Do you want to be smarter with money so your wealth can multiply in the years to come? Well, there is no better person to turn to than the legendary Warren Buffett who has a personal fortune worth more than $72 billion, rightly making him the third richest person on the world. The billionaire was recently kind enough to give some important advice about spending money. Here’s what you need to know:
1. Never Lose Money
Well, this one is a no-brainer. Nobody likes to lose money, so here’s the thing: avoid taking risks whenever you can. If you want to lead a happy and prosperous life, never risk something you need for something you want. Buffett confessed he himself avoided making risky investments over the years, and it helped him get where he is today.
2. Get High Value at a Low Price
You get what you pay for so why pay more money for something that is not worth it? A wise approach is to purchase quality merchandise when it is marked down.
3. Get Into Healthy Financial Habits
While speaking to college students, Buffett explained how behavior is habitual and that once you make a habit of something, it becomes difficult to break it. The worst thing you could do to your money is not make healthy financial habits. If you are not accustomed to savings, you are in deep trouble.
4. Have Lots of Cash Available
Having lots of cash at hand can be risky business. Instead of keeping cash on hand, save it in the bank and use it for making investments. Keeping a decent portion of your money in money market accounts is a good idea.
5. Invest In Yourself
Invest in yourself as much you can. From taking care of your wellbeing to finding the work you love, to education. Decide why you are earning all this money anyway. Any purchases you make to improve your own talent are an investment in the long run. Go back to school if that is what you want, or learn some new skills. What makes you smarter ultimately makes you richer.
6. Set Long-Term Goals
Instead of trying to make a quick buck, think long-term; in fact, think lifetime. Taking risks for short-term goals is the kind of thinking that can get you into trouble. Focus on increasing your purchasing power for the long run.