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Warren Buffett’s decision to step down as CEO of Berkshire Hathaway marks the end of an era for the famous investment conglomerate. But his pending retirement is arguably far more significant for the financial world at large. The 94-year-old billionaire investor and philanthropist has been a cultural icon for decades. His plainspoken, relatable advice — the highlight of Berkshire’s annual shareholder meetings and letters — contains lessons and inspiration for all of us who are looking to take control of our financial futures. In fact, his approach to money — characterized by common sense, discipline, and a focus on long-term value — has become a cornerstone of financial literacy. So what? Buffett has served as a reassuring beacon of sound financial advice for most of our lifetimes, using his unique homespun style to educate Americans about not just investing, but saving, borrowing, learning and adapting. As his platform and level of influence change with the shift in Berkshire leadership, let’s not forget the many important principles he has helped instill. Here are just a few of Buffett’s most valuable insights from over the years:On the importance of good money habits:
“You can’t start young enough on working on good money habits… Someone said that the chains of habit are too light to be felt until they’re too heavy to be broken. And habits really make an enormous difference in your life.” (2015)
On the value of long-term investing:
“You do not have to know as much about accounting or stock market terminology or whatever else it may be… None of that counts at all, really, in a lifetime of investing. What counts is having a philosophy that you stick with.” (2018)
“I don’t try and guess the stock market; I just buy businesses I like.” (2017)
“The stock market is there to serve you and not to instruct you. You need to formulate your [own] ideas on price and value… If the price gets cheaper and you have funds, you know, logically, you should buy more.” (2003)
On why time is so important for leveraging compound interest:
“The nature of compound interest is, it behaves like a snowball of sticky snow. And the trick is to have a very long hill — which means either starting very young or living to be very old.” (1999)
On credit card debt:
“If I had one piece of advice to give to young people — you know, across the board — it would be just don’t get in debt...The game plays a lot easier if you’re a little bit ahead of the game than if you’re behind the game.” (2004)
On the link between happiness and money:
“I probably know as many rich people as just about anybody. I don’t think they’re happier because they get super rich. I think they are happier when they don’t have to worry about money.” (2019)
Related Reading
• Warren Buffett: The End of an Era (FXStreet)
• How Warren Buffett Changed the Way Investors Think of Investing (The New York Times via InsuranceNewsNet)
• 5 Money Lessons Warren Buffett Taught His Kids That You Can Teach Yours (The Economic Times)
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