There are a whole lot of things that can be learnt from one of the richest men in the world, Warren Buffett, who is also a force to reckon with in the investment world.
The business mogul has some personal finance tips which he follows that can also adapt to your daily life.
Here are five personal finance tips you can learn from Warren Buffet.
1. “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years”
It does not matter what you are buying, anything you buy must still be useful after a very long time.
Which means you should not buy something that would not have value in the future. So before buying anything, even if it is investing in stocks, make sure what you are about to buy would still have value in the future.
Before buying anything look out for the long-term benefits of such thing.
2. “Someone’s sitting in the shade today because someone planted a tree a long time ago”
This is telling us to start investing and saving early and spending wisely. Investing, saving early and spending money wisely would help you grow your finances.
This would make it easy for you to gain financial independence and having no worries about financial problems.
So you need to start making good financial decisions to achieve your long-term financial goals.
3. “Price is what you pay; value is what you get”
Before buying anything have it in mind that there is a difference between price and value. Just because you buy or invest in something expensive or cheap does not mean it would have value.
Buy or invest in things that you feel and believe you would get value for your money, whether it is expensive or not.
But try to get something with high value at a lower price.
4. “You really don’t need leverage in this world much. If you’re smart, you’re going to make a lot of money without borrowing.”
To gain financial freedom and independence, you should avoid accumulating debt and one way you can keep doing this is by borrowing.
I’ve seen more people fail because of liquor and leverage — leverage being borrowed money,” Warren Buffett in a speech given at the University of Notre Dame.
So you need to avoid borrowing and having unpaid debt.
5. “Invest in as much of yourself as you can. You are your own biggest asset by far.”
You are your own asset. You need to invest in yourself by improving and expanding your financial knowledge. Read books that will teach you more about financial and money management.
You can also invest in yourself by improving your skills and making your self more valuable
