Every year, tens of thousands of investors flock to Omaha, and even more from around the world to watch Berkshire Hathaway Chairman Warren Buffett answer questions from shareholders at the company’s annual meeting.
Once again this year, Buffett shared insights not only into the financial fundamentals behind many of Berkshire’s subsidiaries and portfolio companies, but also his path to a successful life.
This year’s 4+ hour event is worth seeing, listening to, and reading about. But without getting into the nitty-gritty, here are two important pieces of advice Buffett shared on Saturday. One is about money and the other is about life.
One shareholder asked Mr. Buffett about one of the most basic decisions an investor can make: when to buy or sell an investment.
His description of the process he and longtime partner Charlie Munger employ provides great insight into his investment philosophy.
“Charlie and I made decisions very quickly, but they were effectively the result of years of thinking about the parameters that would allow us to make decisions quickly when decisions needed to be made,” he said. Told.
He said he didn’t invest heavily in Apple until he felt he could fully understand consumer behavior, and after owning several other consumer businesses, some successful and some unsuccessful. He says he has come to that understanding.
After years of gathering information on a particular subject, “something comes along and checks the mass of observations you’ve made and the knowledge you have, and then crystallizes your thinking into action.” “and in some cases take major action,” he said of Apple. ”
Takeaway for investors: Buffett doesn’t buy investments based on mood or impulse. He bought his first iPhone because he thought it was “probably the best product ever.”
On the other hand, don’t worry about missing out on your investment when it comes to products or companies that you haven’t done thorough research on.
“Charlie and I missed a lot of things…We were never worried about missing something that we didn’t understand,” Buffett said.
Shareholders often ask Buffett about his thoughts on living a fulfilling life, and this year’s questioner was so candid that he asked, “What advice would you like to share today that you think everyone needs to hear?” That rarely happens. she asked.
Buffett echoed Munger’s advice: Think about how you want your obituary to be read, and start building your life to get there.
Buffett pointed out that people living in America today have more of a chance to accomplish this than anyone in the history of the world. “You are about to enter the best world that has ever existed, and you want to find people to share it with and activities to participate in that suit you,” he said. Ta. “And if you’re lucky like Charlie and I, you’ll find something you’re interested in while you’re young. But if you don’t find it right away, you keep looking.”
Buffett acknowledged that it may take some trial and error.
“I always tell students, if you didn’t need a job, find a job you’d like to have. Sometimes it comes very quickly, sometimes it takes a lot of experience,” he said. “But don’t forget what you’re actually trying to do.”
No matter what hardships you go through, keep in mind how you want to be remembered in the end. Buffett said that’s the best way to accomplish that.
“Expect some bumps along the way, but if you think that way, you’re more likely to get there.”
Want to make extra money outside of your day job? Apply CNBC’s new online course “How to make passive income online” Learn about common passive income sources, tips to get started, and real success stories.
plus, Sign up for the CNBC Make It newsletter Get tips and tricks to succeed in work, money, and life.
