One of the best stock tips I received over ten years ago was to buy Berkshire Hathaway B stock. (BRK/B). I had just read his autobiography, “The Snowball: Warren Buffet and the Business Life,” by Alice Shroeder. I was hooked! Financial education and independence have always been paramount to me, particularly after I got divorced in 1987. I made a decision at that time to take control of my financial destiny and never depend on anyone else. It was a big wake-up call! Warren Buffet is one of the financial gurus whom I can actually understand what he is saying. After losing some money in some investments, I made a decision that if I didn’t understand what the company or investment did, I was going to pass. It didn’t matter to me that there was a promise of big returns. It was a no for me.
Warren Buffet, 92 and Charlie Munger, 99, are still holding their annual meetings in Omaha in May. I attended one around 10 years ago. I was so surprised that Warren drank Cherry coke and ate See’s candy all day long. It is hard to believe that he is still in good health with a poor diet. They are as sharp and curious as any 30-year-old I know. They are probably sharper! their lifetime of experience
Here are some of their quotes from their weekend retreat in Omaha were worth re-broadcasting, maybe a source for some inspiration and knowledge for you?
- “What gives you opportunities is other people doing dumb things.”
- "The situation in banking is what it always was. Fear is contagious. Sometimes the fear is justified, sometimes it isn’t.”
- “In 58 years, I’d say there has been a great increase in the number of people doing dumb things.”
- “Bankers should be more like engineers…avoiding trouble instead of trying to get rich.”
- "One of the inane things that’s taught in modern university education is that a vast diversification is absolutely mandatory in investing in common stocks ... That is an insane idea. It’s not that easy to have a vast plethora of good opportunities that are easily identified. And if you’ve only got three, I’d rather be in my best ideas instead of my worst."
- “The world is overwhelmingly short-term focused. I’d love to be born today and go out with not too much money and hopefully turn it into a lot of money.”
- "I don’t understand the APPLE i-phone at all, but I do understand consumer behavior. ... We’re learning all the time, from all of our businesses. ... We don’t get smarter over time, we ... get a little wiser, though, following it over time."
The best advice of all is the following.
- “You should write your obituary and then try to figure out how to live up to it. That’s something you get wiser on as you go along. ... You just want to make sure you don’t make any mistakes that take you out of the game or come close to taking you out of your game. You should never have a night when you’re worried about investing, assuming you have any money to invest at all. ... Spend a little bit less than you earn, and you can spend a little bit more than you earn. ... Then you’ve got debt, and chances are you’ll never get out of debt. I’ll make an exception in terms of a mortgage on your house.”
Is your financial house in order?? What lessons have you learned based on the money decisions you have made? I have made plenty of mistakes. The older we get, our runway is getting shorter and there is less room for financial losses. My goal is to have financial freedom and start doing the things on my bucket list. What about you?