biography warren buffett

Warren Buffett

Who Is Warren Buffett?

Warren Buffett demonstrated keen business abilities at a young age. He formed Buffett Partnership Ltd. in 1956, and by 1965 he had assumed control of Berkshire Hathaway. Overseeing the growth of a conglomerate with holdings in the media, insurance, energy and food and beverage industries, Buffett became one of the world's richest men and a celebrated philanthropist.

Warren Edward Buffett was born on August 30, 1930, in Omaha, Nebraska. Buffett's father, Howard, worked as a stockbroker and served as a U.S. congressman. His mother, Leila Stahl Buffett, was a homemaker. Buffett was the second of three children and the only boy. He demonstrated a knack for financial and business matters early in his childhood: Friends and acquaintances have said the young boy was a mathematical prodigy who could add large columns of numbers in his head, a talent he occasionally demonstrated in his later years.

Buffett often visited his father's stock brokerage shop as a child and chalked in the stock prices on the blackboard in the office. At 11 years old he made his first investment, buying three shares of Cities Service Preferred at $38 per share. The stock quickly dropped to only $27, but Buffett held on tenaciously until it reached $40. He sold his shares at a small profit but regretted the decision when Cities Service shot up to nearly $200 a share. He later cited this experience as an early lesson in patience in investing.

First Entrepreneurial Venture

By the age of 13, Buffett was running his own businesses as a paperboy and selling his own horseracing tip sheet. That same year, he filed his first tax return, claiming his bike as a $35 tax deduction. In 1942 Buffett's father was elected to the U.S. House of Representatives, and his family moved to Fredricksburg, Virginia, to be closer to the congressman's new post. Buffett attended Woodrow Wilson High School in Washington, D.C., where he continued plotting new ways to make money. During his high school tenure, he and a friend purchased a used pinball machine for $25. They installed it in a barbershop, and within a few months, the profits enabled them to buy other machines. Buffett owned machines in three different locations before he sold the business for $1,200.

Buffett enrolled at the University of Pennsylvania at the age of 16 to study business. He stayed two years, moved to the University of Nebraska to finish up his degree, and emerged from college at age 20 with nearly $10,000 from his childhood businesses.

In 1951 he received his master's degree in economics at Columbia University, where he studied under economist Benjamin Graham and furthered his education at the New York Institute of Finance.

Influenced by Graham's 1949 book, The Intelligent Investor , Buffett sold securities for Buffett-Falk & Company for three years, before working for his mentor for two years as an analyst at Graham-Newman Corp.

Berkshire Hathaway

In 1956 Buffet formed the firm Buffett Partnership Ltd. in his hometown of Omaha. Utilizing the techniques learned from Graham, he was successful in identifying undervalued companies and became a millionaire. One such enterprise Buffett valued was a textile company named Berkshire Hathaway. He began accumulating stock in the early 1960s, and by 1965 he had assumed control of the company.

Despite the success of Buffett Partnership, its founder dissolved the firm in 1969 to focus on the development of Berkshire Hathaway. He phased out its textile manufacturing division, instead expanding the company by buying assets in media ( The Washington Post ), insurance (GEICO) and oil (Exxon). Immensely successful, the "Oracle of Omaha" even managed to spin seemingly poor investments into gold, most notably with his purchase of scandal-plagued Salomon Brothers in 1987.

Following Berkshire Hathaway's significant investment in Coca-Cola, Buffett became director of the company from 1989 until 2006. He has also served as director of Citigroup Global Markets Holdings, Graham Holdings Company and The Gillette Company.

Later Activity and Philanthropy

In 2012 Buffett disclosed that he had been diagnosed with prostate cancer. He began undergoing radiation treatment in July, and successfully completed his treatment in November.

The health scare did little to slow the octogenarian, who annually ranks near the top of the Forbes world billionaires list. In February 2013 Buffett purchased H. J. Heinz with private equity group 3G Capital for $28 billion. Later additions to the Berkshire Hathaway stable included battery maker Duracell and Kraft Foods Group, which merged with Heinz in 2015 to form the third-largest food and beverage company in North America.

In 2016 Buffett launched Drive2Vote, a website aimed at encouraging people in his Nebraska community to exercise their right to vote, as well as to assist in registering and driving voters to a polling location if they needed a ride.

A vocal supporter of Democratic presidential nominee Hillary Clinton , whom he’d endorsed in 2015, Buffett also challenged the Republican nominee, Donald Trump , to meet and share their tax returns. "I will meet him in Omaha or Mar-a-Lago or, he can pick the place, anytime between now and election, he said at an August 1 rally in Omaha. "I'll bring my return, he'll bring his return. We're both under audit. And believe me, nobody's going to stop us from talking about what's on those returns." Trump did not accept the offer, though his refusal to share his returns ultimately did not prevent his election to the presidency in 2016.

In May 2017 Buffett revealed that he had begun selling some of the approximately 81 million shares he owned in IBM stock, noting that he did not value the company as highly as he did six years earlier. Following another sale in the third quarter, his stake in the company dropped to about 37 million shares. On the flip side, he increased his investment in Apple by 3 percent and became Bank of America's largest shareholder by exercising warrants for 700 million shares. Early the following year, he added more Apple shares to make it Berkshire Hathaway's largest common stock investment.

Between 2006 and 2017, Buffett gave away close to $28 billion in charity, according to a report by USA Today .

Healthcare Venture

On January 30, 2018, Berkshire Hathaway, JPMorgan Chase and Amazon delivered a joint press release in which they announced plans to team up and form a new healthcare company for their U.S. employees.

According to the release, the company would be "free from profit-making incentives and constraints" as it tried to find ways to cut costs and improve the overall process for patients, with an initial focus on technology solutions.

Calling the swelling costs of healthcare a "hungry tapeworm on the American economy," Buffett said, "We share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes."

In March outlets reported that Berkshire Hathaway's HomeServices of America Inc., the second-largest residential brokerage owner in the U.S., was set to take more steps toward the top spot, held by Realogy's NRT LLC. Buffett said he "barely noticed" when Berkshire Hathaway originally acquired HomeServices, then part of MidAmerican Energy Holdings Co., back in 2000.

Buffett returned to the news in spring 2020 with the announcement that Berkshire Hathaway had dumped its holdings in the "big four" airlines — Southwest, American, Delta and United — over concerns that the industry would never fully recover from the coronavirus pandemic.

Personal Life

In 2006 Buffett, at age 76, married his longtime companion Astrid Menks.

Buffett was previously married to his first wife Susan Thompson from 1952 until her death in 2004, although the couple separated in the 1970s. He and Susan had three children: Susan, Howard and Peter.

QUICK FACTS

• Birth Year: 1930
• Birth date: August 30, 1930
• Birth State: Nebraska
• Birth City: Omaha
• Birth Country: United States
• Gender: Male
• Best Known For: Known as the "Oracle of Omaha," Warren Buffett is an investment guru and one of the richest and most respected businessmen in the world.
• Business and Industry
• Astrological Sign: Virgo
• University of Pennsylvania
• Woodrow Wilson High School
• University of Nebraska
• Columbia University

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CITATION INFORMATION

• Article Title: Warren Buffett Biography
• Author: Biography.com Editors
• Website Name: The Biography.com website
• Url: https://www.biography.com/business-leaders/warren-buffett
• Access Date:
• Publisher: A&E; Television Networks
• Last Updated: May 27, 2021
• Original Published Date: April 3, 2014
• You can't make a baby in a month if you get nine women pregnant.
• My kids are going to carve out their own place in this world, and they know I'm for them whatever they want to do.
• It's a lot easier to buy things sometimes than it is to sell them.
• Rule number one: Never lose money. Rule number two: Never forget rule number one.
• I made my first investment at age 11. I was wasting my life up until then.
• It is impossible to unsign a contract, so do all your thinking before you sign.
• It's easier to stay out of trouble than it is to get out of trouble.
• You should invest like a Catholic marries—for life.
• Wall Street is the only place that people ride to in a Rolls-Royce to get advice from those who take the subway.
• If calculus or algebra were required to be a great investor, I'd have to go back to delivering newspapers.
• Price is what you pay. Value is what you get.
• The dumbest reason in the world to buy a stock is because it's going up.
• Never ask a barber if you need a haircut.
• Risk comes from not knowing what you're doing.
• You couldn't advance in a finance department in this country unless you taught that the world was flat.
• After all, you only find out who is swimming naked when the tide goes out.
• You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.
• Someone's sitting in the shade today because someone planted a tree a long time ago.
• I feel great... and my energy level is 100 percent.

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Warren Buffett

What is Warren Buffett known for?

What is warren buffett's primary investment vehicle, what charities does warren buffett donate money to, when was warren buffett awarded the presidential medal of freedom.

Warren Buffett (born August 30, 1930, Omaha, Nebraska, U.S.) is an American businessman and philanthropist, widely considered the most successful investor of the 20th and early 21st centuries, having defied prevailing investment trends to amass a personal fortune of more than $100 billion.

Known as the “Oracle of Omaha,” Buffett was the son of U.S. Rep. Howard Homan Buffett from Nebraska . After graduating from the University of Nebraska (B.S., 1950), he studied with Benjamin Graham at the Columbia University School of Business (M.S., 1951). In 1956 Buffett returned to Omaha and in 1965 took majority control of the textile manufacturer Berkshire Hathaway Inc. , turning it into his primary investment vehicle. From the 1960s through the ’90s the major stock averages rose by roughly 11 percent annually, but Berkshire Hathaway’s publicly traded shares gained about 28 percent per year. Though Buffett’s success with Berkshire Hathaway made him one of the world’s wealthiest men, he eschewed lavish spending and criticized governmental policies and taxation that favoured the rich over the middle or lower classes.

In June 2006 Buffett announced that he planned to donate more than 80 percent of his wealth to charitable foundations ; in 2020 he raised that amount to 99 percent. The main recipient was the Bill & Melinda Gates Foundation —created by Microsoft founder Bill Gates and his then wife, Melinda —which focused on issues of world health and education ; Bill and Buffett had maintained a close friendship since the early 1990s. The other organizations receiving donations included those run by Buffett’s three children and the Susan Thompson Buffett Foundation, named for his late wife, which focused on women’s reproductive rights and funded college scholarship programs. In 2010 Buffett and the Gateses created the Giving Pledge, an invitation to other wealthy individuals to donate the majority of their fortune to charities.

During the subprime mortgage crisis of 2007–08, Buffett made a number of deals that, though questioned at the time, proved highly profitable. In September 2008 he invested $5 billion in the U.S.-based bank holding company Goldman Sachs Group, Inc. , and the following month Berkshire Hathaway purchased $3 billion in General Electric Company (GE) preferred stock. In November 2009 Buffett announced that Berkshire was buying the railroad company Burlington Northern Santa Fe Corporation for about $26 billion; the investment group already owned approximately 23 percent of the railroad. Berkshire Hathaway also had significant shareholdings in companies it did not control, including Coca Cola and Apple .

In 2011 Buffett was awarded the Presidential Medal of Freedom .

Warren Buffett

Real time net worth.

• Known as the "Oracle of Omaha," Warren Buffett is one of the most successful investors of all time.
• Buffett runs Berkshire Hathaway, which owns dozens of companies, including insurer Geico, battery maker Duracell and restaurant chain Dairy Queen.
• The son of a U.S. congressman, he first bought stock at age 11 and first filed taxes at age 13.
• He has promised to donate over 99% of his wealth. So far he has given some $60 billion, mostly through the Gates Foundation and his kids' foundations.
• In 2010, he and Bill Gates launched the Giving Pledge, asking other billionaires to commit to donating at least half of their fortune to charitable causes.

Forbes Lists

Rational people don't risk what they have and need for what they don't have and don't need. Warren Buffett

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Warren Buffett Biography

Birthday: August 30 , 1930 ( Virgo )

Born In: Omaha, Nebraska, United States

One of the world’s wealthiest people and perhaps the most influential philanthropists of all times, Warren Buffett does not really need an introduction. He is the chairman, CEO and the largest shareholder of Berkshire Hathaway, a multinational conglomerate holding company headquartered in Omaha. He is much respected by his peers and the world alike for his personal frugality and adherence to ethical principles when it comes to successful business management. Called the ‘Oracle of Omaha’, Buffett rose from a modest beginning to become one of the richest men on earth through his sheer hard work and keen sense of investing. He started demonstrating his financial abilities from his early years when he would go from door to door selling candies and soft drinks. He began investing as a teenager and had saved almost $10,000 dollars by the age of 20. He has great business acumen and he started out on his career as a stock broker. He developed his own investment principles which helped him acquire a lot of wealth; he was already a millionaire by the time he was in his early thirties. As his wealth grew, so did his desire to give back to the society—he is a notable philanthropist and has pledged to give away a significant portion of his fortunes to charity.

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Also Known As: Warren Edward Buffett

Age: 93 Years , 93 Year Old Males

Spouse/Ex-: Astrid Menks (m. 2006), Susan Buffett (m. 1952–2004)

father: Howard Buffett

mother: Leila Stahl Buffett

children: Howard Graham Buffett , Peter Buffett, Susan Alice Buffett

Born Country: United States

Billionaires Philanthropists

Height: 5'10" (178 cm ), 5'10" Males

U.S. State: Nebraska

City: Omaha, Nebraska

education: Columbia Business School (1950–1951), University of Nebraska–Lincoln (1950–1950), Wharton School of the University of Pennsylvania (1947–1949), Woodrow Wilson High School, University of Pennsylvania

You wanted to know

What is warren buffett's investment strategy, how did warren buffett become successful in investing, what companies has warren buffett invested in, what is warren buffett's approach to risk management, how does warren buffett evaluate a company before investing.

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Warren Buffett was one of the three children of Howard and Leila Buffett. He had two sisters. His father was a four-term U.S. congressman.

Warren Buffett enrolled at the Wharton School of the University of Pennsylvania in 1947, where he studied for two years. He shifted to University of Nebraska–Lincoln from where he graduated with a Bachelor of Science in business administration.

Warren attended Columbia Business School and earned a Master of Science in economics in 1951. There he had the privilege of attending classes taught by Benjamin Graham and David Dodd.

Warren Buffett  worked at his father’s company, Buffett-Falk & Co. from 1951 to 1954, as an investment salesman. By the age of 20, he had already amassed savings worth almost $10,000 in 1950 — this showed what an astute investor he was.

He started operating several other partnerships and by the end of the decade he had seven partnerships operating. He became a millionaire in 1962, as a result of his earnings from all his partnerships.

During the late 1960s, he shifted the business from textile into the insurance sector and by 1985, the last of the textile mills under Berkshire Hathaway had been sold off.

Berkshire Hathaway purchased a 12% stake in Salomon Inc. in 1987, and became its largest shareholder; Buffett became its director. Following a scandal in 1990, John Gutfreund the CEO of Salomon Brothers left the company in 1991. Buffett took over as chairman till the crisis passed.

Buffett began buying stocks in Coca-Cola Company in 1988, eventually purchasing up to 7% of the company for $1.02 billion. It would prove to be one of Berkshire’s best ever investments.

In June 2006, Warren Buffett made an announcement that he would be gradually giving away 85% of his Berkshire holdings to five foundations, the largest contribution of which would go to the Bill and Melinda Gates Foundation.

He became the richest person in the world in 2008, with a total net worth estimated at $62 billion by Forbes, overtaking Bill Gates who had been the No.1 on Forbes list for the past 13 years. The very next year, Gates regained the first position and Buffett moved to second place.

Warren Buffett was presented with the Presidential Medal of Freedom by President Barack Obama in 2011.

Warren Buffett married Susan Thompson in 1952. The couple had three children. Susan left him in 1977, to pursue her own career and started living separately. They never divorced and remained legally married till Susan’s death in 2004.

He was diagnosed with prostate cancer in April 2012, and has successfully completed his treatment.

According to Forbes, in 2022, Warren Buffett's net worth is $129.7 billion.

Warren Buffett still lives in the same modest house in Omaha, Nebraska. Despite his immense wealth, he chooses to live a simple and frugal lifestyle.

Buffett is known for his love of junk food, particularly Cherry Coke and hamburgers. He is often seen dining at fast food restaurants like McDonald's and Dairy Queen.

Buffett plays the ukulele and is a self-taught musician. He has even performed at various events and charity functions.

In his younger days, Buffett delivered newspapers, sold chewing gum, and even set up pinball machines in barber shops to make money.

Buffett is an avid bridge player and has even competed in bridge tournaments.

See the events in life of Warren Buffett in Chronological Order

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Warren Buffett: A Brief History

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Warren Buffett’s Investment Strategy

The investment principles of the legendary investor

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Warren Buffett is known as both a savvy businessman and generous philanthropist. He's one of the world’s richest people, consistently ranking high on the Forbes list of billionaires. His net worth was listed at a bit more than $130.7 billion as of July 2024.

He's probably best known for being one of the world’s most successful investors. Warren Buffett’s investment strategy has reached mythical proportions. He subscribes to several important tenets and an investment philosophy that's widely followed around the globe. So, what are the secrets to his success?

Key Takeaways

• Warren Buffett is one of the wealthiest people in the world, amassing his fortune through a successful investment strategy.
• Buffett follows the Benjamin Graham school of value investing which looks for securities with prices that are unjustifiably low based on their intrinsic worth.
• Buffett looks at companies as a whole rather than focusing on the supply-and-demand intricacies of the stock market.
• Some factors Buffett considers include company performance, company debt, and profit margins.
• Other considerations for value investors like Buffett include whether companies are public, how reliant they are on commodities, and how cheap they are.

Warren Buffett was born in Omaha in 1930. He developed an interest in the business world and in investing at an early age, including the stock market . Buffett started his education at the Wharton School at the University of Pennsylvania before moving to the University of Nebraska where he received an undergraduate degree in business administration. He later went to the Columbia Business School where he earned his graduate degree in economics.

Buffett began his career as an investment salesperson in the early 1950s and he formed Buffett Associates in 1956. He was in control of Berkshire Hathaway less than 10 years later in 1965. Buffett announced his plans to donate his entire fortune to charity in June 2006. He and Bill Gates then announced in 2010 that they had formed the Giving Pledge campaign to encourage other wealthy individuals to pursue philanthropy.  

Alison Czinkota / Investopedia

Buffett’s Investment Philosophy

Buffett follows the Benjamin Graham school of value investing . Value investors look for securities with prices that are unjustifiably low based on their intrinsic worth. There isn’t a universally-accepted method to determine intrinsic worth but it’s most often estimated by analyzing a company’s fundamentals. A value investor searches for stocks that are believed to be undervalued by the market or that aren't recognized by the majority of other buyers.

Buffett takes this value investing approach to another level. Many value investors don't support the efficient market hypothesis (EMH) , a theory that suggests that stocks always trade at their fair value. This makes it harder for investors to buy stocks that are undervalued or to sell them at inflated prices. They do trust that the market will eventually start to favor those quality stocks that were undervalued for a time.

Warren Buffett has continuously stressed the importance of investing in yourself as a means to success. This includes making prudent financial choices as well as increasing your knowledge in the areas in which you seek to take part.

Buffett isn’t concerned with the supply-and-demand intricacies of the stock market. He’s not really concerned with the activities of the stock market at all. This is the implication in his famous paraphrase of a Benjamin Graham quote: “In the short run, the market is a voting machine, but in the long run, it is a weighing machine.”

He looks at each company as a whole so he chooses stocks based solely on their overall potential as a company. Buffett doesn’t seek capital gain by holding these stocks as a long-term play. He wants ownership in quality companies that are extremely capable of generating earnings.

Buffett isn’t concerned when he invests in it whether the market will eventually recognize a company's worth. He's concerned with how well that company can make money as a business.

Buffett's Investment Tips

Buffett has shared his philosophies through some outstanding and thought-provoking tips over the years.

1. Wait...Then Pounce

Buffett advises taking a deep breath and a step back when you find a company in which you want to invest. He suggests giving the stock time to achieve a reasonable valuation, then moving when the market corrects.

2. Stay the Course

So you've breathed, you've waited, and now it's time to move. Buffett suggests that you want to resist panicking at this point and selling your holdings when they falter...and at some point, they will. Don't sell. Buy.

"Just keep buying," he said in a CNBC interview. "American business is going to do fine over time, so you know the investment universe is going to do very well."

3. Pick Businesses, Not Stocks

Always, always weigh and analyze the business behind a stock. Try to focus on businesses you understand and of which you have some knowledge. This will help you assess where a company is going, not just where it's been and where it is at present.

Buffett once famously took passes on Google and Amazon because he admitted that he didn't possess firm knowledge of the Internet industry so he found it difficult to analyze its stocks.

This tip goes hand-in-hand with having patience. Educate yourself if you spot an interesting opportunity in a field that you're not entirely familiar with. Analyze the balance sheets. Take time to learn.

Another priceless Buffett advisory comment is that you should plan to own a stock for at least 10 years, if not longer, keep in mind that a business will have time to evolve. "If you aren't willing to own a stock for 10 years, don't even think about owning it for 10 minutes," he said in his 1996 letter to Berkshire Hathaway shareholders.

Buffett’s Methodology

Warren Buffett finds low-priced value by asking himself some questions when he evaluates the relationship between a stock’s level of excellence and its price. But keep in mind that these aren't the only things he analyzes. They make a brief summary of what he looks for in his six-step investment approach.

1. Company Performance

Return on equity (ROE) is sometimes referred to as the stockholder’s return on investment . It reveals the rate at which shareholders earn income on their shares. Buffett always looks at ROE to see whether a company has consistently performed well when compared to other companies in the same industry.

ROE is calculated as follows:

ROE = (Net Income ÷ Shareholder’s Equity) X 100

Looking at the ROE in just the last year isn’t enough. An investor should view it from the past five to 10 years to analyze historical performance.

2. Company Debt 

The debt-to-equity (D/E) ratio is another characteristic Buffett considers carefully. He prefers to see a small amount of debt with earnings growth being generated from shareholders’ equity rather than borrowed money.

The D/E ratio is calculated as follows:

Debt-to-Equity Ratio = Total Liabilities ÷ Shareholders' Equity

This ratio shows the proportion of equity and debt the company uses to finance its assets. The higher the ratio, the more debt is financing the company rather than equity. A high debt level compared to equity can result in volatile earnings and large interest expenses . Investors sometimes use only long-term debt instead of total liabilities in the above calculation for a more stringent test.

3. Profit Margins

A company’s profitability depends not only on having a good profit margin but also on consistently increasing it. This margin is calculated by dividing net income by net sales. Investors should look back at least five years for a good indication of historical profit margins.

A high profit margin indicates that the company is executing its business well. Steadily increasing margins means that management has been extremely efficient and successful at controlling expenses.

4. Is the Company Public?

Buffett typically considers only companies that have been around for at least 10 years. Most of the technology companies that have had their initial public offerings (IPOs) in the last decade wouldn’t appear on his radar as a result. He’s said that he doesn’t understand the mechanics behind many technology companies and only invests in businesses that he fully comprehends.

Value investing requires identifying companies that have stood the test of time but are currently undervalued.

Value investing focuses on a company’s financials, whereas technical investing looks at a stock’s price and volume and how the price has moved historically.

Never underestimate the value of historical performance. This demonstrates the company’s ability or inability to increase shareholder value . But keep in mind that a stock’s past performance doesn't guarantee future performance.

The value investor’s job is to determine how well the company can perform in the future. Determining this is inherently tricky but Buffett is clearly very good at it.

One important point to remember about public companies is that the Securities and Exchange Commission (SEC) requires that they file regular financial statements. These documents can help investors analyze important company data, including current and past performance, so they can make important investment decisions.

5. Commodity Reliance

You might initially think that this question is a radical approach to narrowing down a company but Buffett sees it as an important one. He tends to shy away from companies whose products are indistinguishable from those of their competitors, as well as those that rely solely on a commodity such as oil or gas... but not always.

Buffett sees little that sets that company apart if it doesn't offer anything different from another firm within the same industry. Any characteristic that's hard to replicate is what Buffett calls a company’s “ protective moat ,” giving it a competitive advantage. The wider the moat, the tougher it is for a competitor to gain market share .

6. Is It Cheap?

This is the kicker. Finding companies that meet the other five criteria is one thing but determining whether they're undervalued is the most difficult part of value investing. That makes it Buffett’s most important skill.

An investor must determine a company’s intrinsic value by analyzing several business fundamentals, including earnings, revenues, and assets. A company’s intrinsic value is usually higher and more complicated than its liquidation value, which is what a company would be worth if it were broken up and sold today.

The liquidation value doesn’t include intangibles that aren't directly stated on the financial statements, such as the value of a brand name. When Buffett determines the intrinsic value of the company as a whole, he then compares it to its current market capitalization : its current total worth or price.

Sounds easy, doesn’t it? Buffett’s success depends on his unmatched skill in accurately determining this intrinsic value. We can outline some of his criteria but we have no way of knowing exactly how he gained such precise mastery at calculating value.

Buffett’s Top Holdings

It's possible to see which stocks Buffett has signed off on as good investments based on regulatory filings from his public holding company, Berkshire Hathaway ( BRK.A ). As of July 2024, these included:

• Apple, Inc. ( AAPL )
• Bank of America ( BAC )
• American Express ( AXP )
• Chevron ( CVX )
• Coca-Cola ( KO )
• Kraft Heinz ( KHC )
• Occidental Petroleum ( OXY )

Buffett also has several large stakes in privately held companies, such as Burlington Northern Santa Fe (BNSF) Railroad and GEICO Insurance.

What Companies Does Warren Buffett Own?

Warren Buffett has a stake in many companies through his holding company, Berkshire Hathaway. Some of his largest holdings include Bank of America, Apple, American Express, and Coca-Cola.

How Did Warren Buffett Become Rich?

Warren Buffett became rich steadily over a long period of time, primarily through investing which he began doing at the age of 11. He started his own business venture as a paperboy at 13 and he also sold horse racing tip sheets. He formed his own company as an adult and began investing in companies he believed were undervalued, earning profits. He reinvested those profits in more investments and his wealth continued to grow.

He eventually bought Berkshire Hathaway, where he continued with his value investing strategy.

Is Warren Buffett Self-Made?

Warren Buffett is self-made although he did come from a fairly privileged background. His father owned a stock brokerage firm and eventually became a U.S. Congressman. This allowed Buffett to attend prestigious schools, such as Columbia University. But he did start his own company and make his own investments, which eventually led to his enormous wealth.

What Is the Best Investment According to Warren Buffett?

According to Warren Buffet, “The best investment—by far—is developing yourself.” In particular, he says, “I would say communications skills are the first area I would work on to enhance your value throughout life...if you can’t talk to people, you’ve got a real problem selling securities.”

You must ultimately develop skills that other people are willing to pay for. You’re set for success when you do, Buffett says, or, as he puts it in financially-tinged language, “Your abilities can’t be inflated away from you.”

Buffett’s investing style is like the shopping style of a bargain hunter. It reflects a practical, down-to-earth attitude. Buffett maintains this attitude in other areas of his life. He doesn’t live in a huge house, he doesn’t collect cars, and he doesn’t take a limousine to work. The value-investing style is not without its critics but the proof is in the pudding regardless of whether you admire Buffett or you don't.

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Warren Buffett: Biography, Success Story, Berkshire Hathaway

Warren Buffett

The biography of Warren Buffett unveils a riveting saga of a trajectory par excellence in the financial sphere. A luminary in investment and philanthropy, Buffett’s success story encapsulates strategic acumen, smart investment principles, and an unfailing commitment to ethical business. His journey, rich with strategic business moves and unparalleled financial wisdom, is not merely a biography but a manual delineating the architecture of building a financial empire with prudence and integrity.

Table of Contents

Biography Summary

Warren Edward Buffett, born on August 30, 1930, has cemented his legacy as an American business magnate, investor, and generous philanthropist. Currently holding the reins as the chairman and CEO of Berkshire Hathaway, his investment prowess has not only catapulted him into financial success but also established him as a globally renowned fundamental investor. As per the latest data available in October 2023, Buffett’s financial acumen has amassed him a net worth of $117 billion, positioning him as the seventh-richest individual globally.

Hailing from Omaha, Nebraska, Buffett was not a stranger to the business world, being the progeny of Congressman and businessman Howard Buffett. His youthful curiosity in business and investing led him to the Wharton School of the University of Pennsylvania in 1947. However, he completed his academic journey at the University of Nebraska, graduating at 19. Further sharpening his financial intellect, he graduated from Columbia Business School, adhering to the principles of value investing, a concept heralded by Benjamin Graham. The New York Institute of Finance further solidified his economics foundation, paving the way for his business ventures to unfurl.

Buffett didn’t just stop at theoretical knowledge. His business journey began with various ventures and investment partnerships, including one with Graham. In 1956, he founded Buffett Partnership Ltd. The trajectory of his business pursuits took a significant turn when his investment firm acquired a textile manufacturing firm, Berkshire Hathaway. This acquisition was not just in assets but also in name, as his diversified holding company assumed its mantle. Eventually, in 1970, he surfaced as the company’s chairman and majority shareholder. In 1978, another notable name, Charlie Munger, partnered with Buffett, serving as vice-chairman, thus solidifying the formidable leadership at Berkshire Hathaway.

An Oracle of Investment Wisdom

Buffett’s tenure as the chairman and predominant shareholder of Berkshire Hathaway since 1970 has marked an era where the company has emerged as one of America’s principal holding companies and a global corporate conglomerate. The national and international media has often called him the “Oracle” or “Sage” of Omaha. This epithet shows the immense wealth he accumulated through shrewd business and investment strategies. Despite the enormous wealth at his disposal, Buffett is celebrated for his adherence to the principles of value investing and, notably, his frugality.

Philanthropy: A Pillar of Buffett’s Legacy

Buffett’s impact isn’t limited to the business world; he is also a heralded philanthropist, having vowed to allocate 99 percent of his wealth to philanthropic endeavors, primarily through the Bill & Melinda Gates Foundation. Co-founding The Giving Pledge in 2010 alongside Bill Gates , Buffett has been pivotal in encouraging billionaires to donate at least half of their fortunes to philanthropic causes, ensuring that wealth can be a tool for global betterment.

Warren Edward Buffett, born in Omaha, Nebraska, on August 30, 1930, enjoyed a childhood that was remarkably ordinary yet tinged with subtle indications of his future financial prowess. He was the second of three children and the sole son of Leila (Stahl) and Congressman Howard Buffett. His educational journey began at Rose Hill Elementary School and later shifted to Washington, D.C., owing to his father’s electoral success in the United States Congress. Here, Buffett transitioned through Alice Deal Junior High School and graduated from Woodrow Wilson High School in 1947, with his senior yearbook subtly predicting a future in finance: “likes math; a future stockbroker.”

Despite an inclination to bypass college to dive straight into the business world following his high school graduation and fruitful side ventures, Buffett acceded to his father’s wishes, embarking on a collegiate journey that would fortify his business acumen.

An Entrepreneurial Spirit Kindled in Childhood

Buffett’s enterprise was evident from a tender age. A book borrowed from the Omaha public library at the mere age of seven, One Thousand Ways to Make $1000 , fueled his early interest in business. His childhood was punctuated with various small-scale ventures, from selling chewing gum and weekly magazines door-to-door to working in his grandfather’s grocery store. Still, in high school, he derived income through newspaper delivery, selling golf balls and stamps, and car detailing, among other endeavors. In a notable venture in 1945, a 15-year-old Buffett and his friend invested $25 in a used pinball machine, strategically placing it in a local barber shop, eventually parlaying it into a business that spanned three shops and later sold for $1,200.

Visiting the New York Stock Exchange

The young Buffett’s fascination with the stock market and investing was evident from the school days he spent in the customer lounge of a regional stock brokerage near his father’s office. His father was pivotal in nurturing young Warren’s interest, even facilitating a visit to the New York Stock Exchange at the age of 10. At age 11, he made his initial foray into the stock market, purchasing three shares of Cities Service Preferred for himself and three for his sister, Doris Buffett. His industrious nature continued to shine; by 15, he was earning over $175 monthly from delivering Washington Post newspapers and, at just 14, invested $1,200 of his savings in a 40-acre farm. By the conclusion of his college years, Buffett had accumulated $9,800 in savings.

In 1947, Buffett enrolled at the Wharton School of the University of Pennsylvania, although he was inclined to focus on his burgeoning business ventures. After two years and a subsequent transfer to the University of Nebraska, he graduated with a Bachelor of Science in business administration at 19. A rejection from Harvard Business School led him to Columbia Business School of Columbia University, drawn by the presence of Benjamin Graham, a significant influence on his investment philosophy. He secured a Master of Science in economics from Columbia in 1951 and later attended the New York Institute of Finance.

Buffett, reflecting on the foundational principles laid down by Ben Graham, articulated that viewing stocks as a business, capitalizing on market fluctuations, and ensuring a margin of safety remain quintessential. In Buffett’s words, these principles have steadfastly endured, and “A hundred years from now, they will still be the cornerstones of investing.” Someone’s sitting in the shade today because someone planted a tree a long time ago. – Warren Buffett Share on X

Early Career

Warren Buffett manifested a distinct adeptness for investments and an unparalleled strategic mind throughout his early business career. His journey from 1951 to 1954 at Buffett-Falk & Co. as an investment salesman, onto a securities analyst at Graham-Newman Corp. from 1954 to 1956, and subsequently a general partner at Buffett Partnership, Ltd. from 1956 to 1969, showcased an individual who was steadily molding a future that would intertwine with Berkshire Hathaway Inc., where he assumed the position of chairman and CEO starting in 1970.

Early Ventures

In 1951, Buffett’s path intersected with GEICO insurance through a discovery that his mentor, Benjamin Graham, sat on the board. A spontaneous train trip to Washington, D.C., led to an unexpected, yet meaningful, meeting with Lorimer Davidson, GEICO’s vice president, after a persistent Buffett was allowed entrance by a janitor. The ensuing discussion on the insurance business fostered a lifelong friendship and influential relationship between Buffett and Davidson, with the latter swiftly recognizing Buffett’s exceptional understanding after a mere quarter of an hour.

Although tempted by the allure of Wall Street, counsel from his father and Graham dissuaded Buffett. His respect for Graham was apparent when he offered to work without compensation, an offer Graham declined. Back in Omaha, Buffett worked as a stockbroker and honed his public speaking skills through a Dale Carnegie course, leading him to confidently lecture on “Investment Principles” at the University of Nebraska-Omaha. Concurrently, a side investment in a Sinclair gas station did not prove fruitful.

Steady Expansion

1952 witnessed Buffett uniting in marriage with Susan Thompson, followed by the birth of their first child, Susan Alice, the subsequent year. A career milestone was met in 1954 when he joined Benjamin Graham’s partnership with an annual starting salary of $12,000. Buffett worked in close quarters with Walter Schloss and imbibed Graham’s philosophy of ensuring a wide margin of safety in stock picks. That same year welcomed the arrival of the Buffetts’ second child, Howard Graham. Upon Graham’s retirement in 1956, Buffett, with personal savings exceeding $174,000, inaugurated Buffett Partnership Ltd.

By 1957, Buffett managed three investment partnerships and settled into a five-bedroom house in Omaha, purchased for $31,500, which remains his residence. 1958 saw the birth of his third child, Peter Andrew, and Buffett overseeing five partnerships. 1959 ushered in the expansion of six partnerships and introduced Buffett to his future partner, Charlie Munger. 1960 saw seven partnerships under Buffett, who then enlisted eleven doctors to invest $10,000 each while he himself injected a mere $100.

Strategic Investments

In 1961, Buffett astutely directed 35% of the partnership’s assets into the Sanborn Map Company. His strategic analysis discerned that while Sanborn stock was priced at $45 per share in 1958, the company’s investment portfolio was valued at $65 per share, paradoxically valuing the map business at “minus $20” per share. As an activist investor, Buffett procured 23% of the company’s outstanding shares, secured a board seat, and, in alliance with other unsatisfied shareholders, controlled 44% of the shares. A potential proxy fight was averted when the board used a segment of its investment portfolio to repurchase shares at fair value. Buffett yielded a striking 50% return on investment within two years through this strategic maneuver, accentuating an auspicious beginning to a prolific investment career.

Berkshire Hathaway

The 1962 period marked a pivotal moment for Warren Buffett, catapulting him into millionaire status due to the prosperous health of his partnerships, accumulating an excess of $7,178,500, with over $1,025,000 attributed to him directly. He cleverly amalgamated these partnerships, setting his sights on Berkshire Hathaway, a textile manufacturing firm, initiating a trajectory that would firmly intertwine his destiny with the enterprise.

Buffett strategically started accumulating shares in Berkshire from owner Seabury Stanton, only to relieve him of his position later. Although initially purchasing shares at $7.60 each, by 1965, the investment escalated to $14.86 per share against the company’s working capital of $19 per share, excluding fixed assets. The meticulous acquisition culminated in Buffett assuming control during a board meeting, subsequently appointing Ken Chace as president to manage the company. 1966 observed Buffett capping the partnership to fresh investments, later describing the textile business avenue as his most underwhelming trade. Risk comes from not knowing what you are doing. – Warren Buffett Share on X

Expanding Horizons

Through a strategic pivot, the business delved into the insurance sector, and by 1985, the last textile mills that initially comprised Berkshire Hathaway’s core business were divested. Buffett expanded his investment horizon by venturing into his first private business investment with Hochschild, Kohn, and Co., a Baltimore department store. Berkshire released its inaugural and singular dividend of 10 cents in 1967. In 1969, with the liquidation of the partnership, assets were dispersed to his partners, including Berkshire Hathaway shares.

The Pen, the Paper, and Unfolding Events

Warren Buffett, drawing from a modest salary of $50,000 and his external investment income, commenced his renowned tradition of penning annual letters to shareholders in 1970. Berkshire’s trajectory took a significant turn when it initiated a stock acquisition in the Washington Post Company in 1973. A close friendship blossomed between Buffett and Katharine Graham, the company’s controller, and he subsequently joined the board.

Despite facing an SEC investigation in 1974 related to Berkshire’s acquisition of Wesco Financial and encountering antitrust charges post the indirect purchase of the Buffalo Evening News for $32.5 million in 1977, Buffett and Berkshire Hathaway navigated through without serious repercussions.

Steering Through Crises

1979 saw Berkshire initiating stock purchases in ABC, followed by a surprising media industry moment in 1985 when Capital Cities announced a $3.5 billion ABC acquisition, backed by financing from Buffett in exchange for a 25% stake in the merged entity, Capital Cities/ABC.

Under Buffett’s watch, Berkshire Hathaway acquired a 12% stake in Salomon Inc. in 1987 but encountered a crisis in 1990 due to a scandal involving former Salomon Brothers CEO John Gutfreund and rogue trader Paul Mozer. Buffett assumed chairmanship until stability was reestablished. In 1988, Buffett pivoted towards The Coca-Cola Company, investing up to 7% (or $1.02 billion), which emerged as one of Berkshire’s most profitable investments and remained in its portfolio.

Navigating through strategic investments, unexpected challenges, and intelligent business transformations, Buffett’s early journey with Berkshire Hathaway underscores a tale of adept leadership, prudent investment strategies, and insightful business pivots.

Billionaire Buffet

The journey of Warren Buffett navigating through the realms of the billionaire club started on May 29, 1990, when Berkshire Hathaway launched its Class A shares. The market concluded at a solid $7,175 a share, pushing Buffett into the elite billion-dollar bracket.

The General Re-Acquisition

1998 marked the acquisition of General Re (Gen Re), a subsidiary, and proved challenging for Buffett and his team. According to insights from the Rational Walk investment website, they grappled with “inadequate” underwriting standards. They navigated through a “problematic derivatives book,” which was finally settled after several years and considerable financial loss. However, Gen Re came into the limelight again when it provided reinsurance after Buffett engaged with Maurice R. Greenberg at AIG in 2002.

Legal Challenges

An intricate web of legal and ethical challenges unfolded in 2005 when Gen Re executives became embroiled in an accounting fraud case concerning AIG. In a tumultuous period, AIG’s board coerced Greenberg to resign as chairman and CEO due to allegations of engaging in questionable transactions and improper accounting by New York state regulators. A consequential fine of $1.6 billion was agreed upon by AIG in 2006. 2010 saw the U.S. government agree to a $92 million settlement with Gen Re, preventing prosecution in the AIG case. Furthermore, Gen Re agreed to enforce “corporate governance concessions,” involving Berkshire Hathaway’s CFO in General Re’s audit committee meetings and mandating the appointment of an independent director.

Forex Venture and Philanthropy

Venturing into a different realm, Buffett entered $11 billion worth of forward contracts to deliver U.S. dollars against other currencies in 2002. By April 2006, he boasted a total gain exceeding $2 billion on these contracts. A significant shift towards philanthropy was revealed in June 2006 when Buffett declared his intent to gradually donate 85% of his Berkshire holdings to five foundations through annual stock gifts, with the most significant slice going to the Bill and Melinda Gates Foundation.

Succession Planning

In a 2007 letter to shareholders, Buffett addressed the inevitable aspect of succession. He announced his quest to identify a younger successor (or potentially multiple individuals) to steer his investment business forward, ensuring the perpetuity and stability of Berkshire Hathaway for future generations.

Through challenging legal landscapes, insightful currency investment strategies, and substantial philanthropic gestures, Warren Buffett, as a billionaire, illustrated a remarkable blend of acumen, resilience, and generosity, crafting a legacy far beyond mere wealth accumulation.

The 2007–08 Crisis

The tumultuous period of the 2007–08 financial crisis, a fragment of the broader Great Recession, saw Warren Buffett, the Oracle of Omaha, plunged into a vortex of criticism and economic challenges. Notably, critiques centered around his capital allocation too precipitously, arguably leading to less-than-ideal deals.

In 2008, in an op-ed penned for  The New York Times , “ Buy American. I am ,” Buffett extended an optimistic stance amidst the economic turmoil. Despite labeling the financial sector’s downturn starting in 2007 as “poetic justice,” Buffett’s conglomerate, Berkshire Hathaway, experienced a staggering 77% plummet in earnings during Q3 2008. Moreover, several subsequent deals were tarnished with substantial mark-to-market losses.

Berkshire Hathaway secured 10% of Goldman Sachs’ perpetual preferred stock in an assertive move. Yet, toward the end of 2008, Buffett’s written (sold) put options encountered approximately $6.73 billion in mark-to-market losses. This potential fiscal black hole prompted the SEC to demand from Berkshire a “more robust disclosure” regarding the valuation factors for the contracts. Furthermore, Buffett assisted Dow Chemical in its $18.8 billion acquisition of Rohm & Haas, thereby becoming the largest shareholder in the expanded group, and further illustrated his pivotal role during the crisis. Never invest in a business you cannot understand. – Warren Buffett Share on X

In 2008, despite the financial tremors, Buffett emerged as the wealthiest individual globally, with Forbes estimating his net worth at $62 billion and Yahoo at $58 billion, dethroning Bill Gates. However, the financial landscape quickly shifted. By 2009, a significant wealth erosion occurred, with Buffett losing $25 billion over 12 months, according to  Forbes , and Gates reclaimed the apex position on the wealth list.

Tactical Decisions and Challenges

In a tactical venture, October 2008 saw Buffett agree to acquire General Electric’s (GE) preferred stock, including attractive incentives such as an option to buy three billion GE shares and receive a 10% dividend. Meanwhile, in February 2009, he reduced some of his portfolio holdings, selling portions of his Procter & Gamble Co. and Johnson & Johnson shares.

During these turbulent times, some of Buffett’s major holdings, including those in The Coca-Cola Company, were scrutinized. He reflected on the challenges of discerning when to sell in the company’s 2004 annual report, emphasizing the certainty of uncertainties when looking to the future.

In March 2009, during a cable television interview, Buffett succinctly described the economic condition, asserting that it had “fallen off a cliff” and expressing concerns over a potential re-emergence of the painful stagflation seen in the 1970s. Through the complex web of financial downturn, Buffett’s decisions, both lauded and critiqued, and the oscillation of his wealth painted a vivid tapestry of the complexities and volatilities inherent in navigating through a financial crisis. His journey during 2007–08 provides a compelling exploration of strategic decision-making amidst economic turbulence.

Resilient Capitalization of Berkshire Hathaway

A journey through financial peaks and valleys, Warren Buffett and Berkshire Hathaway, navigated the intricate tapestry of investments, diversifications, and strategic maneuvers during the post-financial crisis era.

In a defining moment on August 14, 2014, Berkshire Hathaway’s shares soared to $200,000 apiece, catapulting the company to a $328 billion capitalization. Despite Buffett’s philanthropic endeavors, which saw him donate a sizable portion of his stock to charities, he retained 321,000 shares, boasting a value of $64.2 billion. Nonetheless, the company faced scrutiny and was fined $896,000 for neglecting to report a share purchase in USG Corporation in December 2013.

Buffett took strides to diversify Berkshire Hathaway away from the financial industry, which became particularly evident through significant investments and acquisitions. The year 2009 witnessed a $2.6 billion investment in Swiss Re’s equity capital-raising campaign and a noteworthy $34 billion acquisition of Burlington Northern Santa Fe Corp. Alice Schroeder, author of  Snowball , highlighted that diversification away from the financial industry was a pivotal reason behind the Burlington acquisition.

Despite his acumen, Buffett admitted to miscalculations, as demonstrated in his frank confession to Berkshire investors regarding his investment in ConocoPhillips, acknowledging both the misjudgment of energy price trends and its financial impact on Berkshire. Meanwhile, the 2010 merger with Burlington Northern Santa Fe Railway (BNSF), valued at approximately $44 billion, further expanded Berkshire’s portfolio.

Advocacy and Critique Amidst Financial Navigation

Buffett didn’t shy away from defending credit-rating agencies during the U.S. financial crisis, dubbing the bubble as a “mass delusion.” This narrative continued with a humorous yet pointed stance against Goldman Sachs when the Federal Reserve approved their buy-back of Berkshire’s preferred stock in Goldman in 2011. Buffett jested that he’d be more challenging to find than Osama bin Laden, illustrating his reluctance to relinquish a stock that brought in daily dividends of $1.4 million.

Investments in Tech and Media

Buffett, traditionally averse to tech investments due to his proclaimed lack of understanding, surprised the investment world by acquiring 64 million International Business Machine Corp (IBM) shares around November 2011. He praised IBM’s commitment to its corporate clients and explicit strategic trajectory. Meanwhile, 2012 saw Buffett delve into media, acquiring Media General, which consisted of 63 newspapers in the southeastern U.S., and later adding to BH Media Group’s portfolio with the acquisition of the  Press of Atlantic City  in 2013.

Reflecting on Wealth, Society, and Success

While addressing Georgetown University students in September 2013, Buffett analogized the U.S. Federal Reserve to a hedge fund and expressed concerns regarding wealth equality in society, emphasizing the imperative to ensure equitable distribution amidst abundance. His advocacy for social responsibility did not hinder Berkshire Hathaway’s financial performance – the company recorded a $6.4 billion net profit in Q2 2014, marking the highest profit in three months in its history.

Through the lens of strategic acquisitions, confessions of miscalculations, unexpected tech investments, and thought-provoking reflections on wealth and society, Buffett and Berkshire Hathaway etched a multifaceted narrative against the backdrop of the post-2007 financial landscape, epitomizing resilience and calculated risk in corporate leadership.

Warren Buffett’s Investment Philosophy

Warren Buffett continuously imparts his investment wisdom to the financial community through various writings, including his annual reports and numerous articles. In his notable correspondence with shareholders and a poignant piece in  Fortune  (1977), he dissected the destructive impact of inflation on capital, elucidating its covert yet influential capability to erode savings. His analogy brilliantly paints inflation as a tax, highlighting its capacity to indiscriminately consume capital, affecting individuals and investors across the spectrum.

“The arithmetic makes it plain that inflation is a far more devastating tax than anything that has been enacted by our legislatures. The inflation tax has a fantastic ability to simply consume capital. It makes no difference to a widow with her savings in a 5 percent passbook account whether she pays 100 percent income tax on her interest income during a period of zero inflation or pays no income taxes during years of 5 percent inflation.” – Buffett,  Fortune (1977)

The Argument Against the Efficient-Market Hypothesis

In “ The Superinvestors of Graham-and-Doddsville ,” Buffett delivered a compelling counterargument to the academic efficient-market hypothesis, asserting that surpassing the S&P 500 was far from mere serendipity. He validated his argument by spotlighting stellar results achieved by several disciples of the Graham and Dodd value investing paradigm, such as Walter J. Schloss and Charlie Munger. A 1999  Fortune  article  also hosted his cautionary perspective regarding investor expectations and the equities market, urging circumspection concerning anticipated returns and highlighting the potential realities of market dynamics.

Championing Index Funds Over Active Management

While extending his advocacy for index funds, Buffett emphasized their viability for those uninterested or unable to manage their finances actively. His skepticism towards active management’s ability to consistently outshine the market is evident through his advice to individuals and institutions to navigate low-cost index funds that track broad, diverse market indices. In a practical demonstration, his bet in 2007, asserting that a straightforward S&P 500 index fund would outclass hedge funds, particularly those levying exorbitant fees, saw fruition a decade later, as the index fund surpassed every hedge fund that took the bet against him.

A Skeptical Approach Towards Investment Banks

Buffett’s discernable reluctance  to engage the services of investment banks, detailed across various platforms such as  Barron’s , Insider, and Seeking Alpha, further underpins his investment philosophy, which often sidesteps conventional Wall Street approaches. His cautionary tales and investment maneuvers underscore a philosophy that navigates through the financial seas with a prudently skeptical eye on popular trends and an unwavering belief in foundational investment principles.

Buffett’s philosophy of investment, permeated with sensible advice, caution against unrealistic expectations, and pragmatic investing approaches, consolidates his position as an investor and a philosopher of prudent and astute financial management. His advocacy for understanding the silent devastation of inflation, skepticism towards active investment management, and cautious, often contrarian, stance towards conventional financial norms shape a narrative that champions skepticism towards prevailing investment norms and adherent belief in foundational, tried-and-true investing principles. The best chance to deploy capital is when things are going down. – Warren Buffett Share on X

Personal Life and Quirks

Warren Buffett’s romantic pursuit in 1949 shaped a musical hobby that would stick with him. After attempting to woo a young woman enamored by a ukulele-playing boyfriend, he purchased one of the instruments, unknowingly sowing seeds for a lifelong passion for the ukulele. His connection with the instrument transcended various aspects of his personal and professional life, from serenading his beloved Susan Thompson to performances at shareholder meetings, even leading to the commission of custom ukuleles from Dairy Queen by Dave Talsma.

Marriage and Family Dynamics

Buffett and Susan Thompson married in 1952, crafted a unique relationship that permitted distance and companionship. After bearing three children, Susie, Howard, and Peter, they lived separately from 1977 but sustained their marriage until Susan died in 2004. Buffett later married Astrid Menks, his long-term companion since Susan’s departure, in a relationship triangulated with mutual respect and unconventional familial love, embodied in their collective signatures on Christmas cards as “Warren, Susie, and Astrid.”

Lifestyle Choices

Despite being one of the wealthiest individuals globally, Buffett’s modest living is evidenced by his relatively meager salary compared to other CEOs, his residence in a home bought for $31,500 in 1958, and his previous practical use of an old Nokia flip phone. While he splurged on a private jet in 1989, naming it “The Indefensible” in a rare, extravagant deviation, his financial decisions and lifestyle largely mirror a pragmatic and unostentatious philosophy.

Sports Activity

Buffett’s leisure includes a sincere dedication to the bridge card game, partnering with Bill Gates, and dedicating approximately 12 hours weekly. His enthusiasm for Nebraska football has been palpable, with notable support for coach hires and active game attendance. He even lent his persona to the animated series “Secret Millionaires Club,” providing financial enlightenment through animated adventures alongside his associate Charlie Munger.

Despite a stage I prostate cancer diagnosis in 2012, Buffett has demonstrated remarkable resilience, completing his radiation treatments with energy and optimism intact. His ability to navigate this health crisis has been marked with an indomitable spirit, maintaining a “100 percent” energy level and joy after his treatment cycle.

From Coca-Cola to Unexpected Kinships

From his face gracing Cherry Coke products in China (sans compensation) to a distant relation to former President Barack Obama and a jovial pseudo-kinship with singer-songwriter Jimmy Buffett, Warren’s life and connections weave a rich, variegated tapestry. His blend of business acumen with humor in speeches, daily newspaper habits, and readings from The Bible to Mae West sprinkle additional flavors into his wholesome, multifaceted persona. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1. – Warren Buffett Share on X

Wealth, Rankings, and Public Perception

• In 2008, Forbes declared Warren Buffett the world’s wealthiest individual, boasting a net worth of around $62 billion.
• After generous charitable contributions, he held the title of the second-wealthiest American in 2009, with a net worth of $37 billion.
• By September 2013, his net worth had escalated to $58.5 billion.
• Achievements include being titled the top money manager of the Twentieth Century in 1999 and being featured on Time’s 100 Most Influential People in 2007.
• President Barack Obama awarded Buffett the Presidential Medal of Freedom in 2011.

Philanthropy and Charitable Endeavours

• Buffett intended to bequest his fortune to charitable efforts and announced in June 2006 a plan to donate 83% of his wealth to the Bill & Melinda Gates Foundation (BMGF).
• His pledged donation, equivalent to 10 million Berkshire Hathaway Class B shares (approximately $30.7 billion as of June 23, 2006), remains one of the largest in history.
• Buffett promised that BMGF would annually receive 5% of the total beginning in 2006, subject to specific conditions related to the foundation’s status and charitable activities.
• Although he joined the BMGF board, Buffett did not intend to participate actively in the foundation’s investment actions.
• Buffett resigned as a trustee from the Gates Foundation on June 23, 2021.
• Previously, most of Buffett’s fortune was intended to go to his Buffett Foundation.

Generosity and Initiatives

• His first wife’s estate, worth $2.6 billion, was directed to the Buffett Foundation upon her death in 2004.
• Buffett also committed $50 million to the Nuclear Threat Initiative and served as an adviser starting in 2002.
• He auctioned several items and experiences, including a car and luncheons, to raise money for charities like Girls, Inc. and the Glide Foundation.

The “Super-Rich” Movement

• Ralph Nader’s book, Only the Super Rich Can Save Us , which imagines a billionaire-led movement including Buffett, prompted a real-life response from Buffett.
• In 2010, Buffett, Bill Gates, and Mark Zuckerberg initiated the “Gates-Buffett Giving Pledge,” committing to donate at least half of their wealth to charitable causes and encouraging other affluent individuals to do the same.

Contributions to Family Foundations

• The Susan Thompson Buffett Foundation, Sherwood Foundation, Howard G. Buffett Foundation, and NoVo Foundation are among the family foundations supported by Buffett.
• In November 2022, Buffett donated $750 million in Berkshire Hathaway shares to four family-run charitable foundations.

Massive Charitable Donations

• In 2018, Buffett, after making close to $3.4 billion in donations, secured the 3rd position in Forbes’ List of Billionaires 2018.
• As of 2023, Buffett has donated over $50 billion to various charitable causes.

Buffett’s commitment to philanthropy has been consistent and notable, with his financial engagements and charitable acts significantly impacting various causes and organizations. His actions have also encouraged other wealthy individuals to contribute toward societal and global betterment.

Political and Public Policy Views

• Warren Buffett has actively participated in political matters and publicly endorsed various candidates, including Barack Obama and Hillary Clinton.
• He has been candid about his political views. He has engaged in various public challenges and discourses, such as challenging Donald Trump to release his tax returns and disclosing his own.
• Buffett was even mentioned as a potential Secretary of the Treasury and an economic advisor during the 2008 U.S. presidential debates.
• He provided financial advice to Arnold Schwarzenegger during the 2003 California gubernatorial election.

Health Care Views

• Buffett perceives the health care reform under President Obama as insufficient for dealing with U.S. health care costs but supports its aim of widening health insurance coverage.
• He likened health care costs to a tapeworm, impairing U.S. economic competitiveness by elevating manufacturing costs.
• He advocates for other nations’ efficient health care systems, which spend less with better outcomes.
• He also criticizes the U.S. medical industry’s incentive systems and has discussed unwarranted variation in Medicare expenditures.

Population Growth and Philanthropy

• Buffett has shared his concern about unchecked population growth and is a longtime supporter of family planning.
• He has met with other billionaires like Oprah Winfrey , Michael Bloomberg, and David Rockefeller, Jr., to discuss philanthropy and societal issues.
• The Buffett Foundation has donated significant amounts to family planning, including supporting Planned Parenthood.

Tax Perspectives and Economic Views

• Buffett has been vocal about his views on taxes, expressing the contradictions of his relatively low tax rate compared to his employees and supporting the “Buffett Rule.”
• He advocates for the inheritance tax, citing that its repeal would harm equitable wealth distribution.
• Buffett also has viewpoints on economic aspects, such as government involvement in gambling and legalizing casinos.

Investments in Chinese Companies

• Historically, Buffett has shown bearish tendencies on the dollar and a skeptical view of gold as an investment, critiquing its non-productive nature.
• His investment strategies include notable stints in foreign companies like PetroChina Company Limited and BYD Company. In October 2008, Warren Buffett invested $230 million in BYD Company, a battery maker that runs a subsidiary of electric automobile manufacturer BYD Auto. The investment yielded over a 500% return in less than a year.
• He has also exhibited concern and awareness regarding socioeconomic matters related to his investments.

Tobacco and Coal Industries

• Buffett has expressed contrasting views on the tobacco industry, recognizing its lucrative yet morally and socially questionable standing.
• Concerning coal, Buffett’s PacifiCorp canceled several proposed coal-fired power plants due to regulatory and public pressures.

Renewable Energy and Environmental Concerns

• Buffett and his companies have been involved in dialogues and initiatives concerning renewable energy, including discussions about hydroelectric dams and their environmental impact.
• Native American tribes and salmon fishermen have approached him regarding environmental and economic matters related to PacifiCorp’s dams on the Klamath River.

Views on Stock Options and Technology Investments

• Buffett has advocated for stock option expensing on corporate income statements and has spoken against legislation that defies logical and mathematical principles.
• Regarding technology investments, he has generally avoided investing in social media companies and has expressed skepticism about the future value of companies like Facebook and Google.

Bitcoin and Cryptocurrencies

• Buffett has conveyed skepticism about Bitcoin and other cryptocurrencies, refraining from investing in them and predicting an unfavorable outcome for the cryptocurrency craze.

Buffett’s varied and robust perspectives on numerous issues reflect a blend of economic prudence, ethical considerations, and speculative skepticism, navigating through industry, politics, and public policy sectors.

Film and Television

Aside from countless television appearances on various news programs, Buffett has appeared in numerous films and TV programs, both documentary and fiction. Some film and television cameos he has made include Wall Street: Money Never Sleeps (2010), The Office (U.S.), All My Children , and Entourage (2015). He has been a guest on Charlie Rose ten times and was the subject of the HBO documentary Becoming Warren Buffett (2017) and the BBC production The World’s Greatest Money Maker (2009).

Bibliography

In October 2008, USA Today reported at least 47 books were in print with Buffett’s name in the title. The article quoted the CEO of Borders Books, George Jones, saying that the only living persons named in as many book titles were U.S. presidents, world political figures, and the Dalai Lama. Buffett said that his favorite is a collection of his essays called The Essays of Warren Buffett, which he described as “a coherent rearrangement of ideas from my annual report letters.”

Publications by Buffett:

• The Essays of Warren Buffett: Lessons for Corporate America , Warren Buffett and Lawrence A. Cunningham, The Cunningham Group; revised edition (April 11, 2001).
• The Essays of Warren Buffett: Lessons for Corporate America, Second Edition , Warren E. Buffett and Lawrence A. Cunningham, The Cunningham Group; 2nd edition (April 14, 2008).

Warren Buffett’s biography is a remarkable tale of sustained success and strategic brilliance in global finance. His journey highlights the integration of traditional and innovative investment strategies and is an exemplary financial success story for experienced and aspiring investors. As we delve into his life’s journey, it becomes clear that Buffett is not only a financial wizard but also a timeless educator who emphasizes that success results from opportunism, strategic foresight, and unwavering determination.

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Warren Buffett just became the longest-serving CEO of an S&P company. Take a look inside his incredible life and career.

• Leslie Wexner, the CEO and founder of Victoria's Secret's parent company L Brands, recently announced that he would be stepping down after 57 years on the job. He had the longest tenure amongst any current CEO of an S&P company.
• With Wexner's departure, Warren Buffett is now the longest-tenured CEO in the S&P 500 . He's been the CEO of Berkshire Hathaway for 50 years.
• The distinction is particularly impressive given that the average tenure of a CEO was reported to be five years between 2015 and 2017. 
• Buffett's current net worth is estimated at $90 billion , according to Forbes.
• Take a look inside Buffett's incredible life and how he got to where he is today.
• Visit Business Insider's homepage for more stories .

In February 2020, Warren Buffett became the longest-tenured CEO of an S&P 500 company. With a net worth of $90 billion, he is also one of the richest people in the world, something he had been working towards for much of his almost-90-year life.

Buffett gained the title after Les Wexner, 82, of L Brands, the parent company of Victoria's Secret, stepped down as CEO . Wexner had held the position for 57 years.

Sycamore Partners had recently acquired a majority of Victoria's Secret stocks. Wexner and disgraced financier Jeffrey Epstein reportedly had a close relationship, attracting controversy in the months preceding his resignation.

Buffett has led Berkshire Hathaway for 50 years and amassed a massive fortune starting with business ventures in his teen years. 

Buffett was born in 1930 in Omaha, Nebraska.

The "Oracle of Omaha" was born to Howard and Leila Buffett. His father was a four-term US congressman from Nebraska and a stockbroker.

While most kids were playing stickball out in the street, Buffett was rubbing elbows with Wall Street's most powerful players from an early age.

At age 10, Buffett had his "road to Damascus" moment, on Wall Street.

During a visit to New York City, Buffett and his father joined At Mol, a Dutchman who was a member of the New York Stock Exchange , for lunch.

"After lunch, a guy came along with a tray that had all these different kinds of tobacco leaves on it," Buffett recalled. "He made a cigar for Mr. Mol, who picked out the leaves he wanted. And I thought this is it. It can't get any better than this. A custom-made cigar."

It was at that moment Buffett realized he would dedicate his life to making money.

Buffett caught the investing bug early. When he was 11 years old he purchased his first stock.

He bought three shares of Cities Services Preferred at $38 per share. The young Buffett held on to them despite a quick price drop, to $27 per share, but sold them as soon as they reached $40.

Buffett's small profit could have been tremendous if he had waited it out a little longer, as the price of Cities Services Preferred's stock ultimately soared to nearly $200 per share.

The experience imparted an important financial lesson, which has informed his investment decisions to this day: Buy and hold .

Buffett's hustle game was strong as a youth. While he was a high-school student he and a friend operated a lucrative pinball business. He also took on odd jobs like delivering newspapers and washing cars.

When Buffett was in high school he pitched the following business scheme to his friend Don Danley after he purchased a $25 used pinball machine :

"I bought this old pinball machine for 25 bucks, and we can have a partnership. Your part of the deal is to fix it up. And lookit, we'll tell Frank Erico, the barber, 'We represent Wilson's Coin-Operated Machine Company, and we have a proposition from Mr. Wilson. It's at no risk to you. Let's put this nickel machine in the back, Mr. Erico, and your customers can play while they wait. And we'll split the money."

The duo struck a deal with Erico and the machine was an immediate hit, raking in $4 bucks on the first night.

Rather than spending their earnings, the young partners reinvested it in more machines.

In a couple of months, Buffett was a pinball kingpin with several machines operating at barbershops across his town. Buffett sold the business for over $1,000 after a year.

In addition to the pinball business, Buffett undertook a number of odd business ventures during his childhood such as delivering newspapers, selling gum and soda, and washing cars.

Through his various business endeavors, Buffett amassed a small fortune by the time he was 16. In fact, he was so successful that he was reluctant to go to college.

He accumulated so much money as a teenager that he didn't see the point in accepting his offer of admission from the prestigious Wharton School of Business at the University of Pennsylvania.

But he ultimately gave in to the will of his father and went off to college, only to return to Nebraska two years later, at which point he attended the University of Nebraska.

After completing his undergraduate studies, Buffett moved to New York to attend Columbia's School of Business, where he met his mentor and future employer Benjamin Graham.

The catalyst for Buffett's decision to move to the Big Apple was a well-known Wall Street book titled, "The Intelligent Investor." Buffett, an avid reader, said he first picked up the book when he was 19, and its philosophy of "value investing" changed his life . 

The author of the book, Benjamin Graham, went on to become Buffett's professor at Columbia Business School. After he earned his master's degree in 1951, Buffett moved back to work for Buffett-Falk & Co., his father's brokerage firm in Omaha.

Buffett married his wife Susan Thompson in 1952. The two had an open marriage that lasted until her death in 2004.

In 1952, Buffett married Susan "Susie" Thompson. The couple had three children: Susan, Howard, and Peter.

Warren and Susie had a complicated relationship , to say the least. Although they remained married until Susan's death in 2004, they didn't live together for more than half of their marriage.

Susan Buffett left her husband when she was 45. She remained married, to Warren, but lived in San Francisco. The two remained close and spoke frequently on the phone and even went on vacations together. Ultimately it was Susie who set Warren up with Astrid Menks, a waitress who moved in with Buffett and then married him after Susie died.

Buffett moved back to New York City in 1954 after accepting a job with Benjamin Graham.

Graham offered Buffett a job in New York City so the family packed their bags and moved there from Omaha, Nebraska in 1954. Buffett worked for his mentor for two years as an analyst at Graham-Newman Corp., where he made $12,000 a year.

In 1956, Buffet started his own investment firm Buffett Partnership Limited, which ran for 13 years.

In the years that the firm was active, it generated over a hundred million in assets. The initial investment in the firm was a little over $100,000.

In 1969, Buffett closed the partnership and took on a leadership role with Berkshire Hathaway, a position he holds to this day.

Buffett started buying up shares of Berkshire Hathaway, a textile manufacturing firm, during the early 1960s and ultimately took complete control of the business.

The firm now offers investment services and is valued at $516 billion .

Throughout the early '80s, Buffett steadily grew his multimillion-dollar net worth and became a billionaire in 1986.

In 1982, Buffett's net worth stood at $376 million. It increased to $620 million in 1983.

And in 1986, at 56, Buffett became a billionaire , despite his humble $50,000 salary from Berkshire Hathaway.

Buffett bought over $1 billion in Coca-Cola stocks between 1988 and 1994.

Berkshire Hathaway currently owns about 10% of Coca-Cola , which amounts to $22 billion. Buffett is said to drink five cans of Coke a day, after having spent his early years drinking Pepsi.

In 2008, Buffett became the richest person in the world.

Forbes named Buffett as the richest person in the world in March 2008 with an estimated wealth of $65 billion. He dethroned Bill Gates who had held that spot for 13 years. Gates ranked third behind Buffett and Mexican billionaire Carlos Helu.

Gates regained his spot as the richest person the following year. Forbes currently ranks Jeff Bezos at the top of the list.

In 2010, Buffett and Bill Gates created the Giving Pledge, a group of some of the richest people in the world who have made a commitment to donate a majority of their wealth to charity.

Buffett's frugality is a trademark of his "brand ." Until very recently , the 89-year-old used a flip phone and prefers to travel on public transportation. But this does not mean Buffett is a stingy miser.

In 2019, he beat his own personal philanthropic record by donating $3.6 billion worth of Berkshire Hathaway stocks to five charities, including The Bill and Melinda Gates Foundation. 

In addition, Buffett and fellow billionaire Bill Gates agreed to donate at least half of their fortunes to charity when they created and signed the Giving Pledge .

Since 2010, over 150 people have made the pledge, including Facebook's Mark Zuckerberg.

Buffett was presented with the Presidential Medal of Freedom by President Obama in 2011 for his commitment to philanthropy.

The group honored that year also included cellist Yo-Yo Ma and Maya Angelou. President Obama called the recipients "some of the most extraordinary people in America and around the world."

In 2018, Buffett tried to invest in Uber but was unsuccessful. He was also outbid for an energy company in 2017.

Buffett's recent dealmaking efforts have run into a few roadblocks. He was outbid for the energy company Oncor in 2017. The Buffett-backed conglomerate Kraft Heinz  called off plans to merge with Unilever , a deal valued at $143 billion. Buffett tried and failed to invest $3 billion in Uber, in 2018 .

In his  company's annual letter in 2018 , Buffett lamented the fact that high stock valuations derailed nearly every investment idea the firm had in 2017.

The requirement of a sensible purchase price "proved a barrier to virtually all deals we reviewed in 2017, as prices for decent, but far from spectacular, businesses hit an all-time high. Indeed, the price seemed almost irrelevant to an army of optimistic purchasers," he said. 

In 2018, Buffet promoted two vice-chairs to Berkshire Hathaway's board. This fueled speculation that the two men might potentially succeed him one day.

In January 2018, Buffett promoted two senior executives — Greg Abel and Ajit Jain — to Berkshire's board of directors.

Abel was appointed as Berkshire's vice chairman for non-insurance business operations, and Jain as vice chairman, insurance operations. Buffett described the appointments as "part of a movement toward succession," providing the clearest hint of the pool of candidates he's considering to replace himself.  

Abel and Jain each made $18 million in 2018 after they were appointed to the board.

This post was originally authored by Frank Chaparro.

• Main content

Warren Buffett

• Born August 30 , 1930 · Omaha, Nebraska, USA
• Birth name Warren Edward Buffett
• The Oracle of Omaha
• Height 5′ 10″ (1.78 m)
• Warren Edward Buffett born in Omaha ( August 30, 1930 ). He developed an interest in business and investing in his youth, eventually entering the Wharton School of the University of Pennsylvania in 1947 before transferring and graduating from University of Nebraska-Lincoln at the age of 19. Buffett went on to enroll and graduate from Columbia University where he learned and eventually molded his investment philosophy around a concept pioneered by Benjamin Graham-value investing. He attended New York Institute of Finance to specialize his economics background and soon after began various business partnerships, including one with Graham. After meeting Charlie Munger, Buffett created the Buffett Partnership. His firm would eventually acquire a textile manufacturing firm called Berkshire Hathaway and assume its name to create a diversified holding company. Filmography : Buffett's work even earned him a glamorous foray into the movie business when he made a appearance in the 2015 movie 'Wall Street: Money Never Sleeps' (2010), 'The Billionaires' Pledge' (2012) and 'The Berkshire Apprentice' (2016). HBO recently created a documentary "Becoming Warren Buffett,"( January, 2017 ) which provides a fresh overview of the "Oracle of Omaha," the subject of a best-selling 'The Snowball' ( 2008 ) biography for which he also extensively cooperated. Directed by Peter Kunhardt, whose film subjects have included President Richard Nixon and media mogul Oprah Winfrey, the documentary was largely narrated by Buffett and contains interviews with people close to him, including his sisters, three children, Berkshire Vice Chairman Charlie Munger, and philanthropists Bill and Melinda Gates. - IMDb Mini Biography By: Jayanta Pramanik.
• Spouses Astrid Menks (August 30, 2006 - present) Susan Thompson (April 19, 1952 - July 29, 2004) (her death, 3 children)
• Children Howard Buffett Peter Buffett Susie Buffett
• Folksy humor
• Refered to as "Wizard of Omaha or Oracle of Omaha."
• Known for his clean business practices and advocacy of transparency and integrity in corporations.
• Always flies coach when traveling.
• He is a huge fan of the series Breaking Bad (2008) .
• According to Forbes, he became the world's richest person with an estimated net worth of $62 billion (2008).
• He still lives in the house in Omaha, Nebraska that he bought in 1958.
• It is better to be approximately right than precisely wrong.
• You only have to do a very few things right in your life so long as you don't do too many things wrong.
• Nothing sedates rationality like large doses of effortless money.
• Investors... should try to be fearful when others are greedy and greedy when others are fearful.
• [on raising taxes on the wealthiest people] If you give me a choice between taking $1000 from twenty million families or hitting 50,000 people who shuffle money around all day, I'll take it from the people who shuffle money.

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The incredible life and career of Warren Buffett, the billionaire every investor looks to for inspiration

The "oracle of omaha" was born in 1930 in omaha, nebraska, to howard and leila buffett. his father was four-term us congressman from nebraska and a stockbroker..

While most kids were playing stickball out in the street, Buffett was rubbing elbows with Wall Street's most powerful players.

At age 10, Buffett had his "road to Damascus" moment, on Wall Street.

During a visit to New York City, Buffett and his father joined At Mol, a Dutchman who was a member of the New York Stock Exchange , for lunch.

"After lunch, a guy came along with a tray that had all these different kinds of tobacco leaves on it," Buffett recalled. "He made a cigar for Mr. Mol, who picked out the leaves he wanted. And I thought, this is it. It can't get any better than this. A custom-made cigar."

It was at that moment Buffett realized he would dedicate his life to making money.

Source: Business Insider

Buffett caught the investing bug early. When he was 11 years old he purchased his first stock.

He bought three shares of Cities Services Preferred at $38 per share. The young Buffett held on to them despite a quick price drop, to $27 per share, but sold them as soon as they reached $40.

Buffett's small profit could have been tremendous if he had waited it out a little longer, as the price of Cities Services Preferred's stock ultimately soared to nearly $200 per share.

The experience imparted an important financial lesson, which has informed his investment decisions to this day: Buy and hold .

Source: Biography.com

Buffett's hustle game was strong as a youth. While he was a high-school student he and a friend operated a lucrative pinball business.

When Buffett was in high school he pitched the following business scheme to his friend Don Danley after he purchased a $25 used pinball machine :

"I bought this old pinball machine for 25 bucks, and we can have a partnership. Your part of the deal is to fix it up. And lookit, we'll tell Frank Erico, the barber, 'We represent Wilson's Coin-Operated Machine Company, and we have a proposition from Mr. Wilson. It's at no risk to you. Let's put this nickel machine in the back, Mr. Erico, and your customers can play while they wait. And we'll split the money."

The duo struck a deal with Erico and the machine was an immediate hit, raking in $4 bucks on the first night.

Rather than spending their earnings, the young partners reinvested it in more machines.

In a couple of months, Buffett was a pinball kingpin with several machines operating at barbershops across his town. Buffett sold the business for over $1,000 after a year.

In addition to the pinball business, Buffett undertook a number of odd business ventures during his childhood such as delivering newspapers, selling gum and soda, and washing cars.

Through his various business endeavors, Buffett amassed a small fortune of $53,000 (in today's money) by the time he was 16.

He accumulated so much money as a teenager that he didn't see the point in accepting his offer of admission from the prestigious Wharton School of Business at the University of Pennsylvania.

But he ultimately gave into the will of his father and went off to college, only to return to Nebraska two years later, at which point he attended the University of Nebraska.

Source: New Republic

After completing his undergraduate studies, Buffett moved to New York to attend Columbia's School of Business.

The catalyst for Buffett's decision to move to the Big Apple was a well-known Wall Street book titled, "The Intelligent Investor." Buffett, an avid reader, said he first picked up the book when he was 19, and its philosophy of "value investing" changed his life .

He enrolled at Columbia after he learned that the book's author, Ben Graham, was a professor there. Despite the fact that Buffett was the sole student to earn an A+ in one of Graham's classes, Graham refused to hire Buffett at his firm. He even advised Buffett to completely avoid a career on Wall Street .

As such, after he earned his master's degree in 1951, Buffett moved back and sold securities for Buffett-Falk & Co., his father's brokerage firm in Omaha, for three years.

Source: Biography.com, CNBC

Buffett got hitched in 1952.

In 1952, while he was working for his father's company, Buffett married Susan "Susie" Thompson. The couple had three children: Susan, Howard, and Peter.

Things were not easy for the young couple right after their nuptials. They lived extremely modestly in a small three-room apartment, which they rented for $65 a month.

In 1957, Buffett purchased a five-bedroom home in Omaha for $31,500. He still lives there.

Warren and Susie had a complicated relationship, to say the least. Although they remained married until Susan's death in 2004, they didn't live together for more than half of their marriage.

Mrs. Buffett left her husband when she was 45. She remained married, to Warren, but lived in San Francisco. The two remained close and spoke frequently on the phone and even went on vacations together. Ultimately it was Susie who set Warren up with Astrid Menks, a waitress who moved in with Buffett and then married him after Susie died.

Source: Investopedia

Buffett moved back to the Big Apple.

Ultimately, Graham had a change of heart and in 1954 he offered Buffett a job in New York. So the family packed their bags and moved to the Big Apple.

Buffett worked for his mentor for two years as an analyst at Graham-Newman Corp., where he made the modern-day equivalent of $105,000 a year.

When Benjamin Graham closed his partnership in 1956, Buffett started his own company back in his beloved Omaha: Buffett Partnership Ltd.

He was a millionaire by age 32.

By the end of the 1950s, Warren had opened seven partnerships. He became a millionaire in 1962 as a result of his earnings from the partnerships he was involved in.

Source: thefamouspeople.com

Buffett merged all his partnerships into one and invested in a textile-manufacturing firm, Berkshire Hathaway.

In 1962, Buffett decided to merge all the partnerships into one and invested in a textile-manufacturing firm called Berkshire Hathaway . He started buying up shares of Berkshire Hathaway during the early 1960s and ultimately took complete control of the firm.

Today, the company has the highest stock price. As of February 2, 2017, it stood at a whopping $245,600 a share .

In the late 1960s, Buffett shifted Berkshire Hathaway from textiles to insurance.

For Buffett, the '80s were roaring.

While some were flaunting mullets, legwarmers, and neon attire, Buffett was making money. In 1982, Buffett's net worth stood at $376 million. It increased to $620 million in 1983.

And in 1986, at 56, Buffett became a billionaire , despite his humble $50,000 salary from Berkshire Hathaway.

Source: Valuewalk.com

Buffett owned about 7% of Coca-Cola Co. by 1988. It ended up being one of his best investments.

"Buffett's [$1 billion investment] in Coca-Cola grew nearly 16 times over the ensuing 27 years when accounting for dividends . This is an annualized gain of 11%, approximately."

In 2008, Buffett became the richest person in the world.

"He became the richest person in the world in 2008 with a total net worth estimated at $62 billion by Forbes, overtaking Bill Gates who had been the No.1 on Forbes list for the past 13 years. The very next year, Gates regained the first position and Buffett moved to second place."

In 2010, Buffett and Bill Gates created the Giving Pledge.

Buffett's frugality is a trademark of his "brand." The 89-year old doesn't own a cellphone and prefers to travel on public transportation. This does not mean Buffett is a stingy miser.

In 2016, he beat his own personal philanthropic record by donating $2.86 billion worth of Berkshire Hathaway stock to numerous charities, including The Bill and Melinda Gates Foundation. That donation brought his lifetime givings to more than $28.5 billion.

In addition, Buffett and fellow billionaire Bill Gates agreed to donate at least half of their fortunes to charity when they created and signed the Giving Pledge .

Since 2010, over 150 people have made the pledge, including Facebook's Mark Zuckerberg.

Source: Forbes

Buffett was presented with the Presidential Medal of Freedom by President Obama in 2011.

Source: WhiteHouse.gov

Buffett has purchased $12 billion of stock since Trump's win in November.

Despite his liberal leanings and reservations about President Trump, Buffett appears to be bullish about the new administration.

In a recent interview with Charlie Rose , Buffett said that Berkshire Hathaway purchased about $12 billion of common stocks since Trump's surprise victory in November.

According to Investopedia, "That is over 200 percent more than the total stocks purchased by Berkshire in the first three quarters of 2016, in which the firm bought only $5.2 billion in shares."

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• U.S. History

Warren Buffett Biography: 6 Important Achievements

by World History Edu · October 18, 2020

Warren Buffett Accomplishments

From his father’s small stock brokerage shop in Omaha to famously being called the “Oracle of Omaha”, check out these six very important achievements of Warren Buffett – one of the greatest investors of all time.

Warren Buffett: Fast Facts

Born : Warren Edward Buffett

Date of Birth : August 30, 1930

Parents : Howard Buffett and Leila Stahl Buffett

Education : Columbia Business School; University of Nebraska; Wharton School of the University of Pennsylvania; Woodrow Wilson High School; Rose Hill Elementary School

Spouse : Susan Thompson (1952-2004); Astrid Menks (married in 2006)

Children: Susan, Howard, Peter

Most famous for : Chairman and CEO of Berkshire Hathaway

Zodiac sign:  Virgo

Nickname: Oracle of Omaha; Sage of Omaha

Warren Buffett on the benefits of dedication and concentration

Started investing right from an early age

Born in Omaha, Nebraska, Warren Buffett’s passion for entrepreneurship and stock trading was nurtured by his father, Howard Buffett – a U.S. congressman. His profile in his senior yearbook read “likes math; a future stockbroker”. He gained an enormous amount of experience while working in his father’s stockbrokerage firm.

In his teens, he made close to $200 a month delivering The Washington Post newspapers. Other streams of income came from investments he made in his father’s business. At one point in time, he also sold chewing gum, golf balls, stamps, soda drinks, and weekly magazines, which he delivered door to door. As at the time he was graduating from college, he had close to $10,000 saved in the bank.

He drew a lot of inspiration from a number of business books at the Omaha public library. Arguably, his favourite was One Thousand Ways to Make $1,000 (1936) written by Frances Minaker. And at just the age of 11, he bought three shares of a company called Cities Service.

Such was his passion that he contemplated going straight into business after high school; however, his father insisted that the young Buffett first proceeds to college.

A big admirer of value investing

After graduating from the University of Nebraska with a Bachelor of Science in Business Administration, Warren Buffet proceeded to enrol at Columbia University to pursue a Master of Science in Economics. He chose Columbia because he wished to be mentored by renowned economist Benjamin Graham.

Considered the father of Value Investing, Graham mentored Buffett, exposing him to sound investment philosophies that seek out companies with high intrinsic value. Buffett’s guiding principle in investment is that: He scans the market to find stocks whose prices are low compared to their intrinsic value.

Established Buffett Partnership Ltd

A few years after graduate school, Buffett successfully secured a job at the firm of his mentor Benjamin Graham. Shortly after, he went on to found Buffett Parntership Ltd. Beginning with three partnerships in 1957, Buffett put in the hours day in, day out; and by 1960, his firm could boast of seven partnerships.

In the next couple of years, he continued to grow his stake in the partnership. And as the return of investment from his numerous portfolios kept increasing, Buffett’s worth crossed the 1 million-dollar mark.

Warren Buffett

Secured a controlling stake in Berkshire Hathaway

Buoyed on by successes in his partnerships, Buffet invested heavily in Berkshire Hathaway – a firm that would later become a colossal in media, energy, food and beverage industries of America. By the mid-1960s, he had taken control of the firm and even appointed Ken Chace to be its president.

Initially a textile business, Berkshire Hathaway gradually moved out of the textile business after Buffet’s arrival. In the years that followed, Buffett would steer the business into the insurance sector. Also, Berkshire Hathaway started buying shares in the Washington Post Company in 1973.

Thus as chairman and CEO, Buffett was able to turnaround the struggling fortunes of Berkshire Hathaway and make it the biggest holding company in the U.S. in terms of the volume of assets.

He consistently has a rich and diversified portfolio

Guided by the intrinsic value and management team of the firm, Buffett has over the past three decades acquired diversified business portfolio. Around 1988, he bought some stock from The Coca-Cola Company. His investment in this particularly company performed very properly.

One of the most generous philanthropists in the world

in 2006, Warren Buffett announced to the world that he intends leaving close to 85% of his shares in Berkshire Hathaway for charity. He promised to give much of that amount to the Bill and Melinda Gates Foundation. Considering how much those shares are worth, Warren Buffett’s donation to charity is seen as the biggest ever in history.

Awarded the Presidential Medal of Freedom

In addition to the numerous accolades he has won over the decades, Warren Buffett received the nation’s highest civilian honor – the Presidential Medal of Freedom – in 2011. The award, which was bestowed by U.S. President Barack Obama – was in recognition of his philanthropic works as well as his unrivalled successes in investments.

Tags: Berkshire Hathaway Entrepreneurs Sage of Omaha US-Omaha Warren Buffett

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Buffett Online

Fast facts about Warren Buffett

• Warren Buffett, known as the “Wizard of Omaha,” is one of the most successful investors on the planet.
• Warren Buffett’s net worth is $134.5 billion
• Buffett runs the Berkshire Hathaway conglomerate, which includes more than 60 companies, such as the insurance company Geico, battery manufacturer Duracell, railroad BNSF, etc.
• The son of a U.S. congressman, Buffett bought his first stock at age 11 and filed his first income tax return at age 13.
• In 2010 together with Bill Gates Buffet launched “Giving Pledge” campaign to encourage billionaires to donate half of his fortune to charity.
• Warren Buffett’s age is 93
• Warren Buffett’s source of wealth is Berkshire Hathaway
• Warren Buffett’s place of residence is the United States, Omaha (Nebraska)
• Warren Buffett citizenship is in the USA
• Warren Buffett marital status – Widower, remarried
• Number of children Warren Buffett has – 3
• Education Warren Buffett – Bachelor of Arts/Science, University of Nebraska-Lincoln; Master of Science, Columbia University

Rational people don’t risk what they have for what they don’t have and don’t really need. WARREN BUFFETT

Biography of Warren Buffett

Warren Buffett was born August 30, 1930 in the U.S., in Omaha, Nebraska. In 1942, when his father was elected Senator (he was re-elected 3 more times) to the U.S. Congress – Warren moved with his parents and two sisters to Washington.

Buffett got his interest in the stock market from his father, who worked as a broker in the stock market before his career as a politician. Warren made his first attempts at investments from a very young age. Already at the age of 11 he bought his first shares. They were preferred shares of the company Cities Service.

Buffett made money in high school, including delivering the Washington Post in the morning. By the time he graduated from college, he had saved $9,800 (that’s over $100,000 when adjusted for inflation today). Buffett was a true entrepreneur in his early youth, installing jukeboxes in bars, selling golf balls, etc.

After Buffett failed to get into Harvard, he decided to go to Columbia University Business School, since his idol, Benjamin Graham, taught there. Graham’s lectures at the time were legendary – he was not only an excellent lecturer and writer (his famous Securities Analysis and The Intelligent Investor have been in print for decades and are recognized as one of the best books for investors), but also a very successful practitioner. It is said that during his lectures Graham gave such valuable and relevant advice that one could immediately go to the stock exchange, follow his recommendations and make serious money!

After studying, Buffet worked as a securities salesman for three years, and then took a job as an investment analyst with Graham in his investment partnership Graham-Newman Corp. Interestingly enough, Buffett offered his services to Graham for free, understanding that the experience he would gain here was invaluable. In 1956, Benjamin Graham retires and closes his company. Buffett moves from New York back to his native Omaha and forms his own investment partnership. By then, by modern standards, Warren Buffett was already a millionaire.

Warren Buffett’s Personal Life

In 1952, Buffett married Susan Thompson. The following year their first child was born. In all, Susan and Warren had three children – Susan Alice Buffett, Howard Graham Buffett, and Peter Buffett.

Warren Buffett’s personal life was not easy. Marriage with Susan Thompson was not very smooth due to the fact that Warren was fully absorbed in his work. Gradually they became estranged from each other. In 1977 they began to live apart, although they did not officially divorce until Susan Buffett’s death from cancer in 2004.

In 2006 Warren Buffett married Astrid Menkes, whom he had lived with since his separation from Susan in 1977. Buffett in 2006 was 76 years old, his bride was sixty. Interestingly, it was Susan who introduced Buffett to Astrid Menkes before finally breaking up with him and leaving for California to try her luck in a singing career.

Warren Buffett’s early career

From 1956 to 1969, Buffett managed outside investors’ money (and his own) with an average annual return of 23.8% (before Buffett’s commission, the average annual return was 29.5%).

This staggering result was achieved because Buffett found extremely undervalued companies, bought their shares and tried to influence board actions so that the shares would rise in price. What Buffett was doing then is very similar to the actions of the so-called activist investors of today (Carl Icahn, Bill Eckman and others).

Warren Buffett’s first investors were his close relatives and friends. He also received commissions for successfully managing their money and as early as 1962 Buffett became a dollar millionaire (~$9.9 million including inflation for 2022).

Warren Buffett’s investment strategy

The biggest factor that influenced Warren Buffett’s investing principles was his studies and work for “the father of value investing” Benjamin Graham. It was Graham who coined the term.

Value investing is all about buying something (a security or an entire business) for less than its true value. This can be done either in times of general panic (when investors are certain of the end of the world and everything in the stock market is falling – such as the 2008-2008 crisis or the early 2020 coronavirus epidemic), or when investors misjudge the business prospects.

Graham’s investing philosophy was originally based on his personal investment experience during the Great Depression. At that time, the shares of many companies on the stock exchange were worth less than the cash in their accounts, minus all their debts. That is, these companies could close, pay off all their debts and stay in the black. So negative was the mood on the financial markets.

The main idea of investing is to look at stocks as a business, to use market fluctuations to your advantage, and to look for a margin of safety. That’s what Ben Graham taught. Even 100 years from now, these will be the basics of investing.

In 1959 Warren Buffett meets Charlie Munger. Meeting Munger determined many of Buffett’s future investment decisions, because Munger was an advocate of buying better and more promising companies. Buffett at that time was more focused on the search for cheap (in terms of ratio of price per share and assets behind that share) investments, which led him to Berkshire Hathaway.

Interesting facts about Warren Buffett

• In 1957 Warren Buffett bought a five-bedroom house in his hometown of Omaha, Nebraska for $31500. Today Buffett still lives in this house with his wife (of course, he has other real estate, which he occasionally uses, but it is believed that he spends most of his time in this house). According to various estimates the price of Warren Buffett’s house today is more than 650 thousand dollars.
• Up until 2020, Warren Buffett used an old Samsung flip phone. This year Buffett finally switched to a modern phone – he now uses the latest iPhone 11. But he only uses the phone to make calls.
• Warren Buffett loves to play bridge. He spends 12 or more hours a week playing bridge online and live. Often his playing partner is Bill Gates, with whom Buffett has been friends for many years.
• Warren Buffett spends 80% of his time reading. He reads reports of public companies (whose shares he owns or intends to own), reports of companies belonging to Berkshire Hathaway empire, newspapers, books, etc. Buffett does not have a computer in his office, but he has an iPad which he uses for reading.
• If you had invested just $1,000 in Berkshire Hathaway stock in 1965 (when Buffett became chairman and CEO), you would have over $32 million today!
• Warren Buffett’s annual salary is only $100,000 and has not changed in many years.
• An investment in Apple stock was one of the most profitable for Warren Buffett – a net profit of over $80 billion!

Sources: Wikipedia , CNBC , New York Times , Ivey Business School , Berkshire Hathaway , Roger Lowenstein, Alice Schroeder, Carol Loomis.

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Warren Buffett: An Illustrated Biography of the World's Most Successful Investor Paperback – Illustrated, December 14, 2004

"Warren Buffett - The Oracle of Everything. He has been right about the stock market, rotten accounting, CEO greed, and corporate governance. The rest of us are just catching on." ―Fortune

"Warren Buffett has turned value investing into an art form, piling up the world's second largest individual fortune and persuading millions to mimic the low-tech, buy-and-hold style of stock picking he practices at Berkshire Hathaway." ―Time

"Buffett and Munger are, without doubt, two of the greatest investors and capital allocators of all time, so investors would be well served to study their thinking carefully." ―The Motley Fool

"Warren Buffett - Ace stockpicker, and now, an empire-builder." ―BusinessWeek

• Print length 120 pages
• Language English
• Publisher Wiley
• Publication date December 14, 2004
• Dimensions 5.95 x 0.5 x 8.35 inches
• ISBN-10 0470821531
• ISBN-13 978-0470821534
• See all details

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Editorial Reviews

From the inside flap.

This is an entertaining and readable book that will be welcomed by both Buffett fans and the novice investor.

From the Back Cover

WARREN BUFFETT

Warren Buffett has made a name for himself as the most successful investor of the twentieth century. CNN

About the Author

Product details.

• Publisher ‏ : ‎ Wiley; 1st edition (December 14, 2004)
• Language ‏ : ‎ English
• Paperback ‏ : ‎ 120 pages
• ISBN-10 ‏ : ‎ 0470821531
• ISBN-13 ‏ : ‎ 978-0470821534
• Item Weight ‏ : ‎ 2.31 pounds
• Dimensions ‏ : ‎ 5.95 x 0.5 x 8.35 inches
• #3,113 in Biographies of Business & Industrial Professionals
• #3,153 in Rich & Famous Biographies
• #4,701 in Finance (Books)

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Ayano morio.

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Warren buffett expects this investment holding to balloon to $200 billion of berkshire's portfolio. hint: it's not apple..

Warren Buffett manages a massive portfolio for Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) . As of this writing, Berkshire's equity holdings total around $400 billion.

By far the largest equity holding in the portfolio is Apple (NASDAQ: AAPL) . The Oracle of Omaha poured tens of billions of dollars into Apple stock between 2016 and 2018, amassing a huge stake in the iPhone maker. That stake is now worth around $173 billion.

But Buffett expects another asset held by Berkshire Hathaway to exceed $200 billion in value when Berkshire reports its second-quarter earnings, expected in early August. That is Berkshire's cash and cash equivalents balance, which Buffett invests almost all of in short-term Treasury bonds.

Building a massive war chest

Buffett hasn't seen a lot to like in the stock market recently. He's sold more equities than he bought for six consecutive quarters as of the first quarter this year. That includes two consecutive quarters of selling Apple shares, among others.

It wouldn't be a surprise if the August earnings report shows additional stock liquidation. And after selling $2.3 billion worth of Bank of America stock (and counting) in July already, he could make it eight quarters in a row.

When you combine those stock sales with Berkshire Hathaway's cash generated from operations, it starts to add up fast. Berkshire's Treasury holdings ballooned from $109 billion at the end of the third quarter in 2022 to $189 billion 18 months later.

Buffett knows the Treasury holdings are probably overkill. "Your company also holds a cash and U.S. Treasury bill position far in excess of what conventional wisdom deems necessary," he wrote in his most recent letter to shareholders. He described the position as "an insurance policy on a fortress-like building thought to be fireproof."

The Treasury bill investment is intended to be a short-term investment, though. Buffett prefers bonds that mature in a few months over those that won't mature for years or decades. He learned that the hard way when he invested Berkshire's cash in 15-year bonds in the 1970s, amid rising inflation, only to regret it later as rising rates decimated the value of his holdings. Now, Buffett insists on safety over yield when it comes to short-term investments.

"We'd love to spend it," he said of the Treasury bills at this year's shareholder meeting. "But we won't spend it unless we think we're doing something that has very little risk and could make us a lot of money."

As Berkshire grows bigger and bigger, those opportunities become fewer and farther between. Deploying tens of billions of dollars into acquiring a stock or an entire company -- especially one that fits Buffett's investment criteria -- isn't easy.

Should investors buy Buffett's biggest holding?

The good news for investors is that they typically handle a portfolio that's worth less than the $600 billion in combined equities and treasuries Buffett's in charge of. That gives them a lot more room to maneuver.

That said, Buffett's growing investment in Treasuries and his inability to find a great investment for Berkshire shareholders suggests it's increasingly difficult to find a good investment opportunity regardless of the size of your portfolio. Nonetheless, the S&P 500 has produced a total return of about 57% since Buffett started selling more in equities than he purchased back in the fourth quarter of 2022.

To be sure, Berkshire has done just fine in that period. Its share price is up 64%, and operations are firing on all cylinders. But the company's Treasury bill holdings are just plugging along, offering yields around 5.3%. In all likelihood, Berkshire Hathaway would be worth even more as a company if Buffett hadn't sold any of its equity holdings over the past six quarters. Still, Buffett had plenty of good reasons to sell.

In that light, it makes sense that Buffett's top recommendation for investors is to buy an S&P 500 index fund. He recommends it even more than his own company's stock. While he believes there's a very good chance Berkshire will outperform the benchmark index over the next 10 years, he wouldn't want to bet his life on it, he told shareholders back in 2020.

That said, Berkshire stock looks like a great investment right now too. And long-term investors are probably best off limiting their exposure to Treasury bills unless they have short-term liquidity needs.

Should you invest $1,000 in Berkshire Hathaway right now?

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Bank of America is an advertising partner of The Ascent, a Motley Fool company. Adam Levy has positions in Apple. The Motley Fool has positions in and recommends Apple, Bank of America, and Berkshire Hathaway. The Motley Fool has a disclosure policy .

Warren Buffett Expects This Investment Holding to Balloon to $200 Billion of Berkshire's Portfolio. Hint: It's Not Apple. was originally published by The Motley Fool

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Does Warren Buffett Really Practice What He Preaches About Diversification?

• Warren Buffett has famously said that diversification is a bad choice for investors.
• Buffett's Berkshire Hathaway lives up to that belief, with a stock portfolio that is heavily concentrated in a small number of companies.
• But Berkshire Hathaway isn't a normal company. 
• Motley Fool Issues Rare “All In” Buy Alert

NYSE: BRK.B

Berkshire hathaway.

Warren Buffett doesn't like diversification when it comes to buying stocks, but it looks like he does when it comes to buying companies.

Warren Buffett is an all-star on Wall Street; every word he speaks is treated as if it has come from on high. There's a good reason for that, given that Buffett's Berkshire Hathaway ( BRK.A -0.86% ) ( BRK.B -0.80% ) has dramatically outperformed the S&P 500 index over the long term. But you need to take even this sage's advice with a grain of salt. That's particularly true when it comes to diversification.

What Buffett has said about diversification

The so-called Oracle of Omaha didn't mince words with his comments on diversification, which is a tried-and-true investment tactic. In short, he came out against the practice, explaining that, "Diversification is protection against ignorance. It makes little sense if you know what you are doing." That's pretty rough and might even hit at the ego of some investors, most of which would like to think they know what they are doing.

Image source: The Motley Fool.

To Buffett's credit, when it comes to Berkshire Hathaway's individual stock portfolio, he lives by his words. At the end of 2023, the company noted that 79% of its investments in equity securities was concentrated in just five companies: American Express , $28.4 billion; Apple , $174.3 billion; Bank of America , $34.8 billion; Coca-Cola , $23.6 billion, and Chevron  $18.8 billion. Each of these investments has been a fairly big success story over the long term, noting that Apple's value was just $119 billion a year earlier. (Note also that Buffett has been trimming his Bank of America position of late, but it still remains a very large holding.)

The logic is pretty simple here. If you pick a small number of good stocks you can quickly compound your wealth. That's just math, since every new stock you add to your portfolio risks diluting the overall return if it isn't a huge winner. And there are only just so many big winners on Wall Street. The problem is that most people probably won't be able to pick just the winners, which is why diversification is so important. It limits the pain from the inevitable investment mistakes that everyone makes (even Warren Buffett).

BRK.A data by YCharts

Don't be fooled; Buffett believes in diversification

For starters, Buffett has said that most investors would be better off buying a broad-based index fund. So his somewhat caustic words about diversification should be taken with a grain of salt. He's most likely speaking about professionals that spend all of their time investing, not small do-it-yourself investors that are trying to balance a job, family life, and investing. But there's one more little fly in the diversification ointment at Berkshire Hathaway.

If you take the time to read Berkshire Hathaway's annual report, you'll find something fairly unique under the section titled Business Description. This is usually the first thing in an annual report, and it normally takes up less than a single page. For some companies it's just a single paragraph. For Berkshire Hathaway the business description runs for more than 20 pages.

The issue isn't that Berkshire Hathaway's primary business is so complex that it needs that much space to be explained. The reason that the business description runs 20 pages is that Berkshire Hathaway's portfolio of owned businesses is huge and, wait for it, shockingly diverse.

The core operation is the company's insurance arm. But its railroad, utility, and energy operations are so large that they actually get broken out in the financial statements. Right there the company is diversified across four large and very different businesses. However, there's a lot more going on beyond that, including businesses in the manufacturing, housing, retail, chemical, and automotive sectors, among others. The list of businesses Buffett has acquired is so extensive that it really does take more than 20 pages to cover.

The key is in the way Buffett invests

You could play this off as different from investing because Berkshire Hathaway owns the businesses and isn't investing in their stocks. That's true, but you have to understand how Buffett operates Berkshire Hathaway, which is effectively just his publicly traded investment vehicle. He is doing the same thing he does with stock holdings, acquiring well-run businesses while they appear attractively priced, only he's buying the entire company. So in effect Berkshire Hathaway is kind of like a giant mutual fund. And the portfolio of owned business is, in many ways, treated no differently than the individual stocks in which Buffett invests.

The big takeaway for investors is to do as Buffett does, not as he says. Yes, if you pick one great stock it could make you rich. But even Buffett uses a diversified approach when it comes to operating Berkshire Hathaway. You should do that with your portfolio, too.

Bank of America is an advertising partner of The Ascent, a Motley Fool company. American Express is an advertising partner of The Ascent, a Motley Fool company. Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Bank of America, Berkshire Hathaway, and Chevron. The Motley Fool has a disclosure policy .

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Warren Buffett: 10 Things Poor People Waste Money On

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Warren Buffett, one of the most successful investors in the world , has a reputation for his simple financial wisdom. His advice is certainly worth listening to, especially if it helps you avoid making money mistakes.

According to Buffett, here are 10 things poor people waste money on and what he does instead .

Low-Value Investments

“The most important investment you can make is in yourself,” Buffett has said, according to Inc. “That’s how knowledge builds up. Like compound interest.”

One of Buffett’s most famous tips, known as the Buffett formula, is to go to bed smarter each day.

According to Inc., Buffett recommends reading. He spends about 80% of his day reading, and he suggests that anyone hoping to achieve success should read 500 pages per day.

If you’re investing in something other than yourself right now, it might be time to rethink your strategy.

Credit Card Debt

Buffett is also very against credit card debt. He prefers to rely on cash instead of using a credit card. “I’ve got an American Express card, which I got in 1964,” Buffett told Yahoo Finance. But I pay cash 98% of the time.”

Quantity Over Quality

“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price,” Buffett wrote in his 1989 letter to Berkshire Hathaway shareholders.

Buffett won’t invest in something just because it’s cheap. Although he’s talking about investing in businesses, this can be applied to everyday life. When you prioritize quantity over quality, the short-term gains may not mean much (and it could cost you more) in the long run.

Unnecessary Spending

Buffett doesn’t care about having the latest technology or designer labels. According to AP Moneywise, he used a $20 flip phone for several years before upgrading to an iPhone in 2020.

His advice? “Do not save what is left after spending, but spend what is left after saving,” according to Moneywise.

Cars are depreciating assets. According to Kelley Blue Book, most new vehicles have a 20% drop in value in the first year.

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So instead of buying a new car, Buffett prefers to buy used vehicles at reduced prices.

“The truth is, I only drive about 3,500 miles a year, so I will buy a new car very infrequently,” he said, according to Forbes. 

Full-Price Purchases

Even Warren Buffett looks for good deals. Years ago, Buffett once treated Bill Gates to a meal at a fast food restaurant and used coupons to help pay for the meal.

“Remember the laugh we had when we traveled together to Hong Kong and decided to get lunch at McDonald’s? You offered to pay, dug into your pocket, and pulled out … coupons!” Gates wrote in his and now-ex-wife Melinda’s 2017 annual letter.

“Melinda just found this photo of me and ‘the big spender.’ It reminded us how much you value a good deal,” Gates wrote, using the anecdote to segue to a discussion about the value of philanthropy.

Regular Nights Out

Buffett has a very simple diet and doesn’t like to go out much. In Buffett’s biography, “The Snowball: Warren Buffett and the Business of Life,” author Alice Schroeder quoted him as saying, “I like eating the same thing over and over and over again. I could eat a ham sandwich every day for fifty days in a row for breakfast,” Mashed reported.

Wasted Opportunities

In his early years, Buffett picked up side hustles and made money by delivering newspapers, selling used golf balls and buffing cars, as previously reported by GOBankingRates. He also looked for new opportunities, and when he couldn’t find any, he’d create them.

At a 2007 Berkshire Hathaway shareholders meeting, Buffett called gambling “socially revolting,” according to The Motley Fool.

“I’m not a prude about it, but to quite an extent, gambling is a tax on ignorance,” he reportedly said, referring to the tax revenue generated by gambling.

“A government shouldn’t make it easy for people to take their Social Security checks and [waste them pulling] a handle.”

If you have extra money, don’t waste it on gambling.

Living Beyond Their Means

When you’re shopping and see something you like, ask yourself whether you really need it or just want it.

During a 2009 meeting at Emory University, Buffett said something to the effect that his goal is “not to make people envious.” He also said you can’t buy health or love and warned the audience not to confuse the cost of living with the standard of living, according to meeting notes from a student who attended, which appeared on the student’s Underground Value blog.

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