FOX Business Network's Liz Claman will interview Berkshire Hathaway CEO Warren Buffett in an exclusive sit-down on Monday May 6th at 9:30 a.m. following the Berkshire Hathaway shareholder meeting. Claman has interviewed Buffett numerous times throughout her career, so below she shares some insight on what advice he might give to those making 50K per year.
1) No matter how small an amount you can allot, put a bit, every month, into the stock market, most likely through no-load (no fee) index funds. Buffett doesn't have a minute for investment advisors who charge you a fee to make dumb mistakes in the stock market. He is constantly making bets with people that a basic S&P index fund will eventually, over time, outperform the fancy, pricey brokers. If you don't have a lot of money to spare, it's the best idea out there.
2) Follow your passion. Do what you love and the money will come. He loves to say, "I tap dance to work." That's how much he loves his profession. And by the way, Buffett doesn't love money. He loves the process of *making* the money. He went directly into the profession for which he had an affinity. Whether it's comic book artist, newscaster or social work, if you head straight to where your desire lies, you'll be successful.
3) Invest in yourself. Back in the day when he wasn't making a lot of money, he spent more than $100 dollars on enrollment in the Dale Carnegie "How to Make Friends and Influence People" seminar. He was terribly shy and realized he'd never make it to the top no matter how talented he was in asset allocation if he couldn't communicate with people well. He loves to say that that course, along with the engagement ring he bought his wife, is the best investments he ever made.
4) No need to be cheap, but be frugal. Once I called Buffett on Valentine’s Day and guess what he was eating? A roast beef sandwich. He wasn’t having filet mignon. Certain situations and endeavors may call for splurging and being more carefree, but if the billionaires are saving money, maybe you should too.
5) Be disciplined. You probably know that Buffett bought Heinz recently. But did you know that Buffett has had his eye on it since the 1980s? It was only recently that it got to the price he wanted to pay for it. Buffett absolutely refuses to overpay for stocks. He reports his own earnings for Berkshire, going by book value (which considers assets and liabilities). He tends to assess a company’s value similarly and once he determines the price he’s willing to pay for it, he won’t budge an inch. Design a set of rules that work for you when it comes to budgeting and spending and adhere to them closely if you want to be successful.