As Your Survival Guy, my job is to share what I know from my lifetime of experiences. I’ll never forget when my father-in-law Dick Young told me how it’s been the miracle of time that’s been the most impactful ingredient to his investment success—that and not making stupid mistakes. I’ve learned a lot from Dick, like keeping it simple and not worrying about the next guy. Guess who else is in the same boat? In a recent statement, Warren Buffett lauded compounding, suggesting that the real action takes place in the last twenty years of a lifetime. The Wall Street Journal’s Karen Langley reports on Buffett’s comments:
“The real action from compounding takes place in the final twenty years of a lifetime,” he wrote. “By not stepping on any banana peels, I now remain in circulation at 94 with huge sums in savings—call these units of deferred consumption—that can be passed along to others who were given a very short straw at birth.” Berkshire’s Class B shares have rallied 35% this year, compared with a 25% gain by the S&P 500. Earlier this year the company joined a small club of U.S. businesses worth more than $1 trillion.
Action Line: Set yourself up for compounding by saving til it hurts now. You can’t compound what you don’t have. When you want to talk about building an investment plan, email me at ejsmith@yoursurvivalguy.com
