Warren Buffett is one of the greatest investors of all time. He bought his first stock when he was just 11 years old, and has since amassed a net worth of $88 billion. He is not only a learning machine but also a prophetic teacher who has doled out wonderful nuggets of wisdom over the last several decades. Here we take a look at the top 20 best Warren Buffett quotes.
The Oracle of Omaha has mastered the art of simplifying complex ideas into quotes that stand the test of time. He continues to share his wisdom through Berkshire Hathaway’s annual shareholder letters and the annual meeting. Buffett is also a generous philanthropist, having pledged to give away 99% of its wealth to charity over time.
Since taking over as the CEO of Berkshire Hathaway more than five decades ago, Buffett has delivered 20.5% annualized returns for his shareholders. These are the best Warren Buffett quotes on money, life, and success:
ValueWalk's Raul Panganiban interviews Dave Murphy, Head of Financial Services, ex-US, at Publicis Sapient, and discuss if banks are doing enough for a digital first future. Q1 2021 hedge fund letters, conferences and more The following is a computer generated transcript and may contain some errors. Interview with Publicis Sapient's Dave Murphy
20- Give your children enough money so that they would feel they could do anything, but not so much that they could do nothing
Giving your children too much money – or “a lifetime supply of food stamps” as Buffett puts it – could be harmful to them. He told Fortune magazine back in 1986 that it’s also “an anti-social act.”
19- You cannot make a good deal with a bad person
Suzy Welch told CNBC that Buffett once said to her, “You cannot make a good deal with a bad person.” Whether you are dealing with bosses, coworkers, employees or investors, it’s always better to deal with people who honor commitments and speak the truth.
18- In the business world, the rear-view mirror is always clearer than the windshield
If you invested $1,000 in Amazon.com 22 years ago, you’d have $1.3 million today. Yeah, but can you tell me how much Amazon would be worth in 2033? No, you can’t predict the future. Neither can I. Yahoo! was worth over a hundred billion dollars just 20 years ago. Amazon experienced numerous drawdowns of more than 50% in the last 22 years and most investors sold their holdings in panic at some point.
17- The chains of habits are too light to be felt until they are too heavy to be broken
Don’t get complacent. Always be open to change and adapt.
16- I always knew I was going to be rich. I don’t think I ever doubted it for a minute
That’s the kind of belief and self-confidence you need to succeed in life and business. All of us need an unwavering belief to move forward in life and achieve our goals.
15- If you are in the luckiest 1% of humanity, you owe it to the rest of the humanity to think about the other 99%
Warren Buffett is a capitalist, but he also believes in giving back to the society and paying it forward. He has pledged to give away 99% of his wealth. It is our moral responsibility to take care of the less fortunate.
14- If you buy things you don’t need, you will soon sell things you need
Learn to live within your means, and save for rainy days. People tend to splurge and raise their lifestyle when they get a salary hike, making impulse purchases. They buy things they don’t need. Don’t waste your hard-earned money on unnecessary things.
13- It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price
This quote goes along the lines of another famous Warren Buffett quote, “Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.” He believes in investing in high-quality businesses with long-term competitive advantage. A stock is not a good investment just because it’s cheap. The quality of the stock is more important. But the billionaire investor also warns against paying too high a price for a wonderful company.
12- You only have to do a very few things right in your life so long as you don’t do too many things wrong
Just a few wins could make you incredibly successful, as long as you don’t fail too much.
11- Honesty is a very expensive gift. Don’t expect it from cheap people
It takes a lot of courage and confidence to be honest in your words and actions, especially when there is the risk of damaging a relationship or hurting your ego.
10- If you aren’t thinking about owning a stock for 10 years, don’t even think about owning it for 10 minutes.
Buffett says his favorite holding period is “forever.” This one goes along the lines of his other quote, “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years.” He believes buying great stocks and holding them for long periods is the best investment strategy.
9- Risk comes from not knowing what you’re doing
The best way to reduce risk in investing is to learn as much as possible about the investment opportunity from trustworthy sources. Educating yourself helps mitigate the risk. Buffett didn’t invest in technology stocks for decades because he didn’t fully understand the technology sector. He may have missed investing early in Google, Apple, and Amazon. But it has worked out well for him because he also avoided investing in stocks like Yahoo!
8- It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction
The people you surround yourself with have a huge impact on your mindset and your actions. Buffett suggests that you should always surround yourself with people who are smarter and better than you. Over time, you’ll see yourself growing, learning, and moving forward. Opposite happens when you hang out with pessimistic and lazy people.
7- Only when the tide goes out do you discover who is swimming naked
This is one of my favorite Warren Buffett quotes. When the times are good or markets are soaring, even dumb losers feel like they are the smartest person alive. But when the times change or markets crash, you get to see the real picture of who has the best long-term investing strategy. Buffett made billions of dollars during the 2008 financial crisis by purchasing shares of quality banks at massive discounts. During the same financial crisis, dozens of people committed suicide and thousands went bankrupt.
6- No matter how great the talent or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant
Accumulating wealth is a long-term process that requires a lot of patience, time, and discipline. Most of us want to get rich quickly, and are always looking for the hot stocks that could 100x their money in three months. It doesn’t work that way. And there is a good chance you’ll end up losing a large chunk of your money.
5- The most important investment you can make is in yourself
Warren Buffett is a voracious reader. He spends at least five hours every day reading books, newspapers, annual reports, and magazines. Both Warren Buffett and his business partner Charlie Munger have attributed reading for their phenomenal success. You should be continuously investing time, money, and resources to learn, improve yourself, and acquire new skills.
4- Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be a more productive than energy devoted to patching leaks
You are going to make mistakes in your investment journey. Not all your investments will turn out to be winners. When you realize that you have made a mistake and invested in a bad business, the worst thing you can do is to keep pouring more money into it. A good way is to admit that you made a mistake, and then put that money to better use.
3- Someone’s sitting in the shade today because someone planted a tree a long time ago
Plan for the future and start laying the groundwork. My investment adviser says it takes two decades of disciplined investing to create wealth. Start investing early and keep investing over the long term to ensure that your future self is debt-free and financially independent.
2- It takes 20 years to build a reputation and 5 minutes to ruin it. If you think about that, you’ll do things differently
You should never compromise your integrity. You work hard for years to build a reputation, and one wrong step could undo years of work. The billionaire investor once famously said, “Lose money for the firm, and I will be understanding. Lose a shred of reputation for the firm, and I will be ruthless.” Your reputation is a priceless asset.
1- The difference between successful people and really successful people is that really successful people say no to almost everything
Learn to say no in a firm but polite manner. We have only a limited amount of time and energy in a given day. If we say yes to everything that comes our way, we will soon find ourselves bogged down in multiple projects. Be selective about how and where you spend your time. It’s all about focus. Both Warren Buffett and Bill Gates have attributed their success to one thing: Focus.
Bonus quote: I measure success by how many people love me
At the end of the day, it’s not the money, mansions, power, and private jets that matter. Buffett says the greatest measure of your success in life is whether the people ” you want to have love you actually do love you.” He once told a group of students at Georgia Tech, “If you get to my age in life and nobody thinks well of you, I don’t care how big your bank account is, your life is a disaster.”
We can expect many more such nuggets of wisdom from the Oracle of Omaha in the coming years. What other Warren Buffett quotes would you like to add to the list? Let us know in the comments below.