Warren Buffet’s Retirement: 5 Smart Money Moves That Made Him His Massive Fortune
Written by
John Csiszar
Edited by
Zuri Anderson
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Warren Buffet is one of the richest men in the world, with a current net worth of approximately $157 billion, according to Forbes. As the CEO of Berkshire Hathaway for 60 years, Buffett has been the perfect case study for how some relatively straightforward business principles can result in massive success.
While Buffett certainly has some advantages that most average investors don’t — from incredible stock-picking acumen to nearly unlimited capital reserves — the principles that he follows are basic enough for anyone to follow and understand.
With news of Buffett’s retirement buzzing, here’s a look at five smart money moves from the Oracle of Omaha that you can adapt to use at a personal level.
Buying Strong Businesses at a Discount
Berkshire Hathaway is a conglomerate of hundreds of businesses. Essentially, it acts as a holding company for Buffett’s investment choices. To make it into Berkshire’s portfolio, a company has to be a quality business trading at a discount.
In most cases, this means it’s priced below what Buffett determines to be its “intrinsic value.” This provides the opportunity for future profits when the market “correctly” reprices the business.
It’s true that the average investor likely doesn’t have the time or talent to analyze a company’s cash flows and future earnings to derive an “intrinsic value.” But the principle behind the process remains applicable to all investors and can be distilled down to this simple strategy: Buy low, sell high.
Having a Long-Term View
Buffett has been famously quoted as saying that his favorite holding period for a stock is “forever.” Buffett is the anti-trader, a long-term investor who gives his stocks years if not decades to turn huge profits.
This gives Buffett the time to enjoy the benefits of compound interest and also to take advantage of long-term capital gains tax rates. These are both fundamental investment concepts that anyone can adopt.
Keeping Cash Reserves
One of Buffett’s driving investment principles is that you should always keep cash reserves on hand so that you can take advantage of any market opportunities. Now, it’s unlikely that you’ll ever amass the whopping $334 billion in cash reserves that Berkshire Hathaway currently holds, but the idea behind amassing cash reserves applies to everyone.
While you shouldn’t hold too much cash in your portfolio, having some on hand allows you to be flexible and adapt to the current market environment.
Understanding What You Buy
Buffett is far from the only financial expert to recommend understanding what you buy, but he holds to this mantra like an oath. Before he famously bought a massive position in Apple stock, he stubbornly avoided the hot tech stocks that were driving the market higher because he admitted he didn’t really understand them.
Although he may have missed out on some big gains from well-known companies like Nvidia, he’s still managed to assemble a portfolio that has absolutely trounced the returns of the S&P 500 for a decades-long stretch. Clearly, the stocks that Buffett does choose to invest in are ones he thoroughly understands, including their profit potential.
Avoiding Debt
As of March 2025, Berkshire Hathaway held approximately $126 billion in debt. While that may be a lot of debt in an absolute sense, relatively speaking, it’s effectively nothing. Berkshire has cash reserves of almost three times the amount of its debt — giving it net debt of $0 — and it generated over $424 billion in revenue in 2024 alone. Undoubtedly, the debt that Berkshire carries on its books serves an investment purpose, otherwise Buffett, who famously decries debt, would simply pay it off.
The same principle should hold true with most investors. Debt should only be used to serve an investment purpose, such as taking out a mortgage to buy a property. Otherwise, you should use your cash reserves to pay that down, particularly if it’s high-interest consumer debt, such as on a credit card.
The Bottom Line
While you may never reach the lofty net worth of multi-billionaire Warren Buffett, you can very easily use some of his investment principles to make smart money moves in your own life. And who knows? Given enough time and investment acumen, maybe you too could parlay your strategy into a 10-digit net worth — or at least a solid retirement nest egg.
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