Manchester United need to focus on bringing younger talent to Old Trafford instead of buying ready-made stars, said the former Reds player.
Younger players are more versatile, and are more likely to stay at the club for longer periods of time, he claimed.
While Man City and Liverpool have the foundations to buy players that are the finished article, United aren’t there yet.
Aaron Wan-Bissaka is the ideal type of player that United should try to buy, as he’s young and a terrific talent, he added.
“Since Sir Alex Ferguson left it’s been a case of quick fixes,” Higginbotham told Sky Sports’ Transfer Talk podcast.
“If you look at the top two teams in the Premier League, Manchester City and Liverpool, they sign players you can build a team around.
“By bringing younger players in, they pick things up a lot easier, so I’m very much for going for the younger players that may not be world stars.
“You don’t necessarily want to sign players that are the finished article, you want to sign players that may be rough round the edges that you can improve to then be a mainstay in United teams for years to come.”
Crystal Palace defender Wan-Bissaka would be a fantastic signing for Ole Gunnar Solskjaer, he added.
He hasn’t looked out of place in the Premier League this season, and could stay at United for a number of years to come.
“In Wan-Bissaka, he’s a player that not many people knew too much about a couple of seasons ago,” he added.
“I’d spoken to Roy Hodgson about him when I was covering Crystal Palace’s games and he had a real baptism of fire in the first few games.
“He’s a former winger, and it became apparent really when Zaha was playing against him in training and he said he’s one of the hardest defenders he’d ever played against.”
It’s believed that United are close to signing the England Under-21 star, after initially having a £50m bid rejected by Palace.
Selhurst Park legend Neil Shipperley has backed the deal, saying it would be very good business for Palace.
Joel Ward is very capable of stepping up to fill Wan-Bissaka’s shoes at right-back, and it’ll be the most money Palace have ever made from one player, he said.