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Never lose money, Never forget rule no 1.
Do you know who said this famous statement? Yes, you guessed it right Warren Buffet. Known for his austerity and sharp investing skills, his story is nothing less than inspiring. His life is a living legend that teaches us that rejection is not synonymous with failure. The idea is to keep going even when no one trusts you.
Who is Warren Buffett?
Warren Buffett was born on August 30, 1930, and his parent’s name was Howard and Leila Buffett. His birthplace was Omaha, Nebraska. He was the only boy to his parents. His father was a stockbroker and a Congressman. During his initial years, he sold cold drinks and paper to earn the money.
Warren Buffett Education
When he was 14 years old, he invested the earnings in a 40-acre land and then rented it to earn profit. At his father’s request, he applied to Pennsylvania University, and the application was accepted. However, he left the university after two years and graduated from the University of Nebraska. After graduation, his father insisted he pursue a post-graduation degree; he applied to Harvard University, but he got rejected.
Why Warren Buffett was so Famous?
He started his career as an investment salesperson in 1950, but soon he formed Buffett Associates on May 1, 1956. Seven of his family members contributed $105,000, while Buffett’s investment was only $100. He was now running a partnership company, and within two years, he opened two more partnerships, eventually bringing the number to three.
Within one year, warren Buffett opened two more partnership, making the total to 5. In 1957, he purchased a five-bedroom, stucco house on Farnam street for $31,500. Within the third year of partnership, Warren Buffet doubled his partner’s money. In 1960, he asked one of his partners, a doctor, to bring more doctors to increase the investment, and 10 other doctors invested $10,000 in each of his companies.
Initial Career Days
In 1961, his business boomed, and he minted his first $1 million with an investment in a windmill manufacturing company. During these days, he discovered a manufacturing firm Berkshire Hathway; he started to buy the stock in that company. In 1963, he sold the stock of Dempster and continued earning money. The Buffet partnership company became the largest shareholder of Berkshire Hathway company.
What distinguished him from other investors was that he never followed the masses. The incident says it all. In a fraud scandal, when investors were busy selling the shares of American Express, he bought it and then later sold it at double the price that he paid for.
In 1965, his father died, and he purchased the shares of Walt Disney after meeting him personally. He invested $4 million, approximately 5% of its company value in the company.
In 1974,the odds were not in his favour. The stock prices plummeted down and his wealth was reduced by 50%, and in those years, his wife Susie went to pursue a music career, she did not officially divorced him, but he was left devastated. However, he did not lose his calm.
In 1988, he bought shares of Coca Cola company, which turned out to be a lucrative investment. The company stock plummeted from $4800 per share to $8000 per share, and his fortune increased to $3.8 billion.
In 2004, Buffet wife died, leaving behind three children, and he officially married his long time girlfriend at the age of 76.
In 2012, he was diagnosed with prostate cancer and successfully completed his treatment. He then collaborated with Jeff Bezos and Jamie Dimon and ventured into a healthcare business that focuses on employee healthcare.
In 2021, he named his successor Abel, who is currently vice-chairman of one of his non-insurance company. However, he announced that he has no plans to retire anytime soon.
Warren Buffett Philosophy
He believed in investing for a long run and he always propagated the idea of taking calculated risk. He also believed in diversifying the portfolio and not putting all the eggs in the same basket.
If you are not willing to own stock for 10 years, don’t even think of holding it for 10 minutes.
Some amazing facts about the wealthiest man
- He started earning profits when he was six years old. He sold Coca-Cola bottles at Rs 18, thus making a profit of 15%.
- Continuing his entrepreneurial spirit, his friend bought him a pinball machine that they sold for Rs 80,000.
- He bought the first stock when he was 11 years old and continued doing the same by selling the newspapers.
- By the time, he was 16, his earnings stood at a whopping Rs 37 lakh.
- The famous Harvard University rejected his graduation application.
- He earned a fortune after the age of 60 years. As of March 2021, his earnings are at Rs 7.2 lakh crore, thus making him the richest man on the earth.
- He is known as the Oracle of Omaha because of his wise investment choices.
- He had a fear of public speaking, like most of us.
- He donated Rs 2.7 lakhs as a charity.
Today, people pay millions of dollars to have lunch with the richest man on earth. However, similar to us his life was also full of turbulences, but he listened to his heart and never gave up, and now his one of the successful investors that everyone look upto. His life and philosophies are something worth inspiring.
