How did Warren Buffett become so rich?

4 min read
How did Warren Buffett become so rich?

In 1930, During the great depression, there was a family who was struggling with their lives and after so many efforts one of the family member (father), failed to get hired at the family grocery store. Without a job, and without any money after a run on the banks, the family of four ran up a tab of grocery bills at the store to put food on the table, and even then, his mother sometimes skipped meals. Among the family, there was a little boy who was very depressed to see his family’s situation.

Somehow times passed and the family gradually achieved financial health which was worth to live. Father started a small stock brokerage firm. The young boy started showing an aptitude for numbers. He became obsessed with timing everything, calculating odds, even tallying the frequency of the letters that appeared in the Bible most frequently.

The only constant thing that the boy had was ‘I just don’t want to be poor’

For the money, he started collecting Coke bottles to make some money by selling them at a very young age.

He liked to read more than other kids.

Started selling CocaCola and gums door to door and throwing 500 newspapers in a day early in the morning to collect some money. ( one paper = one penny).

At the age of 10, he took a book from a library ‘One Thousand Ways to Make $1000’ and like the idea of buying a penny weighing machine as his first investment from his collected money. By the time he was 15, he already had a net worth of about $6,000.

He sat and calculated how much it cost to buy another machine and how much time is required to do so. He bought another and invested somewhere else and so on.

At 11 years old, he was already buying stock: multiple shares of Cities Service Preferred for $38 apiece. When he was just a teenager, he filed his first tax return.

  • By the time he graduated high school, he had already bought a stake in a 40-acre farm in Omaha, Neb.
  • At age 21, his net worth was just $20,000.
  • By the time he reached 26, his net worth was between $140,000 and $174,000.
  • He topped the $1-million mark at around when he was 30 years old.
  • By age 43, his personal net worth was at a high of $34 million.
  • He topped the $1-billion mark at around when he was 56 years old.
  • Today, At the age of 87, his net worth is $82 billion.

After so many years, he was the owner of the company which was named as the fourth largest company in Fortune 500. He is the only person who has ever built a company from scratch that is in the Top 10 of Fortune 500.

His company’s name is Berkshire Hathaway and his name is Warren Buffett, the fourth richest man in the world.

In 1972, he purchased See’s Candies stocks for $25 million, and the company would haul in about $2 billion in profits over the next 50 years.

Berkshire Hathaway is actually a parent company that owns a large number of separate businesses that operate independently of each other.

Buffett bought a controlling share in Berkshire Hathaway in 1965 and bought the stocks in a few thousand dollars, Today, one share of the company is worth Rs. 2.1 Crore Rs. or

Now, come back to your normal life. Everybody wants to create wealth.

It doesn’t matter whether you want to learn it or not, the rules won’t change, they never will.

Those who still haven’t found the answer should know that stock market is not game to play or a place where making money is easy, it is a platform which demands knowledge, expertise, and luck and that too ‘simultaneously’, if any one thing is missing then you are going to lose for sure.

You need to have a demat account with you to trade/invest in stocks. I use Upstox because it is brokerage free.

Analysis of financial markets is either fundamental or technical. Fundamental analysis focuses on financial statements in assessing the condition of a company and in predicting its future performance. Technical analysis focuses on a stock’s historical price pattern, as portrayed on charts, to predict future price movements.

The fundamental analysis comprises of Company’s management, cash flows, valuations, books, debts, past performances, dividend, its short-term, and long-term potential to back its debts, vision, mission, scope, strategies, future perspective, key people, bottom line performance over time, earnings etc. (You can learn it here Stock Fundamental Analysis)

The technical analysis comprises of Candlestick charts, different indicators to find out the stock current trend, entry points, and exit points. Different strategies and indicators for daily trade mechanism. (You can learn it here Technical Analysis)

Note: Without proper knowledge about the stock market never try to dive in. With every good thing, there is a dark side, the Indian stock market is the fastest wealth destroyer also in case you invest without proper knowledge about how it works. Here, if one is making BIG means on the other side somebody is BIG.

Akshay Seth


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