These 3 Pieces of Financial Advice From Amazon Founder Jeff Bezos Have Stood the Test of Time
Written by
Kristopher Kane
Edited by
Amber Barkley
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Jeff Bezos is one of the richest people on the planet, so his insights on wealth creation and management come from a truly unique vantage point. Bezos keeps a low profile compared to some other billionaires, but he has dispensed financial advice from time to time over the years.
His range of strategies and observations are the kind of advice that anyone — from people just beginning their financial journeys to top-tier entrepreneurs and CEOs — can learn from. Here are three of his best pieces of advice that you can apply to your financial planning.
Think Long Term
Bezos is a believer in the “buy and hold” school of thought. Rather than focusing on elusive short-term goals, he focuses instead on more distant horizons. He’s held several investments for 10 years or more.
In the billionaire’s view, a long-term perspective is necessary for success. Success isn’t realized through immediate gains and risky investments but through assets and objectives achieved over time.
Focus On Cash Flow
Bezos emphasizes the importance of keeping your eye on the bottom line. In a 2004 letter to Amazon shareholders, he wrote, “Our ultimate financial measure … is free cash flow per share.”
While he was referring to Amazon’s business model, this translates to personal finances: The value of your investments or savings is linked to — if not dictated by — the state of your current and forecasted cash flow.
An increase in income translates into a greater ability to take advantage of lucrative investment opportunities or bolster existing savings. Improving your future cash flow increases your ability to save or invest more effectively, which positions you in the long term to realize optimal returns on investments.
View Investments as Planting Seeds
“Experiment patiently, accept failures, plant seeds, protect saplings and double down,” Bezos wrote in 2017.
Again, this was in terms of Amazon’s business, but individuals can learn from it, as well. No matter the nature of an investment, it’s best to consider an initial entry into a position as planting a seed that will only bear fruit over time. Carefully chosen and monitored investments will produce tangible and reliable returns over the long term.
Just as with careful gardening, the due diligence required to thoroughly vet and understand an investment is what increases its potential for significant growth. The essential element in this process is patience. Success, like nature, can’t be rushed.
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