Investing

12 Warren Buffett Quotes Every 30-Year-Old Needs To Hear

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In our teens and twenties, most of us want to do things our own way. But by the time we reach our 30s, the realities of life are hitting hard: childcare, car repairs, endless student loan payments, and the seemingly impossible task of saving up a downpayment for a house. Suddenly advice from someone who’s been there, done that becomes a priceless commodity. And who better to turn to for advice than a man who became a millionaire at 32 . . . and a billionaire at 56?! That man would be Warren Buffett, currently the world’s 9th-richest individual with an eye-popping $139 billion net worth.

Advice for Life

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From humble beginnings in Nebraska, Buffett built Berkshire Hathaway into a multinational conglomerate holding company, which is still based in Omaha. Buffett’s practical investment strategy looks to buy into solid but undervalued companies with the potential to pay off in the long term, not the trendy flavor-of-the-week stocks that draw impetuous investors. This makes him an ideal investment model for 30-somethings who have decades ahead of them to accumulate wealth. But more than investment advice, Buffett is a fountainhead of homespun wisdom applicable to every area of life. In this article, we’ve chosen a selection of his quotes that can provide food for thought to younger Millennials and older GenZers who are figuring out a plan for their 30s and beyond.

1. “It is a terrible mistake for investors with long-term horizons — among them pension funds, college endowments, and savings-minded individuals — to measure their investment ‘risk’ by their portfolio’s ratio of bonds to stocks.”

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Why is it relevant?

  • 30-year-olds still have decades ahead to weather the market’s ups and downs, so they can afford to be less risk-averse in investing.
  • Specific investment areas with a long-term horizon for them include retirement and college savings for their children.
  • Stocks or bonds can be more or less risky depending on the timeline of the investment and market conditions.

It’s Less Risky to Take Risks

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In investing, cautious people sometimes shy away from the stock market out of fear of the risk involved. This can be a wise strategy for someone who will need their money within a few years, such as for a downpayment on a house or for their imminent retirement. But for a person with 4o years to go until retirement, a low-risk strategy can cost them hundreds of thousands of dollars or more in lost capital accumulation in a market that has historically grown and outpaced losses over long timeframes. Suddenly, that cautious approach becomes one of the riskiest things you can do.

Buffett’s advice can also be applied to other areas of life, though. Starting your own business, moving overseas, committing to a relationship, or breaking out of the expectations placed on you by others can feel dangerously risky. Not doing so, however, is more likely to give you the same mediocre gains in your life’s priorities as overly cautious investing can do for your retirement plan. 

2. “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”

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Why is it relevant?

  • Younger people sometimes face the temptation to take ethical shortcuts to jumpstart their careers and financial goals.
  • 30-somethings might still have some less-mature friends who urge them into impetuous and self-destructive behavior.
  • Many people are getting married and having children at this age. It’s time to forego immediate gratification to create a stable nest for the family.

Building and Keeping a Reputation

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The human brain is wired for the survival of the species. The brain is still developing up to about age 25. When we’re younger, our brains function in such a way that we’re more likely to take risks, which is exactly what we need whether we’re hunting a woolly mammoth, trying to win a mate . . . or starting our own business. As we age, the brain wiring becomes biased toward more cautious risk assessments, which are entirely appropriate when we have helpless young to protect.

In our 30s we’re still building a reputation that will be foundational not only for family stability, but to build trust that will support us in our career and financial ventures. This is the time we need to develop healthy habits and demolish destructive ones and  surround ourselves with people of honor and integrity to hold us accountable and challenge us to become the best versions of ourselves. And if we do make a mistake, we can own it, make necessary amends, and use it as a learning opportunity.

3. “Successful investing takes time, discipline, and patience. No matter how great the talent or effort, some things just take time: You can’t produce a baby in one month by getting nine women pregnant.”

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Why is it relevant?

  • Early in our careers and investment plans, progress can seem slow. It can be difficult to stay the course in a plan that does not pay off quickly.
  • A talented, educated young professional might be disillusioned that no matter what their level of effort, results in business and life still take time.
  • Young people can be tempted to dilute their efforts into multiple ventures to see which is successful; perhaps what is required is to focus on just one.

Enjoy the Journey

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Patience is not an easy skill to cultivate, but mindfulness can help. Impatience is really a form of anxiety. We are dissatisfied with our current situation, and perhaps deep inside, we’re uncertain that our plans will be able to change it. However, it’s been said that life is what happens when we’re waiting for things to happen. Whether in the area of finance, relationships, or achieving other life goals, we often look back to the years of struggle as some of the best years of our life and can find that arriving at the goal can even be something of a letdown. Our lives overall can feel more satisfying to the extent we learn to enjoy the journey.

4.”The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd.”

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Why is it relevant?

  • Young people may form an identity based in conformity to or rebellion against a group. Neither of these serves us well in investing or other life choices.
  • Young investors need to make choices based on their expertise and wise advice, not as a reaction to a mindless mob.
  • A core concept is not to make important decisions on a primarily emotional basis.

The Courage To Go Alone

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Buffett credits much of his success to not following the crowd when they react emotionally to market fluctuations—either diving in with both feet or jumping out in terror. By the same token, sometimes a popular stock actually is a good buy, and that is exactly why it is popular. However, the old adage “buy low, sell high” holds true. It takes nerves of steel to make a counter-intuitive move that everyone thinks you’re crazy for. And that is why some people succeed in the market and some don’t.

5. “Chains of habit are too light to be felt until they are too heavy to be broken.”

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Why is it relevant?

  • Breaking bad habits is always difficult, but easier when we’ve had them 30 years than when we’ve had them 70 years.
  • Some apparently harmless habits can morph into attitudes that, over time, disrupt many other areas of life.
  • The same principle can be used to our advantage, as good habits developed in our 30s may become unconscious good behaviors that can serve us for a lifetime.

Developing Good Habits

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James Clear’s Atomic Habits provides excellent advice corresponding to Buffett’s warning about the power of habits. Creating a good exercise habit can be as simple as doing one pushup a day. Even though such a small habit by itself won’t make a measurable effect on health, it establishes the habit of working out, which you can expand upon. Similarly, breaking a bad habit can include substituting a gradually growing good one. And an unbreakable chain of good habits adds up to the life of a winner.

6. “You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.”

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Why is it relevant?

  • Smart, competent, educated people who have started experiencing some success might expect their success to carry over into other fields.
  • Attention spans have gotten shorter over the years, so it can be hard to stay focused on a narrow range of interests and grow deep expertise in them.
  • Diversification in investing might be overrated if it distracts one from making the profits they could by staying concentrated in one market sector.

Staying in Your Lane

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It’s part of being a well-rounded, well-educated person to know some things about many different fields. That sort of broad general knowledge can mislead us into thinking we know better than others who truly are experts in their field. Moreover, culturally, we are living at a time of both profound skepticism and gullibility. We’re becoming conditioned to mistrust authority, even from those who are skilled professionals in their field, and yet to trust the relatively uneducated opinions of friends, celebrities, or our own spotty internet research. When it comes to our investment plan, Buffett believes we do best when we stick to industries we’re quite familiar with and grow our knowledge deeper in those areas. No doubt we’ll also get along better with others and have more credibility when we don’t try to voice opinions in areas we don’t know very much about.

7. “It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours, and you’ll drift in that direction.”

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Why is it relevant?

  • In our 30s, we can start to feel like we are no longer young and fun. This can influence who we choose to spend time with, for good or ill.
  • Admitting we need help and can learn from others requires humility, which comes easier for some than others.
  • Benefiting from positive influences requires staking out time to spend with them consistently.

Choosing Your Mentors

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In a martial art like jiujitsu, grappling only with beginning white belts can be quite gratifying. You’ll get tons of submissions and feel like the baddest martial artist in the gym. But you won’t get better. You’ll keep on making the same mistakes in technique with no one to show you how easily you could be swept and submitted by someone who knew what they were doing. You get better at jiujitsu but rolling with higher belts. Sure, you’ll be the one getting submitted, again and again. But you’ll learn, and eventually swap your own white belt for a blue one, and beyond. In life, you’ll only improve in the areas that are important to you when you have someone who is knowledgeable, skilled, and forthright enough to show you what you’re doing wrong and teach you better ways to do it.

8.”For 240 years, it’s been a terrible mistake to bet against America, and now is no time to start.”

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Why is it relevant?

  • Younger generations may feel pessimistic about the country’s future. This can cause them to underestimate some of the opportunities they have.
  • With more life experience through multiple crises, we can develop a more zen attitude about the calamity-of-the-week.
  • Underestimating the United States can cause us to make some unnecessarily risky investments in international markets and currencies.

A Safe Bet

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Polls of Millennials and Gen-Zers generally show them to be more pessimistic about the future and about the fate of the United States than older generations. Could they be right? Sure. But if the country collapses one day, this would be outside the experience of all previous generations. We’ve been through a revolution and civil war, national expansion, depressions and recessions, two World Wars, and a Cold War that very nearly ended the world. In comparison, the aggravation, economic malaise, and flagging confidence in 21st-century America looks like a case of the blahs. If history is any indication, the country will continue to experience these ups and downs, life will go on for most people pretty much the same regardless of who is in Washington, and the stock market will continue going up over time. The people who will miss out on America’s opportunities are those who panic and write it off too quickly.

9. “The only way to get love is to be loveable. It’s very irritating if you have a lot of money. You’d like to think you could write a check: ‘I’ll buy a million dollars’ worth of love.’ But it doesn’t work that way. The more you give love away, the more you get.”

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Why is it relevant?

  • It can be a pitfall of youth to try to impress others with possessions. This may not attract the kind of person we would like to spend our lives with.
  • If we build workaholic habits as young people, we can find that love withers for lack of time and attention.
  • Young parents might consider that more time spent with their children would benefit them more than working more to leave them an inheritance.

How Loveable Are You?

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To apply this Buffett quote, it’s useful to think about who we love, and why. Do you love your grandma because she drove a nice car or because she hugged you and told you how much she loved you? What about your dog? Did your dog have to have a pedigree and know how to run an agility course and bark the answers to math problems, or basically just sit there and look at you adoringly and act excited when you come home? It’s pretty easy to love people who love us, and show it. So the way to be loved is not only to be loveable, but to be loving. Let other people feel like they are the most important thing in the world to you, and you will become one of the most important things in the world to them.

10. “Beware of geeks bearing formulas.”

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Why is it relevant?

  • Technology-driven approaches to investing can appeal to young people who are educated and computer-savvy but may be inaccurate.
  • Trusting experts can feel reassuring when our experience is limited, but is no substitute for taking charge of one’s own decisions.
  • It’s worth considering whether the people we are trusting are themselves people we would like to model our lives after.

Theory or reality?

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One of the most basic truths in computing is “garbage in, garbage out.” The most sophisticated computer models in the world will yield junk results if they are based on faulty assumptions or fed bad data. Moreover, people are not as impartial and predictable as they like to think they are. Human error and individual bias at any stage of managing data can skew the outcomes and recommendations in a direction that honestly “doesn’t compute” in the real world. The answer? Treat sophisticated data models as important pieces of information but not as the definitive answer. Investing is both an art and a science.

11. “The business schools reward difficult, complex behavior more than simple behavior, but simple behavior is more effective.”

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Why is it relevant?

  • Having learned a lot of theory in college, people in their 30s might now find that some of what they learned is impractical in the real world. 
  • Being open-minded to learning from people with practical life experience is an important part of our continuing education.
  • Relationship issues that also seem highly complex might benefit from focusing on some simple fundamentals.

The gift of simplicity

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Albert Einstein once commented that you don’t truly understand a subject yourself until you can explain it in simple terms your grandmother would understand. And such a simple, straightforward way of understanding and explaining any number of things in your own life is necessary for a couple of reasons. 1. It helps you stay clear on what you are pursuing, why, and how. 2. It helps you win support from it, whether from investors or family and friends. Ultimately, a clear, simple understanding will lead to a clear, simple plan you can stick to through the years it may take to come to fruition.

12. “There are 309 million people out there that are trying to improve their lot in life. And we’ve got a system that allows them to do it.”

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Why is it relevant?

  • Some people blame others for their own lack of success. It’s important to remember our system is not one of win-loss but can be win-win.
  • With so many individuals finding routes of self-improvement, 30-somethings have plenty of examples to learn from.
  • The desire for self-improvement creates a point of commonality that can connect people in their 30s with others of all ages and skills.

Making Your Opportunities

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A capitalistic system, in theory, creates the conditions that will enable anyone to work their way up from the bottom. Of course, in practice, opportunity is not equal. Some people inherit money, are born into a social class and family situation that opens doors for them or have strings of good fortune that other people don’t experience. At the same time, many of the greatest success stories are from people who overcame adversity. In fact, difficult circumstances can be the crucible that forges the resilience and determination that are key to success. Thus, regardless of circumstances, we can look at our resources and figure out how to maximize them to create our own opportunities.

 

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