Americans lost more money to fraud last year than in any year on record. What’s striking isn’t the creativity of the schemes. It’s how few of them there really are, and how reliably the same handful of moves keep working.

Here’s a look at the most common ways in which Americans are getting scammed.

Subscribe now

The Biggest Number Ever

The FBI’s 2025 Internet Crime Report logged $20.9 billion in reported losses, up 26% from the year before. Complaints topped 1 million for the first time, roughly 3,000 a day.

Investment fraud drove the biggest share at $8.6 billion, followed by business email compromise at $3 billion. Together those two categories accounted for more than half of everything lost.

The FTC’s separate consumer data tells a parallel story: about $15.9 billion in reported fraud losses in 2025, the highest ever, from 3 million reports. Both agencies say the real number is much larger, because most people never report.

They’re too embarrassed by what’s happened.

Older Adults Are Getting Hit Hardest

Americans over 60 reported $7.7 billion in losses to the FBI, up 37% in a single year.

The FTC data adds a wrinkle worth understanding. Younger people report losing money more often, but they lose less. The median loss for someone under 20 was $189. For someone over 80, it was $1,650. Younger victims get nicked. Older victims get cleaned out.

If you have a parent or grandparent managing money on their own, please help them understand how this fraud happens and how they can protect themselves.

AI Shows Up in the Data for the First Time

The FBI tracked AI-related crime as its own category in 2025 and immediately logged 22,364 complaints and nearly $893 million in losses.

And, that’s just the first year of reporting.

Think about it. With a few seconds of video or audio, which most of us have posted publicly without thinking about it, someone can create an AI bot that looks and sounds exactly like you. The scammer can live behind a computer somewhere and type in the words the AI bot will say and it will look and sound like you’re saying it.

If you think asking ChatGPT or Claude for advice on your finances is scary, this type of financial crime should terrify you.

Leave a comment

Share

The 15 Most Common Frauds and Scams

Every one of these scams follows the same playbook. Someone contacts you, establishes credibility, scares you, and then moves you toward a transaction that’s hard or impossible to reverse.

Investment and crypto scams. Fake platforms, Ponzi structures, and “pig butchering,” where criminals build trust online for weeks before pitching a bogus high-yield asset. It’s an old story that’s been going on for decades because they work. These scams continue to produce the single biggest win for scammers on the list.

Bank and government imposter scams. You get a call or text from your “fraud department,” the IRS, or the Social Security Administration. They tell you that you have to transfer money to them outside of your bank in order to keep it safe because the bank itself is compromised. Bank impersonators produced the highest losses of any business impostor last year.

AI deepfake voice scams. Cloned audio of a family member or a company executive authorizing an emergency wire. How does it play out? You get a call from your nephew or niece or a friend who says they lost their wallet somewhere (Greece, Oklahoma, New York, etc.) and need an immediate transfer of $1,000 to $10,000 so they can get home.

Phishing and smishing. Fake links about unpaid tolls, package deliveries, and locked accounts that come in emails and texts. This is still the most reported complaint type, at about 19% of everything filed with the FBI.

Online shopping fraud. Fake storefronts and social media ads sell amazing-looking goods that never arrive.

Employment scams. Work-from-home offers that require you to pay for equipment upfront or deposit a check that later bounces. I get several of these every week. (I also get offers to fund my business and get me out of debt. Yesterday’s call offered me $48,750 to clear all of my debts. Whoo hoo!)

Romance scams. Lonely, usually older, people are catfished with months of cultivated intimacy. Suddenly, the virtual love of your life then has an emergency that only cash can solve. So, you hand it over without even thinking. The initial dribble soon turns into waterfall and your entire account or retirement disappears. And, when there’s no more money, the love of your life disappears, too.

QR code quishing. Malicious codes are stuck over real parking meters, restaurant menus, and payment portals. When it comes time to pay, you’re not paying the city, restaurant or business. You’re dumping money into some offshore account.

Tech support scams. A pop-up says your computer is infected. The fix costs hundreds and does nothing. This was the third-largest loss category in the FBI data. If you think this could never happen to you, it happened to my mother years ago. Fortunately, she only lost a few hundred dollars. Not the end of the world to her (and then we completely wiped her technology) but imaging how much money this scoops up if you multiply it times 10,000 or 100,000 people.

Grandparent scams. A caller pretends to be a grandchild in sudden legal or medical trouble, usually late at night, always urgent. This is now often combined with AI. You should develop a safe word or phrase to use with your close relatives. Don’t disclose it but if you get one of these calls, you should ask the caller what the safe word is before you do anything else. This also happened to my mother, who was able to tell immediately that it wasn’t her beloved grandson.

Fake payment app refunds. Money arrives “by accident” through Zelle or PayPal. You think, “Yay!” Then, the sender demands you return it. The original transfer reverses, leaving you out of pocket by the same amount.

Charity scams. Fake nonprofits solicit millions of individuals right after a natural disaster or during year-end giving. Of course, it happens year-round as well. I’m seeing scams from fraudsters pretending to be food pantries, which are in dire need of funds at the moment.

Mortgage closing wire fraud. Hackers sit inside a real estate email thread and send revised wire instructions days before closing. People lose entire down payments this way. No one in the business truly understands how they get inside. But, I had a very sophisticated friend whose business lost more than $200,000 in a similar scam.

Credit repair and debt relief. The scammer wants to charge you upfront fees to erase legitimate debt or wipe accurate credit history. Neither is possible.

Lottery and prize scams. You’ve won! Now you’re asked to cover the taxes and processing fees first.

Subscribe now

How Can You Protect Yourself?

Awareness isn’t enough, because these scams are designed to work on people who already know they exist. Friction is what protects you.

Never move money to “protect” it. This is the single most important thing to know. No bank, no federal agency, no fraud department will ever ask you to transfer funds to a safe account. That request is the scam, every time.

Hang up and call back. Don’t call the number that called you, and don’t call the number in the email. Use the one on the back of your card or on the agency’s website.

Verify wire instructions by phone before every closing. Call the title company at a number you looked up yourself, not one from the email. Do it even if the instructions look identical to the last set. One number could be off and your money will disappear forever.

Pick a family code word. One word or phrase, agreed on now, that only a real relative in real trouble would know. It costs nothing and it defeats voice cloning.

Freeze your credit at all three bureaus. Free, reversible in minutes, and it blocks the downstream damage when your information does leak. Which it probably will.

Finally, if it happens to you, report it. The FBI takes complaints at ic3.gov and the FTC at reportfraud.ftc.gov. Fast reporting occasionally recovers wired funds, and it’s the only reason we have these numbers at all.

One more thing: nobody falls for a scam because they’re foolish. They fall for it because a professional caught them on a bad day or at a bad moment with a story that fit.

Please share this post widely.

Share

Have you been targeted recently? Or, have you fallen for a scam? Hit reply and tell me what they tried. I’ll publish stories in a future post.

Leave a comment

— Ilyce

New to Love, Money + Real Estate? Read More

Three-quarters of Americans went looking for financial guidance last year. Where they went for that advice, and how much they trusted what they found, turns out to be two very different things.

Subscribe now

Be Skeptical of Finfluencers

The Wall Street Journal recently reviewed more than 50 hours of content from online financial advice-givers and found that platforms like TikTok and Facebook are increasingly shaping how people educate themselves and manage their money.

The problem isn’t only the advice. It’s how it affects people in ways we don’t understand. The Financial Industry Regulatory Authority (FINRA) found that people who follow finfluencers rate their own investment knowledge highly, but score worse on objective knowledge tests. They also report more susceptibility to investment fraud.

That’s not proof that watching finance videos gets you scammed. However, confidence that outruns knowledge is exactly the condition a con artist is looking for. And, most of the people making these videos are selling something. (It’s always about the monetization strategy.)

Where People Actually Go

The 2026 Money and Meaning study from Gallup and Edward Jones asked where Americans and Canadians turn for financial guidance. Three-quarters of Americans and nearly seven in 10 Canadians sought it from at least one source in the past year.

Among Americans who went looking, 73% used their own internet research, more than any other source. Family members came next at 35%, professional financial advisors at 32%, news and social media at 26%, and friends at 23%.

Just 18% asked an AI tool like Claude or ChatGPT.

And Who They Actually Trust

Here’s the disconnect: Fewer than three in 10 Americans have at least some confidence in AI for financial guidance, and only 3% have a great deal of confidence in the information they get. Meanwhile 79% have at least some confidence in financial advisors, the source they trust most and use third-most.

So the vast majority of people trust people over AI, even as they’re using AI more often. How much more often is the question.

Other Research Says AI Usage Is Even Higher

A 2025 J.D. Power report found more than half of U.S. consumers had used AI for financial advice, with 13% using it daily. A 2026 working paper from MIT Sloan School of Management assistant professor Taha Choukhmane found that more than half of adults in the U.S. and U.K. have asked AI for financial guidance, likely more than the share who consult a human advisor.

The gap between 18% and 50% probably comes down to how the question was phrased. “Do you use AI for financial advice?” and “Have you ever asked ChatGPT a money question?” are not the same question, and a lot of people answer no to the first and yes to the second.

Is AI’s Financial Advice Any Good?

Choukhmane and his co-authors set out to measure exactly that. They collected real financial question prompts from about 1,000 adults, then simulated decades of following the resulting advice under realistic market and job conditions.

Mostly, it held up. The AIs consistently told people to save during their working years, diversify into stock funds, draw down in retirement, and reduce stock exposure after 45. Simulated wealth topped $1 million by retirement in many cases. The models were weaker at handling shocks like job loss, and they let portfolios drift instead of rebalancing. (People do that, too, by the way.)

“Generative AI has real potential to improve access to financial advice,” Choukhmane said. He’s careful to add that the benefit isn’t evenly distributed. Prompts written by men, and by people already comfortable with AI, produced more aggressive recommendations and higher simulated wealth.

Which is interesting as so much research over the years finds that male investors are much more likely to pay attention to watercooler financial gossip and be more aggressive with their money than female investors.

When it comes to AI, prompts are the most important part: What you get out depends enormously on what you put in.

How I Use AI on My Own Money

I’ve spent a lifetime writing about money and my husband and I managed our own funds from the beginning, although we now also have a Registered Investment Advisor helping us. My tracking has moved through every technology available.

I started at 21, with a notebook. I used it while I was studying abroad and I still have it. Bonus: it helps me remember everything I did that year. When computers became a thing, we moved to Quicken for expenses and Excel for net worth. Then TurboTax. When the businesses got more complicated, QuickBooks.

Now I use AI to ask financial questions almost daily. (I use it constantly during the day for all sorts of other projects I’m working on.)

Do I know enough to answer most of these questions myself? Probably. But the conversation I’ve built remembers every number I’ve ever entered. I can go back, update figures, and have it rerun the entire plan in seconds.

What have I asked?

I’ve asked about drawdown strategies, whether a Roth conversion makes sense, and how the portfolio holds up under 4% or 5% inflation. I had it run a Monte Carlo simulation, which models thousands of random market paths to show a range of outcomes rather than one tidy assumption. I asked whether higher inflation or weaker returns would leave me broke.

I got answers that made me happy: No, I won’t go broke. Yes, there are drawdown strategies that will preserve wealth even in an era of higher inflation and crazy stock market swings.

But the real value wasn’t the answer. It was the back and forth conversation, which helped me understand my own numbers better and think through what to do next. It’s reassuring to know the retirement I’ve planned can absorb that much stress.

And, I think we can all agree on one thing: These are stressful times.

What I Never Type Into AI

Which brings up the question I get most: aren’t you worried about your personal information being out there?

I never put in personally identifiable information. No account numbers, no Social Security numbers, no EINs, no addresses. Not once. I use round numbers and relative figures, and that’s plenty for the math to work.

Partly that’s about the platform I use, which is Anthropic. On Anthropic’s consumer plans, chats stay in your account until you delete them, and deleted conversations come out of back-end storage within 30 days. If you’ve turned on the setting that lets your chats help improve the model, they can be retained in de-identified form for up to five years. You can check that in your privacy settings, but business plans operate under separate terms. Every AI company handles this differently, so read the policy for whichever tool you use.

Mostly, though, it’s just financial and cybersecurity hygiene. Don’t ever hand over identifying details you wouldn’t want sitting in a database somewhere. Because they probably are.

Subscribe now

Which Way Should You Go?

None of this means you should skip using a Registered Investment Adviser (RIA) or a Certified Financial Planner (CFP). They can be genuinely helpful, especially in complicated situations where one wrong move could change a lifetime of saving.

The problem is, using a professional costs money, sometimes a lot of it, and if you have one or two questions, some may want you to sign on as a client and hand over your accounts before they’ll give you a real answer. Or, they’ll want several thousand dollars and the first appointment available is a month down the line when you need a question answered immediately.

The nice thing about AI is it’s there for you, 24/7, when you a question or worry is keeping you up late at night.

So here’s my take. Use AI the way you’d use a very well-read friend who has read every personal finance book ever written and has no idea what happened to you last Tuesday. It’s good on structure, math, and tradeoffs. It doesn’t know your marriage, your health, or your risk tolerance unless you tell it, and it has no fiduciary duty to you at all. Good AIs will remind you of that every time you ask a question.

Whoever you listen to, check them out before you buy anything, sign up for anything, or trade on their advice. That goes for the guy on TikTok, the advisor with the nice office, and the chatbot.

Disclosure: Just to be really clear, I use Claude regularly and am building a financial education app that includes AI coaching. Neither company paid for or reviewed this piece.

How are you using AI for your money, if at all? Use the comment button below and let me know. And, feel free to share this post.

Leave a comment

Share

Thanks for reading.

Ilyce

Subscribe now

A basket of standard school supplies costs nearly 8% more than it did last August. Lunch boxes are up 26.8%. Notebooks, 23%.

Meanwhile, the average family with K-12 kids plans to spend $863.86 this season, according to the National Retail Federation. Last year it was $858.07.

That’s the $5.79. The problem is, it won’t be nearly enough.

Four straight years of planning to spend less

For the past few years, surveys have found that parents want to spend less on back-to-school supplies. But, it rarely works out that way.

While some surveys say parents plan to spend $5.79 less on school supplies, Deloitte puts the number even lower. Its 2026 Back-to-School Survey has parents planning to spend $557 per child, down $13 from last year. Adjusted for inflation, that’s 6% less. It’s the fourth straight year the figure has fallen.

And yet, something’s gotta give, and it isn’t the price tag. Parents end up shelling out because nobody’s negotiating a discount at, say, Target. They’re just putting fewer things in the cart.

One more data point on the mood: 57% of parents told Deloitte they expect the economy to get worse over the next six months, the highest reading in that survey since 2020. That isn’t a good sign and may well be a self-fulfilling prophecy.

Where the increases actually are

A joint analysis from Groundwork Collaborative and The Century Foundation found that a typical supply basket costs 7.7% more than a year ago, and typical school lunch items cost 10.9% more. The price data comes from actual school supply lists.

Those averages hide some tough numbers. Year over year:

• Lunch boxes: up 26.8%

• One-subject notebooks: up 23%

• Index cards: up 22.2%

• Notebook paper: up 20%

• Tissues: up 20%

• Sandwich bread: up 21.8%, to $4.36 a loaf

• Blueberries: up 48% (bad growing conditions plus fuel costs)

Add the packed lunches to the supplies and the researchers estimate the school year runs close to $4,000 per child, 10.7% more than last year.

If you have a kid who insists on a new lunch box every August, this is the year to make the case for the old one. In fact, how about switching to a paper bag? At Target, 100 count paper lunch bags cost $2.39.

Why paper and plastic got hit hardest

When it comes to paper and plastic items, there are two economic forces stacking on top of each other, pushing prices a lot higher.

Tariffs. The average effective U.S. tariff rate has gone from 2.3% in January 2025 to an estimated 6.6% for 2026, the highest since 1969, per the Tax Foundation’s tariff tracker. It estimates the tariffs announced and imposed work out to roughly $900 per household this year, on top of about $1,000 last year. Almost nothing on a school supply list is made here, so those costs land directly on the shelf. Newell Brands (Sharpie, Paper Mate, Elmer’s) raised prices repeatedly against a nine-figure tariff bill. ACCO Brands (Mead, Five Star, Trapper Keeper) did the same. Logitech told investors flatly that it took a sizable U.S. price increase.

Energy. The national average for regular gas hit $4.09 a gallon on July 23 and stayed there through July 30. As I write this, the price has ticket up a penny to $4.10 a gallon. That’s nearly a dollar higher than this time last year, with crude in the $80s and the Strait of Hormuz still unsettled. The June dip was real, but it tracked a pause in the Iran conflict that didn’t hold. Fuel doesn’t just show up at the pump. It shows up in freight, in fertilizer, and in the wholesale price of plastic, which is up about 20% since February. Every highlighter barrel and shrink-wrapped notebook pack carries a piece of that.

This isn’t a Target problem or a Walmart problem. It’s an input-cost problem, and switching stores won’t get you around it.

Share

Clothes and shoes: the slower burn

Apparel is the one category that hasn’t spiked the way paper and plastic have. Children’s footwear is up 4.7% over the past year. That’s the fastest pace in nearly four years, but nowhere near 26%. Carter’s, Vans, and Gap have all raised prices, and brands are clearly working to absorb the higher prices through their profit margin rather than shock shoppers.

NRF has families budgeting $293.11 for electronics, $250.29 for clothing and accessories, $174.01 for shoes, and $146.45 for actual school supplies. Supplies are the smallest line and the fastest-rising one, which is exactly why it slips past most families. Nobody comparison-shops a pack of index cards.

How parents are coping

Deloitte identifies a group it calls “hyper-value seekers,” the 31% of parents using four or more cost-cutting tactics. They spend about $610 per child, 14% more than everyone else. Value-seeking, it turns out, isn’t the same as spending less. It’s being deliberate about where the money goes. Half of all parents surveyed said they’re cutting back on dining out and entertainment to fund the school list.

Others are financing it. Intuit Credit Karma found that 45% of parents plan to take on debt for back-to-school shopping, up from 34% in 2024, and 57% are heading into the season already carrying credit card balances. A third are asking their kids to chip in their own money.

And some are simply saying no. NerdWallet’s annual survey found 37% of parents say their child will likely miss at least one school activity this year because of cost. Tariff policy is abstract right up until it’s a kid not doing band.

Four things I’d do

My kids are long past the years where we shopped their back-to-school supplies list. But, here’s what we did do to save money each year, and they’re still my best recommendations:

Shop online, list in hand. This is my number one. Wait for the teacher’s actual supply list, then buy it from Amazon, Target, or Walmart without setting foot in a store. You buy what’s on the list and nothing else. No endcap displays, no “while we’re here.” You can compare sale prices across all three in about four minutes, and shipping is free at most order sizes. At $4.10 a gallon, skipping two trips across town is real money before you’ve bought a single pencil.

Reuse the durable stuff. Backpacks, lunch boxes, and binders are where the biggest percentage increases are hiding. A backpack that survived one year will survive two, unless your kid has torn the shoulder staps off.

Budget a September or October line item. More than half of parents told Credit Karma they spent over $250 on school-related requests after school started, and 29% spent more than $500. That’s not an emergency. That’s a predictable expense showing up in the wrong month.

Take the price-freeze bundles seriously. Walmart is promoting a 14-item supply kit with a backpack for $16. Target held 2024 prices on a 20-item set under $20. When retailers eat the tariff to win your traffic, let them.

What is your best money-saving tip when it comes to back-to-school expenses? Hit the comment button below and share.

Leave a comment

When prices climb 8% and the money doesn’t, one of two things happens in every household: you spend more, or your kid gets less. Most families are quietly splitting the difference. The ones who plan the September spend now will feel it least.

What’s stretching your dollar the thinnest right now? I’d love to know and will include responses in a future note.

— Ilyce

Subscribe now

Read More Love, Money + Real Estate

Golden Handcuffs, Silver Lining

You Can Do 99 Things Right and Still Sink the Ship

We Earn $100k and Live Paycheck to Paycheck. How Do We Buy a New Car?

My Sister And I Each Inherited Over $1 Million. Now Her Recent Request Has Thrown Me for a Loop.

Subscribe now

Golden Handcuffs, Silver Linings

Here’s the strange state of the housing economy in one sentence: the industry’s pros are turning optimistic, prices are firming, and American homeowners are sitting on record wealth — but almost nobody can afford to touch any of it. The latest data tells the story of a market that’s healing and stuck at the same time.

The pros think we’ve turned a corner

RCLCO’s Mid-Year 2026 Sentiment Survey finds the industry’s Real Estate Market Index climbing to 52.13 — back into expansion territory after struggling to reach 40 through all of 2025. Nearly 60% of respondents (mostly C-suite veterans averaging almost 30 years in the business) expect conditions to improve over the next 12 months, three times the share expecting things to get worse. A quarter still see a recession within a year, and interest rates (73%) and inflation (63%) top the risk list — but when the people who’ve survived four cycles start positioning for recovery, pay attention.

Mortgage rates: better than last year, going nowhere fast

Freddie Mac’s weekly survey puts the 30-year fixed at 6.58% — up a touch from last week’s 6.55%, but below the 6.74% we saw a year ago. The 15-year sits at 5.96%. If you’ve been waiting for rates to plunge before you buy or refinance, the data keeps delivering the same unglamorous message: this is a grind, not a cliff dive. The move you can make today is to shop your rate — Freddie’s own research shows comparison shopping can save borrowers thousands over the life of the loan.

$17.9 trillion, mostly locked in the house

Cotality reports that mortgaged homeowners now hold $17.9 trillion in net equity — an average of $310,500 per borrower, roughly five times the level of 15 years ago. Only 1.9% of mortgaged homes are underwater, compared with a staggering 26% at the 2009 peak. But most of this wealth wears golden handcuffs: selling means trading a 3% mortgage for a 6.58% one, so people stay put. Instead, they’re borrowing against it — homeowners tapped $77.1 billion through home equity loans and HELOCs in the first quarter, up from $69.7 billion a year earlier. Just remember that equity isn’t cash until you access it, and a HELOC is still debt secured by your house.

Gen Z shows up — with the family checkbook

ICE’s July Mortgage Monitor shows home prices re-accelerating to 1.3% annual growth, the strongest in more than a year, with 72% of markets now above year-ago price levels. The more interesting number: Gen Z accounted for one in 5 purchase rate locks last quarter — a record — and 29% of all down payments now come from somewhere other than personal savings, the highest share in seven years. Among Gen Z buyers, 13% used a family gift and 8% used a loan. The first rung of the housing ladder increasingly runs through the Bank of Mom and Dad.

Nihilists or strategists? Turns out, both

The Urban Institute asked whether young adults are financial nihilists or savvy strategists, and the data says: yes. 65% of Gen Z respondents believe their generation faces tougher economic circumstances than the ones before it, and more than half say they must take bigger risks to get ahead. (For the record, every generation believes this.)

So they are — 22% have owned crypto, 21% trade individual stocks, 17% bet on sports. But 42% are also saving in retirement accounts, and 56% expect their finances to improve within a year. My take: the saving is the strategy; the speculating is fine only in amounts you can afford to lose completely.

The house keeps costing money after you buy it

New NAHB research answers a question every first-time buyer should ask: what do people spend after they move in? Buyers of newly built homes spend an average of $26,882 on appliances, furnishings, and remodeling in the first year — nearly triple the $9,457 that non-moving homeowners spend. Existing-home buyers average $18,673. If your homebuying budget ends at the closing table, it’s only half a budget. Price out year one before you bid.

Remodeling downshifts

Harvard’s Joint Center for Housing Studies expects remodeling spending growth to slow to just 0.5% year-over-year by mid-2027 — the third straight quarter of deceleration, with annual spending flattening around $519 billion. The culprit is the same lock-in dynamic running through this whole issue: home sales trigger renovation spending (see the NAHB numbers above), so when sales stall, the remodeling wave stalls with them. For homeowners, there’s a silver lining — a cooling market means contractors who actually return your calls, and more room to negotiate.

Living, not listing

And yet homeowners haven’t stopped investing in their homes — they’ve changed why. The 2026 Houzz Outdoor Trends Study finds only 15% of renovating homeowners are motivated by resale value, down 3 points, while 83% of renovated outdoor spaces now include a lounge or seating area and 71% of homeowners hired a pro — a record high, up from 65% in 2024. (Also: exterior beams jumped 24 percentage points in popularity, to 43%. I have questions.) When you can’t afford to move, you invest where you are. More on this study in an upcoming issue — it deserves a deeper look.

Share

Leave a comment

Thanks for reading. I’ll have more to say on this topic soon.

— Ilyce

Subscribe now

In journalism, one wrong number wipes out a year of good reporting. In business, one wrong partner wipes out a fortune. Excellence doesn’t average — it multiplies. And on the other side of the coin, so do mistakes.

Nobody told me that when I started my first business. Nobody told me most of what follows, actually — I learned it the way most entrepreneurs do, by paying tuition in mistakes, near-misses, and the occasional lucky break, over three decades of riding my own business roller coaster.

On the journalism side, I’ve interviewed thousands of developers, CEOs, founders, and homeowners. And, I’ve built a few businesses of my own (and sold two). The same lessons keep showing up, decade after decade. Here’s the list I wish I’d had on day one:

One mistake can sink the ship. Trust the wrong person, sign the wrong deal, skip the one bit of due diligence that mattered, and everything else you did right goes down with it. The fix isn’t paranoia — it’s knowing which decisions can’t be undone, and slowing way down for those.

Everything takes longer than you think it should. That’s true for building a business and for building houses or commercial buildings. You’ve got to piece together the land, line up the financing, assemble the team, and make sure you’re delivering the right product to the right market at the right moment. Any one of those can take a year longer than planned — and usually does. On the business side, selling takes more than one phone call. Sometimes, it’s a seven-year wait. Sometimes, the business can’t survive the sales cycle.

Patience isn’t a virtue in business. It’s a survival skill.

If you don’t have a strategy, you’ve got nothing. Hustle without direction is just expensive motion. The companies that survive downturns aren’t the flashiest — they’re the ones that knew exactly what they were building, for whom, and why, before the money got tight.

Your network is your most valuable resource. Journalists live and die by their sources, but so do business people. It’s true for everyone. The right phone call has saved more deals (and careers) than any spreadsheet ever will. The lesson here is simple: Invest in relationships before you need them. Nurture them throughout your entire career.

This year, I started a business with someone I met more than 10 years ago. One of our partners is someone I’ve been working with for 15 years. One of our channel partners is someone I’ve been doing business with for 25+ years. These are deep, rewarding relationships with people I know I can trust.

Cash is oxygen. Profit is an opinion; cash flow is a fact. Almost nobody goes under because they weren’t smart. They go under because they ran out of runway three months or three years before the market turned. I learned this lesson right before the Covid pandemic. Someone was about to offer me millions for my startup and I turned it down because we had a fantastic pipeline. Five months later, the pandemic started and my pipeline evaporated. I can’t tell you how many times I wish I’d had that cash in the bank.

The cycle always turns — and memory is short. Every boom convinces someone that this time is different. It never is. The people who do best are the ones who remember the last downturn while everyone else is celebrating.

You reputation compounds. Deals close and companies fold, but how you treated people follows you everywhere. Again, it goes back to relationships. Yours will be lasting if your reputation is stellar. It’s the one asset that appreciates in every market.

Hire people smarter than you. Always. If you’re the smartest person in every room at your company, you’ve built a company with a very low ceiling. I don’t care how smart you are. I don’t care if you think you’re the smartest person on the planet.

The best founders I’ve met through the years treated hiring like casting — they went out and found people who were better than they were at finance, at operations, at sales, at everything — and then got out of the way. It takes a certain confidence to surround yourself with people who could outshine you. It takes a certain foolishness not to.

That last one might be the master key to all the others. Smart people catch the mistake before it sinks the ship. They build the strategy, extend their network, watch the cash, and remember the last cycle.

You can’t do 99 things right by yourself — but you can hire the people who will.

Leave a comment

What’s the business lesson you wish someone had told you on day one? Hit reply and tell me. I read every note.

— Ilyce

Subscribe now

Dear Pay Dirt,

How should I pay for a new car? I was recently in an accident, and my vehicle was totaled. Insurance will pay for what we owe on the car, but not much beyond that. My husband and I make $100,000 a year, have four kids, own a home, and have one paid-off vehicle. We are proud of how far we’ve come, but we live paycheck to paycheck. Our only remaining debt is our mortgage and the note for this dearly departed car. We got a good deal on it a few years ago, and vehicle prices have gone up a lot since then. So we have two options:

1. Take a few grand out of our small ($8,000) emergency fund and finance the rest of a new vehicle. We’re looking at getting a used but relatively new van around $25,000.

2. Take about $15,000 out of our $100,000 retirement account and only finance around $10,000 of the new vehicle. This would keep our monthly payment in a more manageable range, but it feels short-sighted.

What are we overlooking?

—My First Car Cost $1,500

Share

Dear My First Car Cost $1,500,

Before I weigh in on your options, let me congratulate you on living a financially successful life while raising four kids. It’s certainly not easy, but while you’re living “paycheck to paycheck,” you’re also building your emergency fund and have put away something for retirement. I don’t know how old you are, but as the kids grow up and move out, you’ll have time to catch up on your retirement savings. Your immediate goal is to avoid taking on expensive debt.

That said, you need to immediately replace your car. The most important question I have for you is, what’s your credit score? That’s probably going to drive your decision.

Of the two options you provided, using cash from your emergency fund as a down payment while taking out a bigger loan may be your best bet. I know it feels counterintuitive to take out a bigger loan. But if your credit score is good, you’ll pay a reasonable amount of interest from a bank or credit union. And car dealers may even offer better financing deals than that.

Here’s how option two might play out: If you dip into your retirement account, you’ll pay tax on that withdrawal at your current marginal tax rate, which could be 20 percent or more, plus you’ll pay a 10 percent penalty and any state tax that’s owed. On your $15,000 withdrawal, you might have to withdraw an additional $4,500 (or pay for it separately). If your employer provides a way to borrow from your 401(k), you’ll avoid the taxes and penalties, which is better. While you’ll pay yourself back, rather than a lender, that cash will be missing from your account. So you’ll miss any growth you’d have had with those investments. But if your credit score isn’t great, or good enough for a lower-interest loan, and you can borrow from your 401(k), then that may be the better choice.

A third option would be to take out a home equity line of credit (HELOC). Again, if your credit score is high enough, you might qualify for a reasonably-priced loan of around 7 percent (at today’s interest rate). While you’ll need to pay that back, HELOCs are typically open for 10 years, which would give you another way to pay for emergencies without depleting your cash. Think of it as a backup emergency fund. If you don’t use the HELOC, you generally won’t pay anything other than a small fee when you open the account.

I’m still voting for option one, although I really like the idea of having an open HELOC. But it’s all going to come down to your credit score. To find out where yours is, sign up for a free online account at Experian, Equifax, and TransUnion. You’ll get a free credit report and your current credit score. You’ll also be able to easily freeze and unfreeze your credit, which puts you more in control of your financial future.

Read more Love, Money + Relationships

I’m About to Be a Professional Athlete—With the Paycheck to Go With It. My Dad Claims I “Owe” Him.

I Spent Years Working a Stressful Job in Exchange for a Life-Changing Amount of Money.

My Roommate Refused the Lottery Ticket I Bought Her. That Might’ve Been the Million Dollar Mistake of Her Life.

My Husband Just Dropped a Bomb About His Will. It’s Making Me Question Our Entire Marriage.

My Sister And I Each Inherited Over $1 Million. Now Her Recent Request Has Thrown Me for a Loop.

My family isn’t rich but I have $2 million in company stock. How much should I sell?

My Parents Have Made Some Horrible Financial Decisions.

I’m About to Give My Daughters a Lot of Money

I Suddenly Came Into a Large Sum of Money...

I Want to Move in With My Boyfriend. But It Would Mean Giving Up a Once-in-a-Lifetime Deal.

I Make $100K. My Financial Adviser Has a Specific Piece of Advice I’m Not Sure I Should Take.

My Brother Thinks I “Deserve to Be Poor” for My Life Choices. Now He’s in Charge of Our Inheritance. My parents swear he’ll do the right thing.

I can’t save for a house and my kids’ college tuition. What do I do?

I Inherited a Large Sum of Money at a Young Age. It Made My Whole Family Turn On Me.

My friend is richer than me. And, his attitude about money is starting to grate.

Subscribe now

Be sure to check out all the posts from my Love, Money + Real Estate newsletter. Thanks for reading.

Ilyce

Subscribe now

A lot of the housing news crossing my desk this month made me ask the same uncomfortable question: where, exactly, is the money supposed to come from?

Minimum-wage w…

Read more

Subscribe now

Dear Pay Dirt,

I’m currently in university, …

Read more

Share

Subscribe now

Dear Pay Dirt,

I just learned that my late…

Read more

Subscribe now

Dear Pay Dirt,

I am 45 years old. In my late 20s, I got my life together, went to nursing school, and go…

Read more

Read more

Subscribe now

Last week, the Harvard Joint Center for Housing Studies released its annual State of the Nation…

Read more

Let’s start with the number itself, because most people — even smart people — don’t actually have an intuitive feel for what “a trillion” means. It’s not “a really big million.” It’s not even “a really big billion.” It’s a thousand billions. One million millions.

Here are some other w…

Read more

Read more

Read more

June 3, 2026 · NAREE 60th Annual Real Estate Journalism Conference, Miami

This morning at the NAREE conference in downtown Miami, three of …

Read more

Read more

Read more

Read more