Warren Buffett Turns 93: His Top Investment Advice and Succession Plan
By Sissi Cao • 08/30/23 5:30am
Warren Buffett, the legendary investor and chairman of Berkshire Hathaway, turned 93 today on August 30th. As one of the most respected business figures of our time, Buffett has not only achieved remarkable success in the financial world but has also inspired generations of investors with his simple, pragmatic philosophies.
The Oracle of Omaha’s Investment Wisdom
Over nearly six decades, Berkshire Hathaway has consistently outperformed popular benchmarks like the Dow Jones and S&P 500, delivering annualized returns of 20 percent or more. Amidst his long reign on Wall Street, Buffett has shared his investment wisdom through his famous quotes in interviews and annual shareholder letters – a must-read for money managers.
Here are Warren Buffett’s top 10 quotes that continue to inspire investment goals:
- “The first rule of an investment is don’t lose (money). And the second rule of an investment is don’t forget the first rule. And that’s all the rules there are.” – 1985 shareholder letter
- “If principles become dated, they’re no longer principles.” – 1988 shareholder letter
- “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” – 1989 shareholder letter
- “It’s only when the tide goes out that you learn who’s been swimming naked.” – 1993 shareholder letter
- “If we can’t find things within our circle of competence, we don’t expand the circle. We’ll wait.” – 1995 shareholder letter
- “What we learn from history is that people don’t learn from history.” – 2004 shareholder letter
- “The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money.” – 2007 shareholder letter
- “Price is what you pay. Value is what you get.” – 2008 shareholder letter
- “A simple rule dictates my buying: Be fearful when others are greedy and greedy when others are fearful.” – 2008 interview with The New York Times
- “It’s never paid to bet against America. We come through things, but it’s not always a smooth ride.” – 2009 interview with NBC
The Future of Berkshire Hathaway
As Warren Buffett celebrates his 93rd birthday, many are curious about the future of his business empire and the succession plan for Berkshire Hathaway. While Buffett himself has not publicly discussed his succession plan in recent years, his longtime business partner Charlie Munger revealed at a shareholder meeting in 2021 that Greg Abel, the head of Berkshire Hathaway’s energy business, would succeed Buffett as CEO if anything were to happen to the billionaire.
Buffett later confirmed this plan in an interview with CNBC, stating that Abel would “take over tomorrow morning” if needed. In the event that Abel cannot assume the role, Ajit Jain, who oversees Berkshire’s insurance business, would step in as CEO. Both Abel, 59, and Jain, 70, were promoted to vice chairmen of Berkshire Hathaway’s board in 2018.
Warren Buffett expressed his confidence in Abel and Jain, describing them as individuals with rare talents and the bloodline of Berkshire. In his 2018 letter to shareholders, Buffett wrote, “Ajit and Greg have rare talents, and Berkshire blood flows through their veins.”
This year in April, Abel accompanied Buffett on a business trip to Japan, where they made significant investments in the country’s top trading houses. Buffett remarked, “Abel does all the work, and I take the bows—it’s exactly what I wanted.”
Editorial and Advice
Warren Buffett’s investment success can be attributed to his disciplined approach and adherence to enduring principles. His quotes serve as valuable guidance not only for seasoned investors but also for those new to the world of finance.
One important lesson from Buffett’s philosophy is the emphasis on long-term value over short-term gains. He advises investors to focus on buying wonderful companies at fair prices, rather than chasing after companies with inflated valuations.
Another key insight from Buffett is the importance of maintaining a margin of safety. Investors should be cautious when others are overly optimistic and take advantage of opportunities when others are fearful. This contrarian mindset can help protect against potential losses and increase the chances of long-term success.
Furthermore, Buffett’s succession plan for Berkshire Hathaway demonstrates the importance of a carefully considered and well-executed plan for business continuity. It highlights the significance of identifying and nurturing talented individuals who can carry on the legacy of a successful organization.
In conclusion, Warren Buffett’s 93rd birthday offers an opportunity to reflect on his invaluable investment advice and the future of Berkshire Hathaway. His quotes remind us of the timeless principles that underpin successful investing, while his succession plan demonstrates the importance of effective leadership transition in sustaining and growing a business empire.
<< photo by Ketut Subiyanto >>
The image is for illustrative purposes only and does not depict the actual situation.
