People have written books about the investment strategies of Warren Buffett, how he values companies, how has been opportunistic buying companies in distress, how he is so smart. So on and so forth. But none of those books are talking about the real reason of why Warren Buffett’s is so wealthy.
Warren Buffet has a net worth of $139 billion, making him the ninth-richest person in the world.
he’s 93 years old right now.
99% of his net worth was acquired after the age of 50
Warren Buffett’s real secret for being so wealthy is his longevity.
He has been investing since the age of 11 to the age of 93. That’s 84 years.
If Buffett had retired at age 65, like most people do we would never have heard of him.
He started investing when he was 11 years old, so that means that he has been an investor for 84 years.
If he would have started investing at age 25, like most people do, would have never hard of him. He would probably be the millionaire next door, but not the gazillionaire he is today.
Time in the market is the overwhelming secret to his success.
The lesson that we can draw from Warren Buffett is that the longer we leave our money invested, the more we will earn.
As of today, April 8, 2024, the one year return on the S&P 500 (an investment available to all of us) is 27.86%. The 10 year return is at 180.6%.
In investing, You Don’t Have To Be Particularly Smart, You Just Have To Be Patient.
All of us could be very wealthy if we let our money grow. If we assume a rate of return of 8%, we can double our money every 9 years or so.
My tip for you is to let your money grow until the grow of money is bigger than your expenses, and then you can start withdrawing some of that money and live a rich and comfortable life.
A good rule of thumb is to have 25 times your living expenses. That means that if your living expenses are $1,000 then you should have accumulated $25,000 and you can continue liven your life style for the rest of your life without working.
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