00:00:00 Speaker 1: Welcome to Had the Money. I'm Joel and I am Matt, and today we're talking about buffet ISM's lessons from the Goat Investor, and by the way, goat as. 00:00:28 Speaker 2: In the greatest of all Time. We're not talking about how to make money by investing in livestock. It also makes me think that's tomorrow's podcast, The Men Who Starah Goats. Did you ever watch that one? Who? I don't think I. 00:00:41 Speaker 1: Did, But that was Jeff Bridges, George Clooney. 00:00:42 Speaker 2: It was George Clooney. I remember it was an all star cast, like an odd one of those odd movies. It kind of reminded me in my mind. It's very similar to Oh brother, it's just coming like this odd kind of quirky film. Was that Cohen Brothers? 00:00:54 Speaker 1: That was Coen Brothers. Yeah, I do love the Coen Brothers. 00:00:57 Speaker 2: They are a good duo. But we are talking about investing. We're talking about what it is that you should be investing in, maybe how long you should be holding your investments, and generally speaking, just how it is that you should approach investing your money. And so, if this is something that you're looking to brush up on, if this is something that you're wanting to learn more about Well, we think that virtually everything you need to know about investing your money you can learn from the man himself, Warren Buffett. 00:01:21 Speaker 1: Yeah, he's been doing it for a long time, and it's really tough to call someone that got if they've been in like a league for a few years or something like that. But Buffet's ninety two, right, he's he's seen it, done it basically one hundred and I think. 00:01:32 Speaker 2: He's for a century. 00:01:33 Speaker 1: Yeah, we've been doing this and his like prowess has been proved out over the decades. So we're going to kind of run through some Buffet quotes and some Buffet history to kind of talk about to extrapolate to ideas for how we can be better investors and just kind of better with our money totally. 00:01:47 Speaker 2: Yeah, specifically, we've got a lot of Warren Buffett quotes for you all today. But first, dude, really quick, we need to make sure that we think a listener. So this is Joshua Jones and he did us on JJ personally, Jjay. He did. It's a massive favor. So sometime last fall we mentioned how, oh, it'd be so great if we had a spreadsheet of all the different beers that we've had on the show, and obviously we enjoy craft beer on the show, to demonstrate that we can be smart with our money now, investing it for the future while simultaneously enjoying some of it in the present. Yeah right. And Joshua emailed us and he said, hey, guys, I'd be more than happy to kind of work on that when I have some free time, And of course we said that would be amazing, that would be fantastic, And so he worked on it though over Christmas, like over the holiday break, and he sent it over our way and it totally got lost in the email. I remember seeing it and realizing that he had did an incredible workforce. But we never gave him a shout out. We never thanked him here on the show. So A, Joshua, we wanted to publicly thank you, but b we want to share that link with everyone out there who might be interested in knowing virtually all the different beers that we've had on the show over the past five years. 00:03:02 Speaker 1: It's not necessarily ranked or anything star ratings by us, but you can see them all in order by episode, or you can. 00:03:07 Speaker 2: Did include a style type. Yeah, I include the He's like, how about I include the ABV as well as the style of beer in addition to the brewery, what episode it was on. It's a it's a sweet little database. But I'm not sure how many of our listeners are trying to like drink every beer we've ever had. But that is now a lot more possible for you to for you to do by looking at this and seeing what your local bottle shop has. But we'll link to yeah, this, we will this spreadsheet in the show notes on at money dot com. It's a Google sheet. Yeah, so Google sheet, yeah, which is Yeah, it's up there for everyone, and honestly so because it kind of fell off a radar, it means we're actually kind of behind. So I want to do my best to get on there and start updating it as well. But that being said, I want this to kind of be a collaborative thing, and so if you see room for improvement, or maybe you've seen that there is an episode or two that hasn't been updated, feel free to hop in there and update that information. Sure. 00:04:01 Speaker 1: Speaking to yeah, let's mention the beer we're having on todays show for episode six forty one. This is Blender Black Ras and it's by New Park Brewing. And this one comes to us from listener Matthew. Matthew, thanks, he said, some great beers and I'm looking forward to drinking this Berlin or Weiss today on The show Man. 00:04:17 Speaker 2: Absolutely. 00:04:18 Speaker 1: Yeah, But let's get to the topic at hand, buffet ISM's we're talking about lessons from the Goat Investor and and I mentioned earlier, Yeah, you don't call someone the greatest in a sport if they've been playing for a couple of years, right, you might say they've got potential or they could be the next MJ. I mean that's always that's always what happens in with like a new basketball player or something like that. 00:04:37 Speaker 2: Or Michael Jackson. 00:04:39 Speaker 1: Yeah, uh huh no, Michael Jordan. There's Jordan, Baby, It's like he's got the wingspan and the height. Then I don't know Kenny Duncan the same way. We'll see. But like those debates are just never ending about who's the greatest, like Lebron or MJ or should we throw Steph Curry in there? Kobe obviously just like a once in a generation talent. But then you're talking about like, well what about it for including centers, the dominant guys like Maladjawan or whatever. I will stop there because this is not a sports show, but these are the kind of things that like sports talk shows can talk about incessantly. And I used to listen to sports talk until I realized, wait a second, this is so formulaic, and I can't stand to listen to another second. 00:05:12 Speaker 2: I haven't listened to. 00:05:12 Speaker 1: Sports talk radio and forever now. But I mean, you could do the same thing and have just prolonged conversations about who the greatest is in any sphere, like you talk about who's the greatest musician. Is it MJ Michael Jackson or is it Beyonce or is it Bonnie Er. I mean, it just like depends on I thought. 00:05:28 Speaker 2: You're gonna say it Buon Jovie. Some might say I prefer body there. 00:05:32 Speaker 1: Yeah, well, like again, so much of that is in the eye of the beholder. But we all, I think, have this desire to see what sets the greatest people in their given field, apart from the ones who are just really good and the greatest investor conversation, I would say it's not nearly as fraud as maybe some of those other ones. It certainly feels like Warren Buffett is the goat in our eyes, right, he is the greatest of all time, and we're certainly not alone in that assumption. And it's not just because of the returns he's been able to gain and garner over the years. His longevity, his consistency, and his humility, we would say, are admirable. And so yeah, today we're going to talk about the goat. Well, we can learn from him, and we're gonna talk about where he falls short too, because we are Warren Buffett fans, but he's also not perfect. 00:06:16 Speaker 2: Yeah, we're not gonna worship him, but we are devoting an entire episode to what we can learn from a ninety two year old investor, and partly because he's the antithesis of a flashy investor and so investing fads have coming gone right, but Warren Buffett has remained consistently relevant over the decades. Like, I don't think anyone has ever used the word sexy to describe anything that Warren Buffett does, and so much attention has been given to the sexy investments right like the new and improved ways of investing in recent years, we only need to look back to the explosion of cryptocurrencies to meme stocks just a couple of years ago. And the reason for this, the reason those investments got all the attention, is because I think it's human nature to want to try and find shortcuts. Folks want to hit the easy button. And I get it right, a lot of folks had a sense of fomo as speculative investments just shot through the roof. But Warren Buffett, he did not hit the easy button. And we don't want our listeners out there to think that that is the solution as well. And by the way, if you're wondering what Buffet's thoughts were on crypto, here's our first quote of the day. He said that they were basically rat poison squared. 00:07:26 Speaker 1: Wait was that him or Charlie Munger? I think it was him. 00:07:28 Speaker 2: Okay, I thought it was Munger. I thought Munger called it like was some sort of fox Hunt Oka something like that stands up. Neither of them like it. Neither of them and Munger. 00:07:38 Speaker 1: By the way, if you don't know, is Warren Buffett's like a longtime best friend and fellow co conspirator, and when it comes to investing, so the partners their best and partners. 00:07:46 Speaker 2: And and Munger is a little bit older. 00:07:48 Speaker 1: He's ninety nine. 00:07:49 Speaker 2: Exactly, but regardless, wanted to mention that because crypto obviously that's something that most most folks should should probably stay away from. 00:07:54 Speaker 1: Yeah, so, yeah, he avoids the speculative crazies, has been able to kind of a with them consistently over time, and for the most part, that's kind of what you and I suggested too. We didn't want HTM listeners going all in on the latest cryptocurrency or even on the most tried and true cryptocurrencies, which are still relative newcomers. And the reason I say that is because we feel that there's like this behavioral psychological component to investing too, by the way, and it's incredibly difficult to sit on the sidelines while you're seeing folks on social media or even just friends in real life who are making bank while all of your money was invested in the good old, boring index funds. It can be tough to sit on your hands and not do anything and just kind of stay the course. And for this reason, we believe that it can make sense for some folks who desire to invest in speculative assets actually to have some sort of pressure release valve, and we've talked about this over the year. What that means is that we want you investing no more than five percent of your overall portfolio in individual stocks that you're excited about, are even in different cryptocurrencies. So I think you can have a little bit of exposure if you're curious and if you kind of just want to scratch that itch. Warren Buffett, he would probably shake his head if he knew that we suggest that. He would say no, no. 00:09:06 Speaker 2: No, he would be disappointed. 00:09:07 Speaker 1: He would say that all of your money should be invested in tried and true assets that are producing something right. But yeah, we believe it is smart to make some small allowances. If that means if that allows the vast majority of your investments, yes, to be sitting in the tried and true index fund, if that allows you to stay the course kind of with the majority of the money that you're putting into investments exactly. 00:09:29 Speaker 2: Yeah, there's just more to successful investing than just doing the right thing. We've got feelings, we've got emotions that unfortunately can get in the way of the most proven ways of investing our money. But another reason that we're discussing Warren Buffett is because the annual Berkshire Hathaway meeting that just happened just over a week ago, so it felt like a good time to cover some of the wisdom that he doled out in his annual letter and to discuss the man, the myth, and the legend's brilliance here for a little bit, and what it is that we can learn from him. And by the way, I say learn and not emulate for a very specific reason here, right, just because Buffett is the greatest investor of all time, that doesn't mean that we should necessarily try and take his path. Specifically makes me think back when Tim Ferriss he stepped up to the mic at one of the conferences and he asked Warren Buffett about how it is that an amateur investor should invest a million dollars, And this is how Buffett responded. He'd say, I probably have it all in a very low cost index fund. That's about warm buffet voice. By the way, I'd recognize the fact that I'm an amateur investor, forget it and go back to work. And I think that was from back in two thousand and eight. Tim Ferris asked him that question. But we obviously think that the same advice holds true today. Yeah, and that kind of continues to be Buffett's advice for investors who have full time day jobs. Right. 00:10:51 Speaker 1: He doesn't suggest that people try to replicate what he does, but his suggestion makes sense for people who don't have the time to scour market deal and don't have the capital to really like invest in the way that Buffett does. And this is the same reason math that you know Warre Buffett has said that when he dies, the fund for his widow will be ninety percent invested in an S and P five hundred next fund, which is pretty much the path that we want most of our listeners to take as well. Right, he knows that even though he's been able to beat the overall market, there are very few individuals who would be able to do the same thing. And for one, Buffett was incredibly hard working. Right as a thirteen year old, he was earning more than many of his teachers at the time, which says a lot about his industriousness. He was making around one hundred and seventy five dollars a month, which adjusted for inflation, was the equivalent of a forty thousand dollars annual salary today? 00:11:40 Speaker 2: How many insane? 00:11:41 Speaker 1: Yeah, how many thirteen year olds do you know that are that ambitious and hardworking that are making that kind of income? Not many, right, But Buffett he also had a natural gifting as well. He had the uncanny ability to memorize long lists of statistics from baseball cards, and he and his friend would sit down and they would write the numbers from license plates of passing just for fun. There wasn't as much to do back in the pre Nintendo days, right, exactly, No Nintendo switches, none of that stuff. So yeah, he was drawn towards numbers in a way that very few individuals can emulate. So I think there are lessons that we can learn, but trying to emulate and do what he's done is like something different altogether, And that's not what we're suggesting here. 00:12:19 Speaker 2: And in so much of life, circumstances have to do with luck as well. He readily admitted that had he been born in a different country, in a different era that valued different things like physical strength, for instance, that he likely wouldn't have fared nearly as well as he did being born here in the US. When he was born, Warren Buffett. He called this winning the Ovarian lottery, that because he happened to possess a unique set of skills that lent themselves to the creation and the acquisition of businesses over the past century. Here in the US, he's been financially rewarded, and he's been rewarded quite handsomely, I might add, he's something like the fifth richest person in the world, with a net worth of around one hundred and six billion dollars. 00:13:02 Speaker 1: Can youve or take a bill depending on what's going on in the market that day, I guess, right exactly. 00:13:06 Speaker 2: But you're right. 00:13:07 Speaker 1: I think so much of our success hard work plays a massive role. But it's like that the final question right in how I built this? The guy roz asks every business person. He says, you know, do you attribute more to luck or to scale? And I think, like you can't have one without the other. You need both in tandem to achieve greatness or to even do wonderful things. And Warren acknowledges that he realizes that the hard work certainly plays a role, but so does timing too. Makes me think of Bill Gates and how he wouldn't probably have started Microsoft if his high school didn't have access to a supercomputer one of like four high schools in the country or something like that at the time. So it's part of it is luck sometimes And another Warren Buffett quote that fits in here, he said America would have done fine without Berkshire, which is his company, Berkshire Hathaway, but the reverse is not true. And so he just admits that he's greatly benefited from the time and place he was born. 00:14:01 Speaker 2: And if you're. 00:14:02 Speaker 1: Listening to this podcast, there's a really good chance that you've won the Obarian lottery too, right that because of where you live, you have more opportunity than a massive percentage of the people across the globe. But even still, there's just this microscopic chance that you've got the skills necessary to make investments like Warren Buffett. So we probably all need the humility to admit that there's going to be a gap there and none of us are going to be able to achieve kind of what he's been able to achieve the way he's done it. But here's the good news. You don't have to be as smart as him, and you don't have to be as hardworking. You just need to follow some of his advice, some of the principles that he teaches, which is something that virtually anyone can do. And we're going to spend the rest of the episode discussing just that. We'll get to some more buffetisms and what we can learn from them right after this. 00:14:56 Speaker 2: All right, man, we are back from the break talking about how we can invest our money, how we can grow our net worth, maybe not to like one hundred billion dollars status by the time we're ninety two, but you know, maybe a little having a little more of the bick in twenty or thirty years, that'd be nice. And so just before the break, we touched on some of the key differences between Warren Buffett and the other ninety nine point ninety nine percent of all investors out there. But one of the key differences between Buffett and how it is that others invest is his overall approach to investing. He says that he's a business picker, not a stock picker. So what he means by that is he's not looking to see what's happening with the specific stock price of a specific company over the last thirty days or honestly, even over the last couple of years. What he is doing is he's assessing whether or not it makes sense to own a piece of that business based on the fundamentals and how successful that business is likely going to be moving forward. Just giving a number of proprietary factors that I'm sure that he keeps stored away in his mind. But bottom line, like, I just don't see Warren Buffet making like a split second decision to buy something, to buy a stock based on a Cramer recommendation on CNBC. Right, Like Buffett is all about value investing. He followed in the footsteps of his mentor Benjamin Graham. But it is about finding value. It's the ability to. 00:16:16 Speaker 1: Know adeal when you see one. Yeah, essentially, except for a lot of work on the investment front. Right, So it's so much easier to spot seventy percent off on like one of our favorite items of clothing. It's more difficult to assess a company and say, wait a second, everybody else doesn't see the value here. There's a gem in the making. This company has what they like they call like a moat. 00:16:36 Speaker 2: Right. 00:16:36 Speaker 1: If a company has a mote, it means that it's going to be really hard to compete with that company because they have like special ability to make or create something, and so he's looking for advantages. He's looking for value when it comes to the investments that he's making, not just the stuff that he's buying. And I think it just goes to show how hard it can be, though to find those great companies to invest in, which is why Matt, you and I we basically opt to invest in basically all of them. Yeah, it's just too hard to pull off the buying great companies approach when this isn't the field you've dedicated your life to, which just goes back to that Tim Ferriss question and Buffett's answer that we just talked about, and in one of the best Warren Buffett coats ever, by the way, is you never know who's swimming naked until the tide goes out. And so this goes to his thoughts on kind of speculation and kind of how regular amateur investors should be allocating their investment dollars. And it might look like speculators are getting rich for a minute, right, and that us boring investors are missing out on all the fun. We're sitting on the sidelines while folks out there are making just like buukoos of dollars. But that is until market conditions change and folks who are making errant bets with no real plan, they didn't have an investment plan. They were just kind of like flying by the seat of their pants, Yosemite samming it right, like Peo peo peugh, like I'm gonna I'm gonna try this and give this a shot. Well, it can be kind of tough to watch other people making lots of money, but the thing is you when the tide changes and when the market conditions change. 00:18:03 Speaker 2: Course, Well, I. 00:18:05 Speaker 1: Feel like we've all just experienced a crash course on the impact of speculation that it can have on the market and on individual investors. I feel like even some of our listeners have been forthright, Matt. They've reached out to us and they've told us like, hey, I didn't put it all at risk, but I'd lost more than I would have liked to in crypto. And so I think Warren's take on speculation is something we all kind of need to probably continually relearn, but especially in an era like today's. 00:18:29 Speaker 2: Yeah, and honestly, just even aside in addition to speculation, just investing with single companies because you. You might have a terrible quarter or a terrible year, a terrible couple of years, or there's accounting was cooking the books, and all of a sudden you've got a company like Enron that was a legitimate company. It wasn't necessarily speculation. They were producing an actual product, right, Because that's Warren Buffett's criticism of Crypto is that there's no there's nothing actually being created. But even still it can be difficult to know which of these companies to pick. So, like you said, he recommends is that, like, yeah, I'm readily admitting that this is all very difficult to do. Instead, basically, bet on the American economy. 00:19:08 Speaker 1: It's a sure bet Adidas, Right. You never know when those celebrity partnerships are going to low up and then the stock's going to tank. Those are the things you can't predict. 00:19:15 Speaker 2: But let's talk about another way that you should be approaching your investments, and Warren Buffett is all about extending the timeframe of his investments. Here's another quote for you, someone sitting in the shade today because someone planted a tree a long time ago. What he's saying here is that by investing now, by taking the long term approach. You are planting that tree for quote unquote future you. And honestly, I think the reason that some many folks avoid investing is not because they don't have maybe a few dollars, you know that, Like, it's not that they don't have a few disposable dollars that they could opt to sock away into their four to one k or into their roth Ira. Is that they have a hard time just conceptualizing that proverbial seed turning into a big old shade tree. And so the more that we can just connect our current actions to the future possibilities, the future reality of what we're going to turn into and what we are going to need our portfolios to turn into in order to be able to support us, I think the more likely that we're going to be able to make the smarter, but often more difficult moves of prioritizing that future shade over the current discomforts of taking the steps necessary to make sure that that shade happens. 00:20:25 Speaker 1: Yeah, I think you're right, Matt. More people could be investing at least something. It doesn't have to be a ton, right, and we'll get to that too, But it does take starting and it does take regularity to be a great investor, and the war and Buffett approach takes that longer timeline, right. It takes the understanding that trees don't grow overnight, that it's going to take many decades until the little bit sapling you plan it turns into something meaningful, a place that will actually provide any semblance of shade. But it takes that in addition to patients and something else. That something that Warren Buffett's mentor, Benjamin Graham Matt said that in short run, the stock market is a voting machine, but in the long run it is a weighing machine. And Warren is even simpler way of describing that phenomenon is when he says that the stock market is a device to transfer money from the impatient to the patient. And he just he lives out this reality. You know, we talked just a few weeks ago on the Friday flight. We talked about how the average investor holds a stock position for like ten months these days. He used to be five years back in the nineteen seventies. But Buffett's holding period is on average seventeen years, which is a major gap. 00:21:32 Speaker 2: Years. Yeah, not. 00:21:35 Speaker 1: Long, So he's holding whatever, whatever he buys, whatever his investment is, he's holding it twenty times longer than the average individual. And there's just a that's a big gap. And if we're going to learn one thing from the goat investor, it's to worry less about immediate results and to have a longer timeline when it comes to evaluating our success. 00:21:54 Speaker 2: Yeah. Yeah, And you know, the great thing about going that route and being more patient when it comes to the results means that you just worry less about the short term market moves. You can worry less about that volatility. You can tune out the advice giving stock pickers. You can even avoid looking at your four one case statement most of the time. You can just remain blissfully ignorant, knowing that doing the right thing by buying and holding for the long term, that that's going to pan out decades down the road. You don't need to sweat the small stuff too. It makes me think of like our kids. I think oftentimes we can be so concerned about making sure that they're eating right, like did they take their vitamin? Oh, they got to cut, making sure that they're healing up fine. We're concerned about our kids' development essentially right, and it can be so difficult to see the progress that they are making, that they actually are growing up until you see maybe a friend that you know that you haven't seen in a long time. They're like, oh my gosh, and they're not doing it just to be you know, do the oh my gosh, your kids so a big thing. Like they truly are amazed at how quickly our kids are just sprouting up. 00:22:56 Speaker 1: Or even when we're fed those like Google memories and the from like three years ago, and it's impossible not to think that happened quick Yeah, yeah, you're right, And so I think on a day to day basis, it's hard to see the progress. But when we step out and we take a longer timeline, it's amazing to see the kind of progress that happens just from a human development standpoint with our kids, but also with like wealth building. When you look just month to month or week to week, and if we're checking our statements all the time, it can feel a little disappointing because it doesn't feel like the progress is happening quickly. 00:23:26 Speaker 2: I think it can be maddening. Yeah, Like what is it a watchpot never boils? Yeah, like you're just like waiting for It's just like where the compounder turns. I've heard about this this wonder eighth wonder of the world or whatever, but there's just some frustration because it's not happening as quickly as you might, you know, as you might hope it would. 00:23:41 Speaker 1: Yeah, okay, So the lady who wrote his biography, her name was Alice Schroeder, and she had this quote in there, and it said life is like a snowball. All you need is wet snow and a really long hill, And that just defines I think Buffett's approach to investing and approach to kind of the reality of compounding, And for some reason made me think of like Forrest Gump, life like a box of Chocolate's life is like a snowball. Well, life is like a snowball, but like compounding is just wonder if Forrest Gump would be allowed to be released today. Well, that's a good question. 00:24:13 Speaker 2: Makes want to go back and watch it. Yeah, it got been so long, Yeah, it's see. 00:24:16 Speaker 1: Well, I mean it just it helps you realize just that the compounding really comes about by investing regularly, but then also just by your ability to be incredibly patient. And it reminds me of a story I saw about a mother Matt like, but she wasn't just a mother, she was a grandmother and then a great grandmother as well. As it turns out, not only did she have eleven kids of her own, but those kids had fifty six grandkids. 00:24:39 Speaker 2: Which first of all, let's just start with eleven kids, Like, that's just that's kind of mind numbing, that's high. 00:24:44 Speaker 1: Flute and procreation right there, right, Yeah, that's a lot of kids to have. But and then like then fifty six grandkids. But then those kids had one hundred great aunt grandkids, which equals his family of one hundred and sixty seven, not even counting spouses. 00:24:56 Speaker 2: And that's crazy. 00:24:58 Speaker 1: I think it's physically impossible for an individual mother to give birth to that many children on her own. But with a little time and patience, you're talking about a lot of people. And so it's just kind of a goofy example. But similarly, like when a snowball starts rolling down a hill, that snow attracts more snow, you've got this like really large snowball over time, and the same thing happens with our money. It feels small, It feels incremental, especially in those first year, the first decade, and we talk to any investor and it's that first hundred thousand or whatever that's the toughest to get to. And then it's amazing, like a few years later that money working on your behalf started gaining speed. Yeah, this speed happens. The rapidity of your asset accumulation starts to happen so much more quickly. 00:25:39 Speaker 2: Yeah, And it's sort of like going back to the mother, it's not the number of kids that well, in her case, she did have a lot of kids. I guess like eleven kids, but she definitely didn't have one hundred and whatever sixty seven. It's not that she had all those kids. It's that her kids and then those kids that they all had kids, right, and so it's not necessarily the very fertile family that we're talking about. Yeah, so we're talking about gains upon your gains. Right, it's not the fact that you are going to have the ability to earn millions of dollars, but the money that you do earn and the money that you do invest, well, it's going to work for you. It's you're going to see a return on that money. And then that money is gonna combine with the money that you did set aside, and it's all gonna build upon itself. And compounding is just one of those things that I think we have a hard time grasping. We understand incremental growth, but when you start layering and adding things upon other things, that's when it kind of short circuits our brains to a certain extent and things go off the rail. 00:26:31 Speaker 1: It makes me thinking about like my first my first real job. I'm pretty sure my salary was like twenty four thousand dollars a year. 00:26:36 Speaker 2: Like it was. 00:26:36 Speaker 1: It was not great, and but I had I was putting in six percent of my paycheck and my employer match three percent. And when you think I'm just curious to know those dollars, I guess I could go back and do the math. But those dollars they felt very limited. But at the time, yeah, like it's like I'm not doing a whole lot, but what it was able to multiply into over the years, just because by by dint of I started by like where the market was basically eighteen years ago, Like those dollars have probably triple or quadrupled by this point in time, which is I mean, pretty incredible to think about even starting small, Like, I think that that gives me hope, right, and that should give all investors hope that even just when you begin with very little, it can it can amount to a whole lot. Totally For early investors, I think it can be really difficult. But even kind of where we are, we're kind of like more in the middle of our careers, and that's I think this is the period when you do start to see some of that speed increase, Like you start to see more gains, and you do get to witness your money starting to work harder than you would have ever. 00:27:39 Speaker 2: Imagined it working for you. Like honestly, even just money that I've got set aside in a savings account, a interest rates are going out, so it's nice to see a high return there. But just as you set aside a fat emergency fund to handle in our case, we like to keep six to nine months worth of living expenses in there every month, it's really cool to see the you know what it is that we're earning on that money. And that's just on savings. We're talking about investing here, So let's keep talking about some of these different life lessons that you can learn from Warren Buffett. Something else that's cool about Buffett is that, you know, we kind of talked about his partner in crime, Charlie Munger. Warren, I think he would have been great without Charlie. He was fairly successful before they met. I think he talked to a solid start before they together, like he was an attorney. But I don't think either one of them would be what they are today if it wasn't for that partnership. And so I think there's a little lesson for us to tease out here, because surrounding yourself with brilliant folks and honestly individuals who challenge the way that you think about things, that that can be so incredibly valuable. Warren Buffett, he said at one point that we've had nothing but fun together, and I think their relationship it's admirable and I think it's something that we can all learn something from. It just makes me think of the power of community as well. Joel. And when you've got individuals who you're you're doing life with, you've got shared goals. Well, the way that you achieve those goals might differ from person to person, but when you have similar goals laid out off into the future. I think that can be incredibly helpful when it comes to the ability to keep you accountable. And one of the cool things to do about Monger about Charlie Munger, Warren and Charlie have both said that they're basically each other's alter egos, and so I think what's cool about that is they found in each other complimentary skill sets. And what's cool is that I feel like you and I. I don't know. I was just thinking that I don't know, I get my Monger. Since I'm slightly older, you are like the older routch your guy with fewer words to share. But I think they recognize that and they were able to lean into that and in the same way I think you and I man our relationship. I guarantee that I would not be where I am with my financial goals, if you know, if Kate and I hadn't met you and Emily, and you know, I'm thinking maybe you say the same thing completely but completely even just leaning into those complimentary skill sets, whether you're looking for like a significant other or in our case, like a business partner, I think that can be incredibly When we. 00:30:00 Speaker 1: Started off as just friends and not business partners, and that friendship has led to a lot of great things, including just one of the by products, really, I think has been better financial habits, right as we've kind of like challenged each other in different ways, but then growing the business together, Like the business like we're what we're doing here wouldn't be the same if one of us was trying to go it alone, that's for sure, And. 00:30:18 Speaker 2: So initially it was more like small potato personal wins. Yeah, we've kind of seen that like grow into like something bigger. Yeah, for sure, totally fun. 00:30:25 Speaker 1: I mean, I don't know that we'll ever be as influential as as Warren and Charlie. 00:30:29 Speaker 2: But pretty much guarantee that. Well. 00:30:31 Speaker 1: Yeah, but it's cool, like we get to enjoy what we do and we get to help people every single week, which is something we're passionate about, and we get to kind of like enjoy it and spur each other on at the same time. Something else that I love about Warren Buffet, by the way, is that he's always willing to admit his mistakes, and he uses the word mistake a lot in his letters. Actually, especially in this year, he used it quite a bit, which just really shows to me that he's a humble guy. And he says that studying the company's stakes with his Partnermonger is more important than analyzing their successes. And I think there's a lot of truth in that. I think there's a lot of benefit to analyzing your mistakes. Not many of us want to do that or are prone to do that, though. And while knowing what is working is a helpful thing, well, I would say figuring out why your endeavor fell short can be even more helpful when it comes to moving forward and you know, achieving more success in the future. 00:31:24 Speaker 2: That's right. Yeah, So we're kind of talking about some of these life lessons. I guess we're kind of veering off course from from investing territory, but these are important to point out. I think. 00:31:32 Speaker 1: I think it just shows that he's more than just a great investor, Like he has other things to teach us about running a business, about how to live a successful life. And we don't agree with like or we're not trying to, like you said, emulate everything that he's done, but we also think he's got he's got more to give than just he's more than index rage. Yeah, and he's more than just a great numbers nerd. 00:31:53 Speaker 2: But along the line again of life lessons, I think one of the hardest things in personal finance is to not move the goalposts. Specifically, I'm talking about intentional spending here. It can be so easy to let lifestyle creep increase, causing us to change our habits and to start spending more than we should, and then we just end up falling into consumeristic behaviors that ultimately undermine our financial progress, and they don't really lead to any additional happiness, and it trure. Seems like Warren has been able to avoid that lifestyle creep. He's been able to avoid moving those goalposts, at least from where we're sitting. I know, seems like he still eats mcdonald'sretty much like every single day. Yeah, I don't think he's the font of healthy living in that regard. 00:32:40 Speaker 1: He would make a really bad TikTok nutrition influencer. 00:32:44 Speaker 2: He lives in the same house in Omaha that he bought back in nineteen fifty eight. Could he afford something bigger, something a little more updated, something nicer. Absolutely, that's an understatement to say that he could afford a different house. And granted I'm sure, he's got plenty of houses, probably all around the world. 00:33:01 Speaker 1: I know he's got a beach house something, But I don't know that he has a ton of houses either. I'm not sure that's a good question. 00:33:06 Speaker 2: Keep But considering he's the fifth wealthiest person in the entire world, he he could own entire countries. Yeah, essentially, it's okay if he has a few. How if he's got a beach house or if he's got a mountain house. It seems that he still takes joy in the simple pleasures and that he's able to spend money in the ways that bring him the most happiness. 00:33:25 Speaker 1: Yeah, and not just spending to try to fill a hole, to try to make himself happier, to try to like get a dopamine rush, which is what a lot of well I've see a lot of people are are chasing right through their consumption. Is that dopamine hit that's going to give them a feeling for a short period of time. But then you got to go back to the well and that creates some of that livestock creep. It makes it really hard. It's and I'm not gonna lie, like even as someone who's intentional about this or attempts to be intentional about this. It's not easy, right to spend intentionally to not move the goalpost. I think it is human nature to get more and then want more and so, but I think calling it out that one of the world's richest men has been able to keep this in check just says like, Hey, you don't have to inflate your lifestyle just because you've got to raise You don't have to change your desires just because you have more money in the bank. And I think Warren Buffett is a great example of that. And one of the things he said, Matt, he talks about contentedness, and he says, the big question about how people behave is whether they've got an inner scorecard or an outer scorecard. It helps if you can be satisfied with an inner scorecard. And basically, if anyone could flaunt their wealth but chooses not to because his innerscorecard is maxed out, it's Warren, right, And he's not trying to impress anyone. He's not wearing fancy suits. He doesn't care about the fanciest new trends in anything. And I don't know, I think that says a lot about him, and I think that's something we can all learn from. 00:34:49 Speaker 2: That's right. Yeah, I don't know and personally, but it certainly seems like he's a very content gentleman. But we have a few additional lessons that we're going to get to here right after the break, including the ability to focus on the things that matter. We'll get to that, plus a couple of others right after this. All right, we're back. 00:35:13 Speaker 1: We're still talking Buffett here and kind of talking about some of the lessons that we can learn Buffett Bainter from the investment goat, like he really there's just so much I admire about Warren Buffett. But in just a second, we're going to talk about the limitations of what he can teach us. But let's hit a few more things, Matt, that we can all learn from one of the greats. As we're kind of assessing his life, assessing his investment style, and so I feel like we've already done a lot on the investment front, but let's hit a few more things that we can all learn from one of the greats. And one of those things that it stands out to me is that Warren he realizes that taxes they just mean that you've been successful, and you don't often hear people get excited to pay their taxes. I still haven't filed mine yet this year, and I'm not necessarily looking forward to it. But Warren, he said it this year's annual meeting that at Berkshire, which again as a company he owns, we hope and expect to pay much more in taxes during the next decade. Hope and expect. I was like, dude, the fact that you hope to pay more taxes. Again, you never hear anybody's talk like that. And I think, but I think it's a really good way of looking at things, and I think it's a really good way of kind of thinking about the even your tax bill right, that's due coming up soon next month. And you know, we live in an incredible country, basically full of opportunity, and with great privilege comes great responsibility. What is that, Spider Man, right, something like that? Yeah, Peter Parker, Peter Barker, Yeah, And so like it's it's more than okay. We would say to use tax efficient vehicles and to be smart on the tax planning front. We talk about that kind of stuff on the show. We don't want you to pay taxes unnecessarily or to avoid investing in the best accounts because you are choosing to pay more in taxes for some reason than you owe. But it's also good to see that a bigger tax bill, it's not the worst thing in the world, and it typically it means that you're thriving inside of a really fortunate system that does up a lot of people for success. Right, And so I think Warren's ability to see that, to recognize that is a good thing, and it's something it was gonna make It's going to make me feel little differently about April eighteenth this year met By. 00:37:11 Speaker 2: The way, I think it's with great power comes great responsibility. Oh okay, my bad, it could be privilege. I forget though. I think you're right. No, I think it is great power. Yeah. But then let's talk about what Warren does with the billions of dollars that he's amassed. Well, we know he's not inflating his lifestyle in a significant way. Instead, he is giving a lot of that money away. He's actually given away more than forty eight billion dollars at this point, but he's not planning to stop there. He's signed the giving Pledge, and that means that he's committed to giving away ninety nine percent of his wealth when he dies. He signed that back in two thousand and six, and when he signed it, he said that were we to use more than one percent on ourselves, neither our happiness nor our well being would be advanced. This ninety nine percent can have a huge impact on health and welfare of others. And I think that's true. Well, I mean, when you are that wealthy, like what difference will those additional dollars make in their lives? And he even acknowledged how his gift is a less difficult commitment than most families when they are giving their money away. And so we wanted to touch on this because I feel like in the past we've sort of crapped on Warren before just about the incredible amounts of wealth that he has accumulated. But he has committed to giving it away. He's signed the giving Pledge, and we are all about giving, and you know, we think it creates just a more healthy relationship with your money. And we actually have a great article up on the website. It details how it is that you can go about giving away your money and how it's an awesome thing we'll make sure to link to that in the show notes for this episode. 00:38:48 Speaker 1: Yeah, and we talk in that article about how to do it effectively because there are a lot of scams out there, and there are just a lot of charities who aren't using your money in the way that you think they are, and so we want you to do due diligence. But before you start giving your money away, but we also want you to give your money away. We think that it creates like a healthy detachment from the money that comes into your life. It gives you a proper perspective on money, because money can't cure all your ills, and there's lots of good that can be done that you can actually see with your own eyeballs if you're giving your money away in the here and now. So I love that not only has Warren pledged to give away the vast majority of his wealth in the future, he's also doing it now. He's putting his money where his mouth is and he's giving away a lot of money every single year, which is cool. So I think that's something that we can all we aspire to emulates. And on that note, Matt, there's a good quote to end this podcast episode on and Warren says, basically, when you get to my age, you'll really measure your success in life by how many of the people you want to have love you actually do love you. I know people who have a lot of money and they get testimonial dinners and they get hospital wings named after them, But the truth is that nobody in the world loves them. If you get to my age in life and nobody thinks well of you, I don't care how big your bank account is, life is a disaster. And man, the guy again not just a great investor, although he is, he's the greatest, He's the goat. He has life perspective at this point that he's accumulated that he's just sharing with us regularly. I feel like through his shareholder letter, through interviews that he does and this is great perspective to have, right. I Mean, obviously what he's been able to achieve in his lifetime is admirable in a lot of ways. But that dedication and singular focus, right that it takes to a mass that kind of wealth. It's I will say, it's just not something that I'm terribly interested in. 00:40:31 Speaker 2: Matt. 00:40:31 Speaker 1: I don't think that's something that you're interested in we're not looking to accumulate. I think in the bio on our website it says like we're not looking to accumulate billions of dollars of wealth. That is not a goal that we have. And you know, more power to you, I guess if that's what you're after. But and even if it means having an outsized impact on a grander scale, sorry, like, that's just not the thing that I'm going for. But I still think that this is advice that's important to hear when we're younger because the trade offs of a not so great family life or not being active in our community, and they might not be worth the additional dollars in the bank account. Like if let's say you take a job that pays fifty thousand dollars more a year, but it causes you to be away from your family twenty days out of the month, maybe it's worth it, and maybe it's worth it for a short period of time. But these are the kind of trade offs and things we have to think about as people who want to be good with money but also don't want money to be the end all be all in our lives. 00:41:26 Speaker 2: That's right. Yeah, And again this is something that Warren has shared in his later years, and I think we would all be served to listen to that advice in the here now, because yeah, Warren, you know, he didn't have the greatest family life. His relationship with his first wife. It was kind of weird that, like they had an open marriage. Yeah, and that's not something I'm interested in replicating in my own life. But Warren Buffett, he's. 00:41:49 Speaker 1: Since you mentioned at one point, like when you're reading the oud, didn't he step over one of his kids who was throwing a tantrum or something? We feel like we to go up to his office, because yeah, that was. 00:41:58 Speaker 2: What it was like as a father for him. I mean, he was singularly focused on business and on reading up on the balance sheets of different businesses that he was basically looking to scoop up at a deal. 00:42:08 Speaker 1: So if we're talking about one thing, maybe that one of the things that we don't admire about Warren, or one of the things that we don't desire, is kind of the lack of balance that he had at least for a bunch of years. 00:42:17 Speaker 2: Act. 00:42:18 Speaker 1: I think I saw something recently that he plays a lot of bridge now apparently like eight hours worth of Bridge. 00:42:23 Speaker 2: He's always played a lot of Bridge. Oh really? Oh yea, yeah, so even when he was even when he's younger, it was something he was infatuated with. Yeah, well, I guess it was an infatuation. It's a dedication to a game that he loves, which is great. 00:42:34 Speaker 1: I'm all about cheap hobbies and stuff like that, but I think that's cool. But I guess even while he had a hobby something that he enjoyed doing besides just work, that work for a whole lot of years definitely took away from, Yeah, some of the relationships that I would imagine if you would ask him in a personal context, he would say he was just he had dedicated more time and energy into I. 00:42:55 Speaker 2: Definitely think so. Yeah, and yeah, we don't want a carbon copy and replicate his life. And you know, essentially there's a zero chance that we could even come close to his investing prowess, but there is still a bunch that we can learn. At the end of the day, we want you to be a long term, widely diversified investor, not somebody who's jumping in and out of stocks, who's watching all the latest headlines. That's something that Warren recommended, and Joel, that is how you and I how we invest our dollars as well. Okay, one last thing I appreciate about Warren is that it seems like he's just always been an incredible teacher, right. He shares his wisdom, and I think that's something that you and I seek to do here on the show, where we're seeking to help those who follow Hot of Money, who listen to our show and hope kudos to a guy that we have mad respect for, completely out there doing the good work and we love the dude. I think that's what we're doing. I'd love to meet him someday. I mean, I love Warren. You're welcome on the podcast any time you want to come on. So glad we could kind of talk about our buddy, our pal, Warren Buffet today on the show. That's a right, man. Let's mention the beer that you and I enjoyed during this episode. This was a blender and I guess black raz that's the I'm guessing they make multiple different blenders, but this is the Berlin or Vice that is brewed with blackberries and raspberries. What were your thoughts on this beer? Buddy? 00:44:09 Speaker 1: Oh man, this was delightful. It was light where we are. It feels like spring right now already and particular day. Yeah, it is quite warm, yes, and which is so this is a perfect beer for that. It's like a delightful sour. And I love berry sours. I will say my kids would be disappointed that any berries went into a beer and not directly into their mouths. Like my kids eat so much money's worth of berries this time of berry season. Man, Like, yeah, granola with yogurt on it this morning, topped with all the berries. 00:44:37 Speaker 2: Yes, they were like all of it. 00:44:39 Speaker 1: Like raspberries, blackberries, strawberries, like they don't discriminate, they want them all and so but yeah, I love some good berries in my beer. 00:44:45 Speaker 2: And this was I kind of like the black ras combo. Yeah, it was tart, it was fruity. I feel like it had the right amount of sweetness going on to kind of back the flavor of those berries. But I also had the right amount of wheatness as well. So this is a Berlin vice, which is I like that wheat. Yeah, sweetness and weatness. Berlinervice is a German style wheat and so oftentimes the flavor that you're left with in your mouth after you swallow and you're kind of sitting there doing the kind of thing. It's like this wee weediness. It reminds me of Captain Crunch, specifically oftentimes with Berlin Device's so definitely picked up some of those notes with this one and I liked it. So, Matthew, thank you for donating yet another fantastic beer here to the show again. This one. I don't know why. 00:45:30 Speaker 1: You just made me think of Katie Perry, like, but what, I drank some Black Rats and I liked it. 00:45:37 Speaker 2: I got you. But yeah, this is a beer by New Park Brewing, and that's gonna be it for this episode. We will link to some of the different resources that we had mentioned and you can find those show notes up on our website at how Tomoney dot com. But dude, that's going to be it for this one. Until next time. Best Friends Out, Best Friends Out.