Valuable advice from investment legend Warren Buffett

At the age of 95, billionaire Warren Buffett will leave the position of CEO of Berkshire Hathaway this year, after 60 years of direct management. As one of the world’s most successful investors, Buffett’s views on markets, businesses and the economy have long attracted the attention of both Wall Street and individual investors.

Over the past 60 years, he has given valuable advice on investing, choosing a job and treating others. According to CNNbelow are some outstanding advice from billionaire investors.

1. Don’t lose money – “Rule number one in investing is don’t lose money. Rule number two is don’t forget rule number one”

Buffett is famous for his school of value investing – buying shares of businesses he believes are undervalued and letting them increase in value. “If you buy things for a lot less than they are worth, and you buy a lot of them, you basically won’t lose money,” he said in an interview.

This advice also emphasizes the importance of risk diversification. “It’s the foundation of how I manage money for clients,” said Brian Kearn, a personal financial advisor. Invest for growth, but also to preserve capital. Look for reasonably priced investments, but don’t risk too much of your assets in a single channel.

According to Kearns, that also means investing in a variety of asset classes. “Each type has its own level of risk. When combined, they help you hold the investment for the long term because volatility will be lower,” he explains.

2. Focus on the core – “Identify what is important and that you can understand”

At a 1998 event at the University of Florida, Buffett said he does not rely on macroeconomic forecasts when making investment decisions. “We have never bought or not bought a business just because of some macro perception. Because that doesn’t make a difference,” he explained.

Financial planner Adam Grossman advises clients the same. “The future direction of the economy is important, but we cannot know for sure. Therefore, according to Buffett, investors should avoid forecasting, and especially avoid listening to other people’s forecasts,” he said.

3. Don’t make things complicated – “Skip the noise and keep costs to a minimum”

Most people are not investment experts. However, they can still build a diverse, simple and low-cost investment strategy.

“You don’t have to be an expert to achieve acceptable returns. Follow a path that is sure to yield reasonable results. Keep things simple and don’t try to make big bets,” Buffett wrote in his 2013 letter to shareholders.

This is also the advice he gives to the family’s investment fund manager. “The way to do it couldn’t be simpler: 10% of cash buys short-term government bonds and 90% pours into a low-cost S&P 500 index investment fund,” Buffett wrote. He believes the fund’s long-term results will outperform the majority of investors who put their money into high-fee fund managers.

4. Don’t save your joy for old age – “Don’t sleepwalk through your life”

At a 2008 event with master of business administration (MBA) students, Buffett recounted the story of being picked up at the airport by a 30-year-old Harvard Business School student. This person has a CPA accounting certificate and believes that working as a management consultant will make his resume (CV) more perfect.

“I asked: ‘You’re 30 years old and have all these things, but you’re still thinking about spending a few more years doing something you don’t really want just to beautify your CV?’. I also said that this is like saving sex for later in life,” Buffett said.

He advises students not to be too concerned about getting rich quickly. Focus more on working for “a company or individual you really admire”. Years later, in a TV show, he also reiterated this: “Find a job that you still want to do even if you don’t have to work.”

5. Stay away from credit card debt – “Avoid credit cards and forget about them”

In a talk to Nebraska students many years ago, Buffett emphasized: “If you continuously borrow credit cards, you will have to pay 18% or 20% interest. You cannot improve your finances if you continue to borrow at such interest rates.”

His advice is clear: “If you can’t pay for it, don’t buy it.”

6. Choose your life partner carefully – “The most important thing is to find the right life partner”

Buffett repeatedly praised his first wife Susan and second wife Astrid. He often said that one of the keys to a happy life is sharing it with the right people.

“What qualities do you look for in a partner? Humor, looks, personality, intelligence, or just someone with low expectations. If you make that decision right, I guarantee you will achieve good results in life,” he said at an event in 2008.

7. Kindness is the foundation of greatness – “Remember that the janitor is as human as the president”

Buffett often emphasizes that everyone has the right to choose to become better. This issue was reiterated by him in his letter on Thanksgiving this year.

“Greatness doesn’t come from amassing a lot of money, attracting attention, or wielding great political power. When you help someone, in any of a thousand different ways, you help the whole world,” Buffett wrote.

In 2006, the billionaire signed the Giving Pledge, aiming to donate 99% of his assets to charity. To date, he has given away more than 50 billion USD.