Would You Like Tips From Someone Worth 88 Billion Dollars?
Investment tips from Warren Buffett: how you too could earn $88 billion from investment
US business mogul Warren Buffett is said to have amassed an $88 billion fortune through his investments and business enterprises. The 87-year-old is listed as the third richest person in the world. He made his money through careful investment in a number of leading enterprises, most notably through Berkshire Hathaway, a financial and insurance conglomerate which the octogenarian still takes a hands-on role in, acting as CEO and chairman.
Buffett is a remarkable philanthropist, who gives a large proportion of his wealth to good causes and who has pledged away 99% of his wealth for charity. Yet despite his frequent giving, money continues to flow towards the business magnate. What is Warren Buffett's secret - and could his investment tips help you seek your own fortune? In this article, Trading Education looks at some of Buffett's sagest advice for investors and breaks down his accessible strategy for financial growth.
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Buffett's top tip for investors
"When a person with money meets a person with experience, the one with experience ends up with the money and the one with money leaves with experience."
On Buffett's most recent birthday, in August 2017, he was asked what advice he would issue to a new investor. He issued the adage above, a reworking of a famous quote often attributed to H. Jackson Brown Jr. Indeed, it is experience that has helped Buffett become the wealthy man he is today. He has a history of applying his experience to investments, even where his route seems the least popular - and coming out on top.
In 2005, Buffett publicly wagered $500,000 against what seemed an unlikely outcome. He said that a basic low-fee S&P 500 index fund would always outperform any hedge fund in the long term. Hedge funds are extremely popular among the Wall Street elite, who tend to follow the high-risk, high-payoff model: yet Buffett plays the long game. Ten years on, his speculation proved correct. Where the hedge funds made theoretical gains of $220,000, Buffett's single pick - a Vanguard S&P - achieved almost $800,000 in gains.
Form healthy money habits
"They say that the chains of habit are too light to be felt until they are too heavy to be broken," said Buffett in 2007. Bad habits can be expensive, with investors making the same mistakes time and again. He advises that cash reserves should always be maintained, and that money should never be chased. If an investor is making a loss, they should sell up and try again, rather than going after bad money with more money.
You should always look to the long term when investing, advises Buffett, instead of going for unsustainable get-rich-quick methods. "Someone's sitting in the shade today because someone planted a tree a long time ago," he once told an investment conference. When asked how investors should secure gains on their speculations, he advised that "their focus should remain fixed on attaining significant gains in purchasing power over their investing lifetime."
Trading Education's blogs about money are designed to offer impartial, accessible advice to potential investors and those interested in financial matters. We do not hold responsibility for investments made as a result of the advice in these blogs: the tips listed here are provided for information only, and any investment is made at the investor's own risk. Please seek legal advice before committing to any major investment, and protect yourself and your money
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