5 Warren Buffett Quotes on Investing That Will Change Your Life Forever
There’s nothing like being inspired by the greatest investor of all time.
In the investment world, there are voices that matter. Warren Buffett’s voice is definitely one of them. Starting from practically nothing, Warren Buffett built an empire with his financial investment firm Berkshire Hathaway.
This success has enabled Warren Buffett to become one of the richest men in the world with more than $80 billion in personal wealth as we enter the year 2020.
The most amazing thing about Warren Buffett is that his success has been unbroken for over 50 years now. His long-term value-oriented investment philosophy has allowed investors in his company Berkshire Hathaway to become immensely wealthy as well.
If you had made the decision to buy 1 share of his company on June 1, 1990, your $7,100 at the time would have turned into $340,000 by early 2020:
This represents a return on investment of +4,700%.
I’ll stop here with the figures, but I think you’ve got the gist of it. When it comes to making a winning investment, Warren Buffett knows a lot about it.
In what follows, I propose you to go back over 5 famous quotes from Warren Buffett on investment that will change your life forever.
Q1: “The Most Important Investment You Can Make Is in Yourself”
When I talk about a winning investment, I imagine you immediately thought of money. You thought I was necessarily talking about financial investment.
I assure you, you’re not alone. -I’m not alone. When we talk about investment, most people think first of money.
This is a classic mistake that can be explained by the importance that money has taken on in our world.
Money distorts your perception of the world. It often makes you lose sight of the fact that you are your most valuable asset. So you have to invest a lot in yourself in order to grow.
Becoming a better version of yourself day by day must be your major goal.
Charles Munger who is Warren Buffett’s historical partner frequently says the following about this need to improve day after day:
“Spend each day trying to be a little wiser than you were when you woke up. Day by day, and at the end of the day-if you live long enough-like most people, you will get out of life what you deserve.”
— Charles Munger
The most important investment you can make in your life is therefore on yourself.
It’s not so obvious because many people would rather buy shares for $2,000 than take a training course that could boost their knowledge and make a big difference in the long run.
Life is a marathon, not a sprint.
So you have to see yourself constantly improving, step by step. Over time, with the magic of compound interest, it will make a huge difference to your future.
Investing in yourself is also about reading a lot. Warren Buffett confesses to reading 500 pages every day. That’s a lot, and he has the time to do it.
In your case, reading even 20 pages a day will make a huge difference. So whatever happens, you must never neglect yourself when it comes to investing.
Q2: “Risk Comes From Not Knowing What You Are Doing”
Many people say that Warren Buffett was able to succeed because he is not afraid to take risks. As far as Warren Buffett is concerned, they’re wrong. All the investments he made over his long career were not risks.
Warren Buffett explains that if you know what you’re doing, you don’t take risks.
So the most important thing is to make sure you understand what you’re doing when you make an investment in a company.
If you have a thorough understanding of all the ins and outs of an investment, you can make a decision with your risk under control.
You will be investing an amount of money that you can afford to lose, so no matter what happens next, you will not be in a bad position. You’ll have a free spirit because you’ll know that you’ve made the best decision for you at a given time.
Warren Buffett’s philosophy is to take action only when you really understand what you’re doing.
Q3: “Price Is What You Pay. Value Is What You Get”
Warren Buffett is a disciple of Benjamin Graham and his value-oriented investment philosophy. First published in 1949, Benjamin Graham’s “The Intelligent Investor” is often cited by Warren Buffett as the best investment book of all time.
The value-oriented investment philosophy that Warren Buffett has always followed encourages you to focus on a company’s long-term value rather than its short-term price.
You pay a certain price. The value you get in return will determine whether that price is really expensive or not.
Sharp short-term price swings in a stock are just noise that should never distract you from what’s important: the long-term value of the company you choose to invest in.
Based on this premise, Warren Buffett’s secret to making successful investments is therefore to target companies whose share price is well below the long-term value of the company.
It’s up to you to do your own research to find these types of companies to invest in.
Q4: “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful”
Emotions are the number one enemy of all investors. People who make the mistake of letting their emotions guide their investments usually lose a lot of money.
To emphasize the importance of never letting emotions guide your choices, Warren Buffett advises that you should keep a cool head.
You have to be wary when everyone else is greedy in the market. This is usually when investors lose the most money.
On the other hand, when the masses are fearful, you have to be greedy because the winning investment opportunities are more important.
Q5: “Rule N°1: Never Lose Money. Rule N°2: Never Forget Rule N°1”
I haven’t mentioned money until now. This last essential quote from Warren Buffett with regard to investment will therefore refer to it. If you look on the Web for rules to make winning investments, you’ll find dozens, if not hundreds.
I, for one, really like this one from Warren Buffett that brings out the essence of why you invest.
An investment is all about making money. If you lose money with every investment, you might as well not invest.
So you need to be careful, and make the right decisions in your investments.
Everyone makes mistakes. You will also experience them. At that time, you will have to understand the reasons for your mistakes so that you don’t make them again and limit them to the right amount.
Finally, the only investment that will always be a winner is you.
As explained in detail for the first Warren Buffett quote I put forward in this story, you must continually make the choice to invest in yourself.
We are entering the knowledge age. To be among those who will benefit most from it, you must therefore seek to continually improve your knowledge throughout your life.
This will allow you to be among the one percent who are always ahead of the rest in all areas.
Warren Buffett is a sacred investment monster. His consistent success for over fifty years commands the utmost respect. Personally, I love to study everything he says because there is so much to learn from such a man.
In this story, I’ve brought out the 5 investment quotes that can really change your life forever. If I had to pick just one, it would be the important thing to always believe in yourself, always investing in yourself.
By seeking to become a better version of yourself day after day, you will sooner or later reap phenomenal benefits in your life.