and in retirement, understanding that paying taxes upfront can be incredibly valuable when your investments have decades to grow tax-free.

👉️ Tip: Use this calculator to see how much your Roth IRA can grow

You've done the math and realize that tax-free income in retirement provides flexibility and potentially significant savings, especially if tax rates rise in the future. The Roth strategy gives you more control over your tax situation in your golden years.

5. You Diversify Your Portfolio

Clark Smart Investors don't put all their eggs in one basket. You understand the importance of diversification across different asset classes and geographic regions. Your portfolio includes both domestic and international stocks, providing exposure to global economic growth.

You maintain an appropriate mix of stocks and bonds based on your age and risk tolerance. You understand that stocks provide growth potential while bonds offer stability and income. As you approach retirement, you gradually shift toward a more conservative allocation.

For many Clark Smart Investors, target date funds serve as your "easy button" – but only in retirement accounts. These funds automatically adjust your asset allocation as you age, making investing simple and hands-off. They provide instant diversification and professional rebalancing without the complexity of managing multiple funds yourself.

6. You Never Panic — Think in Decades, Not Days

Perhaps the most important characteristic of Clark Smart Investors is your long-term perspective. You don't check your investment balances obsessively, and you certainly don't make investment decisions based on daily market movements or scary financial media headlines.

You've internalized the truth that the stock market's short-term volatility is the price of admission for long-term wealth building. When markets crash, you remain calm because your investment horizon extends far beyond the current crisis. You understand that market downturns are temporary, but time in the market creates permanent wealth.

You think in decades, not days. This perspective allows you to ride out market volatility, continue investing during downturns, and benefit from the long-term upward trajectory of the stock market. You know that your wealth will be built over years and decades of consistent investing, not through daily trading or market timing.

7. You Know the Clark Smart Investing “Don’ts”

Clark is famous not only for what he recommends, but also for what he warns you to avoid at all costs. Two of his strongest cautions are worth repeating:

These institutions often push products that sound safe but come loaded with high fees, commissions, and limited growth potential. Whether it’s bank-sold mutual funds or insurance-based investment schemes, Clark sees these as traps that benefit the institution far more than they benefit you. Clark Smart Investors keep their money far away from these “in-house” products and instead choose low-cost, independent investment options.

Clark has been consistent for decades: sales commissions create conflicts of interest. A broker or salesperson who earns money by steering you into certain products can’t always put your interests first. Instead, Clark advises handling investments yourself through low-cost providers — or, if you want help, working with a fee-only fiduciary advisor who is legally required to act in your best interest.

By steering clear of banks, insurance companies, and commissioned salespeople, you keep more of your money working for you instead of lining someone else’s pocket.

The Clark Smart Difference

Being a Clark Smart Investor isn't about getting rich quick or beating the market. It's about building wealth steadily and reliably over time while avoiding the costly mistakes that derail so many people's financial futures. These investors understand that personal finance is more personal than finance – it's about behavior, discipline, and playing the long game.

If you recognize yourself in these seven signs, congratulations – you're well on your way to building lasting wealth the Clark Howard way. Keep living below your means, stay consistent with your investing, keep costs low, maximize your Roth opportunities, stay diversified, and maintain that long-term perspective.

Remember Clark's approach: it's not about timing the market, but time in the market that builds real wealth. Stay disciplined, keep it simple, and let compound growth work its magic over the decades ahead.

📚️ Recommended Reading

💬 Ask an Advisor

In this recurring Q&A, we share questions that have been answered by Clark Howard or Wes Moss on the podcast. Submit your question today!

James in Georgia asks: Is there ANY scenario in which it is a good idea to purchase whole or variable life insurance? Clark is generally a big "Never, Not Ever" on this topic yet there is still an entire industry around these products (and it can't be a 100% scam). Are there any situations in which this makes sense?

Wes Moss says: You’re right, it’s a giant industry. There are some reasons you would do this. Imagine you have a $58 million property. The estate exemption right now is $14 million per person, so $28 million for a couple. After the estate settles, that’s $30 million over the exemption limit. What are the taxes on that? Well, 40% of $30 million is $12 million. Does the family have $12 million to pay the taxes? You have a great net worth but not enough liquidity. A whole life policy is designed to fund the taxes to keep the property. That is a great example of why whole life still holds a place. But this is for a small percentage. Buying/selling a business is another example of where this makes sense. Having a guaranteed amount of money coming in if you have a child with a disability is another example. However, most of these things can be funded with term life insurance and it is so much less expensive. But the industry has its place and I want to give it credit.

💸 Money Tip of the Week

☎️ Need Money Help?

The Team Clark Consumer Action Center is a free helpline that can help you navigate your money questions. Call 636-492-5275. Visit clark.com/cac for more information.

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