Ep 53: Lessons We Can Learn From Warren Buffett

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What can we learn from billionaire Warren Buffet when it comes to our finances? He shares some key lessons and advice to keep our money on track for long-term financial success.

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Show Notes

On today’s show, we’re sharing lessons from billionaire Warren Buffet about how to be smart with your money and have long-term financial success.

Make sure your portfolio is built to survive

Berkshire is known for holding a large amount of cash on its balance sheet and some have criticized Buffett for not being more aggressive in making investments with that cash.

But he highlighted the importance of holding enough cash to ensure that the company can always survive, especially during market panics similar to the financial crisis of 2007-2009.

You can take the same approach to your own portfolio. Avoid taking positions that could cause you to realize a permanent loss or using techniques that might harm you in a crisis, such as margin trading. Having an emergency fund of cash saved can help you survive the inevitable crises in your own life.

Focus on value, not on timing the market

Buffett reminded shareholders that he never knows what the stock market is going to do in the short term, which is why attempting to “time the market” is a poor investment strategy.

Investors who think they can jump in and out of the market at all the right times are extremely unlikely to be successful.

When you’re investing yourself, make sure that you’re focused on the value you’re getting from the investment, or how much you’re paying relative to what the asset will produce, and not whether you think the price will go up or down immediately.

Listen to the full podcast or use the timestamps below to jump to a specific section. 

[2:26] Bankrate article

[5:21 ] Portfolio survival

[10:20 ] Value, not timing

[13:45] Productive assets

[17:06] Avoid speculation

[21:41] Inflation

 

Resources: 

https://www.bankrate.com/investing/warren-buffett-top-tips-and-lessons-berkshire-hathaway-annual-meeting-2022/#:~:text=Here%20are%20the%20key%20lessons%20for%20investors%20from,Make%20sure%20your%20portfolio%20is%20built%20to%20survive

 

Thanks for checking out this episode. We’ll talk to you again soon.

 

“Warren Buffet is very diversified. He is an investor, just like us.”

-Scott Sierens