Latest news with #OracleofOmaha
Yahoo
29-05-2025
- Business
- Yahoo
Warren Buffett Says This Vanguard ETF Is One of the Best Investments Out There. It Could Turn $1,000 Per Month Into $228,000 in 10 Years.
Investors want to be like Warren Buffett and pick individual stocks successfully, but he recommends a simpler approach for the average person. What seems like a relatively small amount of capital can lead to incredible wealth over time. All that's required for stock market success is patience, discipline, and a long-term mindset. 10 stocks we like better than Vanguard S&P 500 ETF › Few will argue if you call Warren Buffett the greatest investor of all time. The returns speak for themselves. Between 1965 and 2024, under the Oracle of Omaha's leadership, Berkshire Hathaway has seen its share price rise at a compound annual rate of 19.9%, nearly double the gain for the S&P 500 index. This track record is unbelievable, partly because of how long it has gone on. But while the average investor might take this as a recommendation to go out and start picking individual stocks, Buffett's advice is quite simple. He believes the best strategy for most people is to just buy a low-cost S&P 500 index fund. The Vanguard S&P 500 ETF (NYSEMKT: VOO) is one that immediately comes to mind. This sounds boring at first. However, consider that a $1,000 monthly investment could eventually turn into a significant $228,000 nest egg in just a decade's time. This shows how smart Buffett's idea actually is at building wealth in the stock market. Over nearly the past century, the S&P 500 has produced a total annualized return in the neighborhood of 10%. Lately, though, the numbers have been better. In the past 10 years, the Vanguard S&P 500 has generated a total return of 225%, which equals a 12.5% annualized gain. No one will argue with this type of result. A number of factors could be at play here. There's unprecedented monetary and fiscal stimulus, propelled by low interest rates, that drove economic growth during much of that period. Passive investing is also in the spotlight. It's worth mentioning that retail investors are now accounting for a higher share of stock buying. There's also the monumental rise of dominant tech enterprises. It's always important to remember that historical returns don't mean future success is guaranteed. However, if we assume that the trailing-10-year returns repeat in the future, which may or may not happen, investing $1,000 per month (for a total of 120 investments) in this ETF can result in $228,000 in May 2035. The key factor to remember here is the consistency at which capital gets allocated. This is called dollar-cost averaging (DCA). Investors don't need to successfully time the market, which is something Buffett has clearly been a master at. DCAing allows you to buy in at various price points. The only thing that's required is discipline, patience, and a long-term mindset The beauty of this strategy is that you don't need to have a fancy degree, expert financial modeling or business analysis skills, or a lot of time on your hands. You can leave that to the so-called professional fund managers, most of whom actually lose to the S&P 500 over long periods of time. This is a very low-maintenance strategy, which should allow you to stick to it for a decade or more. By owning the S&P 500, investors gain access to all sectors of the economy with broad diversification. You're essentially betting on the growth and innovation of the U.S. economy. Buffett would agree that this is a smart approach. The Vanguard S&P 500 ETF only carries an expense ratio of 0.03%. So, for every $1,000 you invest, a tiny $0.30 gets paid to Vanguard every year. This helps the massive asset management firm handle its operating costs, whether that's for marketing or paying its staff, among other things. When it comes to your investments, it's easy to get sucked into what sounds complex or exciting. But here's where being boring is absolutely an advantage. Buying $1,000 worth of the Vanguard S&P 500 ETF every single month can result in huge wealth between now and 2035. Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $830,492!* Now, it's worth noting Stock Advisor's total average return is 982% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Neil Patel has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Berkshire Hathaway and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy. Warren Buffett Says This Vanguard ETF Is One of the Best Investments Out There. It Could Turn $1,000 Per Month Into $228,000 in 10 Years. was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
28-05-2025
- Business
- Yahoo
10 Ways To Build Wealth Fast
Wealth-building is a process that generally takes time. Although the idea of becoming an overnight millionaire is appealing for many, especially for those working on savings plans and retirement accounts, the only real way to get rich overnight is an inheritance or a lottery win. Learn More: For You: Ironically, the best way to build wealth 'fast' is to chart out a prudent path toward long-term gains. The quicker you can start saving and investing, the faster your money will compound, which is the true magic behind growing wealth over time. Here are 10 ways you can grow your net worth, achieve your financial goals and put some extra money in your savings account as rapidly as possible without taking on undue risk. The S&P 500 index doesn't guarantee profits, but it's proven itself time and time again to be a tremendous generator of long-term wealth. In fact, most investors are surprised to learn that the 'risky' stock market has never lost money over any 20-year rolling period. And yet, the long-term average return of the S&P 500 is north of 10%. This means the S&P 500 index has a tremendous risk/reward profile over the long run. Even legendary investor Warren Buffett, the 'Oracle of Omaha' himself, has directed his trustee to keep 90% of his money in an S&P 500 index fund after he passes. Dividend-paying stocks may seem like a slow and boring way to build wealth, but they are one of the best ways to tap into a solid and growing source of income The so-called 'Dividend Aristocrats' are large, well-known companies in the S&P 500 index, like Coca-Cola and McDonald's, that have raised their dividends for at least 25 years in a row. This means that those who bought these companies 25 years ago are earning huge effective yields on their original investment amount. Combined with the potential for capital gains, the Dividend Aristocrats can be a great way to build wealth. As of early 2025, the highest-paying dividend stock is Walgreens Boots Alliance Inc. (WBA) with a yield of 10.7%. Read Next: One of the key ways to build wealth fast — and over the long term — is to earn passive income. And one of the best ways to generate passive income is to own one (or several) rental properties. With a well-managed rental property, you'll receive a steady stream of income every month, with little additional effort required on your part. While you'll have to find tenants to move in and will have to deal with occasional maintenance issues, your income will essentially be on autopilot. Unlike your mortgage payment, your rents will continue to rise over time, meaning your tenants will be paying some or all of your mortgage while you watch your properties appreciate. The cost of living goes up nearly every year, and so does your experience and value to your company. As such, you shouldn't be afraid to ask for regular raises, both to keep up with the cost of inflation and to be paid what you're truly worth. This doesn't mean you should constantly pester your boss about getting paid more, but you should make the case, when appropriate, that your value should be reflected in your salary. Those who fail to ask for raises tend not to get them, so don't overlook this source of building your wealth. Most of the world's billionaires either inherited their money or started their own businesses. If you're looking to generate a large amount of wealth, starting and growing a successful company is one of the most likely paths. Of course, entrepreneurship is a risky proposition, as many new companies fail in just the first few years. However, if you can create a solid business idea, raise the appropriate funding and get the right people working for you, this high-risk, high-reward path can pave the way to a lifetime of wealth. If you're going to spend your life working for others, you'll have to make yourself as valuable as possible if you want to generate the most wealth. Educating yourself in a wide variety of fields and developing a diverse skill set are some of the best ways to demonstrate your value as an employee. Focus on specialized skill sets that are in high demand, such as those in the high-paying tech and financial industries, to give yourself the best opportunity to grow your wealth rapidly. Swiping your credit card to invest in yourself is money well spent as it comes with high returns. It's hard to generate sizable wealth on a single salary, even if you save a large portion of it. To build wealth fast, set up multiple streams of income. For example, in addition to your day job, pick up a side hustle that matches your talents and abilities. If you're a freelancer, try to find additional clients in a variety of different industries. Not only will this bring you additional income, but it will also help protect you during economic downturns if you happen to lose one of your sources of income. You can't begin any type of wealth-generation plan without having money to invest. As soon as you start drawing an income, make it your top priority to save as much money as you can. One strategy often recommended by advisors is to 'pay yourself first,' meaning put money in savings immediately when you receive your paycheck, even before you pay your bills. This type of 'forced savings' will require you to trim your discretionary spending but will also result in rapidly growing wealth. You'll never generate any wealth at all if you spend more than you earn. To set yourself up for a lifetime of prosperity, it's important to create a strict budget and stick to it. Make sure that in addition to all of your unavoidable expenses, you've got a significant line item for saving and investments. Every month that you can come in under budget, you're adding to your pool of lifetime wealth. Although being too speculative is a surefire way to risk all the savings you've worked for, being too conservative can be equally damaging in terms of limiting your wealth. Taking some risks in your financial life — from investing a bit more aggressively to starting your own business — is a necessary component if you want to generate outsized levels of wealth. Owning some stocks, real estate, your own business or even some cryptocurrencies are way to gain exposure to higher potential returns on your investments. Just understand that while speculation has a role in generating wealth, it also brings additional risk to the table. Caitlyn Moorhead and Brooke Barley contributed to the reporting for this article. More From GOBankingRates Mark Cuban Says Trump's Executive Order To Lower Medication Costs Has a 'Real Shot' -- Here's Why The 5 Car Brands Named the Least Reliable of 2025 This article originally appeared on 10 Ways To Build Wealth Fast
Yahoo
19-05-2025
- Business
- Yahoo
Will Anything Change Now That Warren Buffett Has Announced His Retirement as CEO of Berkshire Hathaway?
Warren Buffett said that he will retire as CEO of Berkshire Hathaway at the end of 2025. Investors have long bought Berkshire Hathaway as a way to invest alongside Buffett. His replacement will be Greg Abel, who has been with the company since 1999. 10 stocks we like better than Berkshire Hathaway › Every year, shareholders, investors, and the media flock to Omaha, Nebraska, for the Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) annual meeting. It is a chance for Wall Street and Main Street to hear directly from Chief Executive Officer Warren Buffett, whose long-term investment success has earned him the nickname "the Oracle of Omaha." This time, however, what Buffett had to say was a bit different because he announced his plan to retire at year-end. Will anything change now that this leadership transition is finally taking shape? Before discussing Buffett's retirement, it is important to first dig into Berkshire Hathaway's business model. Although when it has to be categorized, it is usually placed in the financial sector because of its large insurance operations, it's really a gigantic, diversified conglomerate. Where most companies can summarize their businesses in a paragraph or two, Berkshire Hathaway's business description runs more than 20 pages. Its broad portfolio of wholly owned businesses that get broken out for detailed reporting every quarter includes insurance, as noted, but also utilities, pipelines, and railroads. Then there are the more than 100 businesses it owns that only get discussed in the annual report and not broken out in detail. Even then, the discussions are usually fairly brief given the sheer diversity and number of businesses that Berkshire Hathaway owns, from retail to manufacturing. Investors buying Berkshire Hathaway with the goal of investing alongside the Oracle of Omaha have the right idea. In some key ways, the conglomerate is more like a mutual fund than an actual operating business. Further enhancing that view is the small collection of rather large investments that Berkshire Hathaway has in publicly traded companies like Coca-Cola (NYSE: KO), Chevron (NYSE: CVX), and American Express (NYSE: AXP). To answer the question of whether anything will change after Buffett hands the reins to Greg Abel, his chosen successor, the simple reply is "Of course." There's no way that things couldn't change, since Buffett is Buffett and Abel is Abel. Every investor's approach is slightly different, hard stop. However, Abel joined Berkshire Hathaway in 1999 when the company bought MidAmerican Energy. That means that he has been steeped in the Berkshire Hathaway ethos for more than a quarter of a century. He earned enough trust to rise up through the ranks until he was, basically, Buffett's right-hand man. The two obviously work closely together, and have for years. While Abel will have his own investment approach, that approach has been directly molded by Buffett. You might call Buffett the mentor in this relationship, in a similar way to how Benjamin Graham mentored Buffett. However, Buffett has spent a lot longer tutoring Abel. And it is important to note that Abel has probably had a hand in every major investment decision at Berkshire since Buffett's late partner Charlie Munger, passed away in 2023. That said, it's likely Abel's involvement started well before that. He isn't simply stepping in with no knowledge of, or history with, Berkshire Hathaway. There's a safety valve here because even as Abel takes the reins as CEO, Buffett isn't walking away from the company he built. He is slated to remain the chairman, which means he's still Abel's boss. Their relationship will be vastly different, since Buffett won't have day-to-day operational control of the business, but he will be there as a sounding board and to provide guidance if it's needed. So will things change at Berkshire Hathaway after Abel takes over? Yes. It is unrealistic to think that a new CEO won't make some changes. Will things change drastically from the way that Buffett ran the show? Probably not. Before you buy stock in Berkshire Hathaway, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Berkshire Hathaway wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $642,582!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $829,879!* Now, it's worth noting Stock Advisor's total average return is 975% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 American Express is an advertising partner of Motley Fool Money. Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway and Chevron. The Motley Fool has a disclosure policy. Will Anything Change Now That Warren Buffett Has Announced His Retirement as CEO of Berkshire Hathaway? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-05-2025
- Business
- Yahoo
Warren Buffett Nearly Made His Biggest Investment Since 2022. Here's What's Holding Him Back.
Berkshire Hathaway has been a net seller of stocks for 10 straight quarters. Buffett would love to spend the money on an investment, but he's waiting for a good opportunity. Average investors have a big advantage over Buffett. 10 stocks we like better than Berkshire Hathaway › Warren Buffett has overseen the investment portfolio at Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) for 60 years. In that time, he's produced mind-boggling returns for shareholders. Since Buffett took over the company in 1965, Berkshire shares have returned an average of 20% per year. Over the course of 60 years, that adds up to a whopping 6,135,058%. Even if you had waited until the end of the trading session when Berkshire announced Buffett's takeover and bought a single $18 share, it'd be worth over $750,000 as of this writing. That's why the investing world pays close attention to the moves Buffett and his team of investment managers make in Berkshire's portfolio. Unfortunately, the Oracle of Omaha has been selling much more than he's bought over the last two and a half years. The last big investment he made was in Alleghany Corp. in 2022, which Berkshire acquired for a value of $11.6 billion. At the company's annual shareholder meeting earlier this month, Buffett said he and the team came pretty close to spending $10 billion recently, which would have been Berkshire's biggest acquisition since Alleghany. But one thing held him back and continues to hold him back from making any big investments right now. Buffett contends that investment decisions aren't as complicated as some experts might lead you to believe. In fact, he says a decisions can be downright easy as long as there are two things in place. "We'd spend $100 billion," Buffett told the audience after revealing Berkshire came close to a $10 billion deal. "Those decisions are not tough to make when something is offered that makes sense to us and that we understand and offers good value." If the business is understandable and offered at good value, Buffett will buy it. Perhaps in more recent years, there should be a caveat that Buffett probably isn't looking at deals unless they're in the $10 billion range or bigger. Buffett later commented, "$10 billion wouldn't have done that much," referencing Berkshire's approximately $630 billion in liquid assets between its cash and equity portfolio. But Buffett's simple investing philosophy has led to unparalleled long-term success, and it's not like the 94-year-old has completely lost touch with how businesses work. The explanation for why it's been so tough for Buffett to invest a lot of money recently is that there's not a lot of value in the market, especially among bigger companies. To run a business like Buffett runs Berkshire Hathaway requires being very opportunistic. Buffett and his team have to spot an opportunity and be prepared to take advantage of it when it arises. A good opportunity rarely lasts very long. "Occasionally, very occasionally, I don't know when it will happen, it could be next week, it could be five years off, but it won't be 50 years off, we will be bombarded with offerings that we'll be glad we have the cash for," Buffett said at the meeting. All this is to say that if you want to outperform a benchmark index like the S&P 500, you have to wait for the right opportunities. That said, Buffett says there's nothing wrong if an investor wants to buy an index fund and keep all of their money passively invested. In fact, that's what he's instructed the executor of his estate to do. But for investors looking for an opportunity to buy individual stocks, the opportunities are few and far between. The S&P 500 trades for a very high valuation relative to its historic average. Its forward P/E ratio of 20.4 sits well above the mid-teen level investors are used to seeing. The CAPE ratio, which looks at the last 10 years of inflation-adjusted earnings, has climbed above 35, while it typically sits around 20. But average investors have a big advantage over Buffett -- they can go small. Smaller companies aren't nearly as expensive as the biggest stocks in the market right now. Buffett would agree, as the purchases he has made over the last two and a half years have all been near the bottom end of any company Berkshire could consider to move the needle. The small-cap S&P 600 and mid-cap S&P 400 both trade closer to the 15 times forward P/E investors are used to, so it's worth looking for opportunities among these sectors. Before you buy stock in Berkshire Hathaway, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Berkshire Hathaway wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $642,582!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $829,879!* Now, it's worth noting Stock Advisor's total average return is 975% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 Adam Levy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy. Warren Buffett Nearly Made His Biggest Investment Since 2022. Here's What's Holding Him Back. was originally published by The Motley Fool
Miami Herald
18-05-2025
- Business
- Miami Herald
Warren Buffett, Berkshire Hathaway sell banks to buy booze
Warren Buffett kicked off May with a bombshell. After 60 years at the helm, Warren Buffett will be stepping down as CEO of Berkshire Hathaway at the end of the year. The 94-year-old investing legend will cede the role to 62-year-old Greg Abel, a Berkshire veteran who has been with the company since 1999. Related: Warren Buffett's Berkshire Hathaway predicts major housing market change soon Since he took over in 1965, Buffett has guided Berkshire Hathaway from being a textile manufacturer to an investment company. Today, the sprawling conglomerate has 400,000 employees. While the Oracle of Omaha's longevity is revered in most circles, his returns as an investor are even more impressive. Berkshire Hathaway's average annual return was about 19.8% from 1965 to 2023, nearly doubling the S&P 500's 10.1% annual average during the same period. In 2024, Berkshire improved on that impressive performance with a 25.5% total return, slightly outperforming the S&P 500's 25% return. So when Warren Buffett and Berkshire Hathaway make a move, people pay attention. Recently, Berkshire Hathaway has been piling into short-term U.S. Treasury bills. Berkshire currently holds a $314 billion stake that represents 5% of all outstanding short-term government bills, according to a recent note from JP Morgan, taking advantage of interest rates that have dipped recently but remain in record-high territory. Buffett has purchased T-bills in tranches as large as $10 billion, according to the report. The government sells those bills in terms ranging between four and 52 weeks. But if you're in the mood for returns greater than 4%, Berkshire Hathaway's recent 13-F filing gives insights into its more lucrative investment decisions. Image source: Shutterstock If one can glean a trend from Berkshire Hathaway's latest 13-F filing with the Securities and Exchange Commission, it's that the firm is bearish on the banking sector and bullish on alcohol. Buffett increased his stake in Constellation Brands STZ - the brewer behind Corona, Modelo, Robert Mondavi, and other alcohol brands - to more than 12 million shares, more than double the 5.6 million initial shares it bought at the end of the year. Related: Warren Buffett sends strong message on trade, tariffs Berkshire now holds a 6.6% stake in the company. Constellation shares were up 1.7% at the last check-in on Friday afternoon trading. To pay for the purchase, Berkshire slashed its exposure to the banking sector. The company exited its three-year-old stake in Citigroup, selling the more than 14.6 million shares it held during the first three months of the year. It also cut its long-term holding Bank of America by 48.6 million shares and trimmed its Capital One holding by just 300,000 shares. On May 3, the 94-year-old Warren Buffett announced that he will be stepping down as CEO of Berkshire Hathaway. "I don't have any trouble making decisions about something that I was making decisions on 20 years ago or 40 years ago or 60 years," Buffett recently said in an interview. "I will be useful here if there's a panic in the market because I don't get fearful when things go down in price or everybody else gets scared." Still, Buffett does acknowledge that, frankly, he's gotten old. "I didn't really start getting old, for some strange reason, until I was about 90," he said in the interview. "But when you start getting old, it does become - it's irreversible." He says he's started occasionally losing his balance, having trouble with recall, and experiencing deteriorating vision. Related: Veteran fund manager unveils eye-popping S&P 500 forecast The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
