I made the trip to Omaha recently to glean investing wisdom from two of the greatest investors of all-time — Warren Buffett and his second-in-command, Charlie Munger — but I left with much more. Here are 13 of the most memorable life lessons from Berkshire Hathaway’s 2015 annual meeting.
1. On diets
Buffett said: “I am one-quarter Coca Cola. … if had eaten broccoli and brussel sprouts, I don’t think I would have lived as long.” Buffett added, “I don’t see a lot of smiles on the faces of people at Whole Foods.”
Both Buffett and Munger spent the majority of the meeting chowing down on See’s Candies and drinking Coke — though Buffett did mix in some pineapple juice for his voice. Say what you will about their diet — Buffett is 84, and Munger is 91. Maybe they cracked the code: Do what makes you happy.
2. On predicting the future
Buffett made it clear that Berkshire will “never made an acquisition based on macro factors.” This is because “we know we don’t know.”
Worrying about interest rates and the global economy is stressful, and you have no control over macroeconomic events. Just do as Buffett and Munger do: focus on what you can predict and control.
3. On taking risk
Buffett explained that he and Munger missed some opportunities early on and that they could have “pushed harder.” Munger replied: “It’s obviously true. If we’d used the leverage that some others did, Berkshire would have been much bigger … but we would have been sweating at night. It’s crazy to sweat at night.”
To which Buffett added slyly, “Over financial things.”
4. On finding the right people
When asked about Berkshire Hathaway’s investment managers Todd Combs and Ted Weschler, Munger said: “We want people where … every aspect about their personality makes you want to be around them. … Trust first, ability second.”
Surround yourself with people whom you want to be around and whom you can trust — sound advice.
5. On reputations
When asked how Berkshire Hathaway has built its culture, Munger suggested that it’s about “behaving well as you go through life.” Buffett added, “Over time, you get the reputation you deserve. … I believe the same is true for companies.”
6. On seeing a glass half-full
Munger was asked about insurance premiums for older adults. More precisely, it was a complaint that, even when healthy, elders have to pay more for insurance.
Munger replied: “You find you’re not deteriorating as fast as your contemporaries. You may be paying an unfair price for your auto insurance, but it’s a good tradeoff.”
Given the choice of either staying healthy or paying lower premiums, I’d take the first choice, too.
7. On selecting a spouse
“Look for someone with low expectations,” Munger said.
8. On being liked
The duo was asked by a young boy how they have gotten people to like them. Munger said, “Get very rich and generous.”
Buffett added, “People see all sorts of virtue when you’re writing a check.”
9. On philanthropy
When asked about his pledge to donate 99% of his wealth, Buffett said, “There’s no Forbes 400 in the graveyard.” He added that his equity holdings have “no utility to me, but have enormous utility around the world.”
Later, Buffett said that his goal was to figure out how he could “do the most good.” We may not all have billions of dollars to donate, but I think we can all appreciate the sentiment.
10. On how to succeed
“We’ve now watched a lot of other people get started. The ones who follow [Benjamin] Graham have done pretty well.” Munger continued, “Avoid being a perfect idiot.”
11. On continuing to learn
Munger was asked what matters to him most. He replied, “I think it’s dishonorable to stay stupider than you have to be.”
12. On preparing for opportunity
Buffett was asked why Berkshire Hathaway holds so much cash — never less than $20 billion — and he replied, “You never know when the phone will ring.”
Moral of the story: Make sure you’re ready when the stock market offers you an opportunity you can’t miss.
13. On big-picture thinking
When Buffett was asked whether today’s companies are too short-term-focused, he said, “We don’t ignore yearly earnings, but we don’t live by them.”
Buffett added that he is looking for businesses to be “widening their moat,” or improving their competitive advantage. Essentially, while earnings are important, he wants businesses to be constantly improving, and that doesn’t always immediately translate to bottom-line results.
Insert any personal goal or aspiration, and this applies.