Born on Aug 30, 1930, Edward Warren Buffett is a philanthropist, investor and business magnate. He is popularly considered one of the most successful investors in the 20th Century. He is the biggest Shareholders of Berkshire Hathaway, and he is a prominent feature in Forbes top 100 richest people in the planet. Warren topped the list in 2008, and he ranked 3rd in 2011. The Times magazine named Buffett as one of the most influential people across the globe in 2012. With an estimated net worth of $62 billion, Warren buffet is one of the wealthiest men across the globe.
When he commenced purchasing stocks in Berkshire Hathaway, a share was trading at $7.5. But today, he is the chairman and CEO of Berkshire, and he holds shares worth $119,000. Warren accredits his success in business to several vital strategies. Of course, if you want to get rich and make the most out of you funds, it does make a lot of sense to listen and know a thing or 2 about investing from seasoned investors. Here are top 10 Warren Buffett Investment tips everyone Must follow. Check them out
10. Spend Wisely
Buffett says, “If you purchase things you don’t need, you will soon be forced to sell things you need.” Most of us give up to the urge to splurge, and we justify our bad routines to the pretext of peer pressure, special occasions, family, emotions, lifestyle, and smart decisions. Buffett says, “Most marketers understand this tendency, and they strive to make the maximum out of it. They make offers that exploit you, and give you a fake notion that you have made the right decision. For instance, unhealthy carbonated energy drinks are sold with the promise that they will give youthfulness, adventure, and happiness.” Warren says, “Always ask, do I need this thing? Can I save funds without compromising on the quality of the service or product I want? Is my expenditure being pushed beyond the ceiling?” That is the only way you will save money.
9. Save For The Unexpected
Warren says, “You are standing under a shade today because someone planted the tree sometimes back.” We all know that savings are vital for any chance of a better future. But it is alarming to note that most of us don’t save even for emergencies. This occurs due to our myopic view on personal finance. Buffett says, “To most individuals, instant gratification counts the most than saving for the future. In fact, some people perceive saving as a sacrifice.” Warren advises that you should make it your habit to save for your future spending as soon as you can. “Take professional advice and know how much you should invest and where to achieve your goal in time.” He advises.
8. Think Long-Term And Be Patient
“Regardless of how talented and hardworking you are, some things take time. You cannot produce a baby in one day by making nine women pregnant,” Buffett says. Wealth is a part of nature; it does not grow within seconds or overnight. However, most people overestimate the wealth they can make in 1 year and underestimate the amount they can raise in 10 years. Buffet says, “The best way out is to hold a well diversified portfolio based on your companies risks and financial goals. Select the right financial instruments regularly and persistently.”
7. Limit Your Debts
“I have seen a lot of people fail because of leverage and liquor. You do not need debts in this world much. If you are wise, you will make huge amounts without debts.” Buffett warns. Clearly you cannot become wealth by living on debt finance. “Most people get into the trap of debt thinking that debts are manageable, but US is rich with example of what happens when debts become overwhelming.” Buffet says. Borrowing should never be made with clear and accurate projection of future cash flow and other financial goals.
Buffett says, “The real risk arises from not doing anything.” Everyone wants to raise money, and we all want to do it as quickly as possible. We choose investment that promise large returns, but we fail objectively to analyze the attached higher rate of risk. Striving to hit 6 on every ball is nothing but gambling. Buffett says, “Investing without proper information increases risks. However, instead of shying away from investing, you should obtain knowledge to make it right.”