The young forward is reportedly keen to leave Anfield, but John Barnes believes that would be a bad career move.
The young forward has so far rejected a series of contract offers from the club and is expected to tell them that he wishes to leave in the summer, according to the BBC.
The 20-year-old has been linked with a move to a number of clubs as a result of his failed negotiations; with the Guardian claiming that Manchester City are likely to be keen such is their need to sign young, English talent.
However, Barnes says a move to the Etihad would not be in Sterling’s best interests, as he is not guaranteed a regular starting place in their star-studded squad.
"Raheem has not achieved anything, he has not won anything," said Barnes.
"Does anyone believe that if he goes to Manchester City he will be the first name on the team sheet or are they just signing him because they need English players?"
It is not all doom and gloom for the club however, as Sterling’s contract does not expire until 2017, meaning they hold most of the bargaining chips. In fact, it is a similar situation to that of Luis Suarez two years ago.
And while Barnes believes Sterling should stay at the club, he urges them to sell if he is as keen to move on as he appears to be.
"Raheem has great potential, but Liverpool gave him an opportunity and he should stay for a couple of years,” he added.
"The time is not right for him to move, but if he wants to move the club should sell him. The manager cannot keep an unhappy player.”