Warren Buffett also known as the “Oracle of Omaha” is considered one of the most successful investors in the world. Currently he is the third wealthiest person in the world with the net worth of $91.6 billion.
Warren Buffett started trading stock in a very young age of just 11 years. He was so deeply involves in business and investments that he started paying the taxes at the age of 13 only.
Warren Buffett is the Chairman and CEO of Berkshire Hathaway which is a conglomerate that owns 60 companies worldwide. He has also started ‘The Giving Pledge’ along with Bill Gates where people mostly Billionaires vow to donate at least half of their fortune to good causes.
Apart from being the most successful money investor in the History, Warren Buffet is constantly credited for his simple and frugal lifestyle.
The main question that arises in our minds whenever we talk about Warren Buffett is how did he acquire it all? Well, he gives all the credit to the money management.
Here, we bring you some money management tips from the legendary investor, Warren Buffett himself. Have a look :
1. Lead A Simple Life :
According to Buffett, spending money allows for savings to be consumed so you’re not really increasing your wealth. In order to increase your wealth, only spend on what you need and cut down on the unnecessary spending, which also explains the reason why Warren lives in a cozy but small house and drives an everyday car. So, If you ever happen to stumble across an amount that may change your lifestyle, do not spend it, instead SAVE IT!!!
2. Avoid Compulsive Buying:
Although Warren Buffett isn’t trying to stop you from spending and buying things you may need. The point he wants to convey is that there is a time to buy everything, try to find the best time to purchase something. If you have a look at the investment portfolio of Warren Buffet, he is known for his timing of the purchase of stock and selling it as well. And the same logic can be applied in day to day spending as well. With that, he is also trying to convey that do not spend on something because everyone else is also doing or just because it is attractive. Spend according to the importance and need.
3. Purchase According To Value :
If we are buying something, we are making an investment on its own as well. Everything that we own is for the benefits and easiness it provides to us. So, next time you decide to spending money on something make sure that you are not just spending it because of Social pressure or designs but because of it’s value. If a product is beneficial enough and is valuable then that’s the right thing to purchase but keeping the price in mind.
4. Learn How To Improve Savings :
Do not save what is left after spending, but spend what is left after saving – Warren Buffet #MotivationalMonday
We often argue that our income amount does not allow us to do savings, but don’t forget, where there’s a will, there’s a way. Cut down on your spending, also cut the luxuries out of your life. Only spend on the things you need instead on the things you want. Always try to find cheaper alternatives to everything. If you want to reach the heights of wealth, then saving is the first step of that ladder!
5. Start Making Investments:
We often read quotes from successful people and billionaires and those who made it big but what do we actually do after that? Do not sit at home and read them, start applying those quotes on your life in every practical way. Warren Buffett states that he started investing in at a mere age of 11 and until then he believes he was wasting his life. So take inspiration from him, learn from him. His stories will groom you, teach you and will help you to save more than you think.
6. Adjust Your Mindset and Attitude:
Looking at the remaining amount after making all the necessary payments is very heartbreaking, it can be difficult to try and save. But that’s exactly where a change is required. Involve yourself in frugal thoughts. Try to save wherever and whenever you can.Take a cut in your initial paycheck and save that instead of saving at the end.
In the words of Warren Buffett: “I’m not requesting that you put $1,000 away a month, I’m requesting that you set away $50, or a little sum that you can bear. We truly can’t think little of the power of starting small, because in light of the fact that more often than not that things work out as we planned and once we see improvement, we tend to repeat practices.”
7. Live A Rich Life But Secretly:
If you succeed in saving a huge amount or start building up wealth, do not start buying the luxurious goods you see in order to try to impress others by purchasing. No fancy cars, no fancy houses or jewelry. Start living below your means, so that your savings are always higher than spending and eventually leading you to have higher numbers. Be rich but secretly!
Keep scrolling down to read more articles on FunniestIndian.com.