Warren Buffett is well-known for his financial advice. As one of the wealthiest and most financially savvy people in the world, it’s no wonder that many people look up to him for advice and guidance. However, many of his tips and tricks relating to the financial world are already well-known. Here are a few other facts about his life that may provide some additional financial guidance:
He Bought His First Stock When He was 11
Many people don’t even think about buying stocks until they’re well into their prime earning years. However, Buffett bought his first stock in 1942 when he was only 11 years old. He bought three shares of Cities Service Preferred at for a combined $114 ($38 apiece), which amounts to around $1,633 today. Buffett has also stated that he wishes he had started investing in the stock market even earlier than age 11. While most people aren’t thinking of investing that early in life, you can buy stocks or invest in items for your children. Another lesson to take from this is that it’s never too early to think about investing in products that will pay off in the future.
He Didn’t Trust His Instincts
Shortly after Buffett bought those three stocks, their value plunged 29%. Even though the value increased slightly a bit later, he sold the stocks. Unfortunately, a few months later, the value rose to over $200 a share, and selling all three would have amounted to about $600 (or $8,600 today). While there’s no way to know whether something is going to increase or decrease in value, sometimes it’s a good idea to stick with your gut instincts instead of shelling out money or selling the moment things get rough.
He Bought a Farm at Age 14 from a Paper Route Salary
Again, most of us couldn’t even imagine having enough money to buy property while still in high school. But when he was 14 years old, Buffett managed to save the money he earned from delivering papers to buy a 40-acre farm in Nebraska. This is another great lesson about how scrimping and saving early on can lead to worthwhile purchases in the future. If you have a goal in mind, sometimes saving all your pennies until you can afford it is a worthwhile investment.
He Started Selling At Age 6
When Buffett was six years old, he started selling pack of chewing gum for a few cents each. Instead of allowing people to buy individual sticks of gum, he only allowed them to buy the entire pack. Instead of accepting the first sign of profit by allowing people to buy only one stick, he waited until he could make a better profit by selling the entire pack. This is a great piece of advice to keep in mind when dealing with your own finances. Sometimes it’s better to wait and make a more secure investment or financial decision than rushing in an accepting the first deal or offer you find.
He Is Leaving Most of His Fortune to Charity
Even though he’s one of the wealthiest people in the world, Buffett is still leaving most of his fortune to charity rather than hording it away in a bank account or passing it down to his children. He’s stated that he doesn’t think it’s fair for his children or grandchildren should get his fortune just because they share the same blood, and that he’d rather his money help other people in need. A lesson to take from this is that there’s always room to donate to someone less fortunate than you. Sometimes even a small donation goes a long way.
He Was Rejected By Harvard
When he was 19, Buffett applied to Harvard Business School and was rejected despite his extensive knowledge of stocks and financial savvy. However, instead of letting that get him down he persevered and chose to seek his fortunes elsewhere, eventually ending up at Columbia where his financial idol, Benjamin Graham, taught. Rejection is something that even the most successful people undergo and it’s important to remember that while it’s tough to deal with, the best thing to do is strive for an even better option after your first choice fell through.
He Believed He Would Be a Millionaire
When he was a child, Buffett promised himself that he would be a millionaire by the time he turned 35. With a lot of dedication and focus, he not only kept that promise to himself, but went above and beyond by becoming one of the richest men in the world. No matter what your financial goals are – whether it’s paying down debt or saving to buy a house or a car – it’s important to have focus and dedication otherwise you’ll never be able to achieve your financial goals.
He Has Two Rules of Business
Buffett owns a lot of companies, but the only rules he has for his CEOs are to not lose any of the shareholder’s money and to not forget rule number one. Buffett’s made it a primary rule of thumb to never lose someone else’s money when investing in a company or starting a business. This is a great piece of advice to keep in mind when you’re thinking of borrowing money from a friend or family member or if you own your own business. If you’re not using your own money, you should treat it twice as frugally and carefully as you would your own.
His Stock Options Are Long Term
While Buffett is known for his knowledge about investments and the stock markets, he actually only owns stocks in a few companies. However, he owns a decent amount of stock for those companies and he has held onto them for a very long time. There are a lot of people who buy and trade stocks so quickly that they barely hold onto certain stocks for a year or two. Sometimes it’s a good idea to keep hold of your investments or finances and let more money and value accrue rather than cashing it in immediately.
He’s Clever About Investments
It’s well-known that Buffett is smart about his investments, but he’s also actually clever about when he chooses to buy them. Many of the stocks he has were bought at a time when the company was doing very poorly, sometimes on the verge of bankruptcy. He knew the value of many of these products and knew that it was likely that their value would rise again in the future. Sometimes it’s smart to wait for the right moment to purchase because it will lead to more money and less agony in the long run.