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For decades, Berkshire Hathaway’s annual meetings gave shareholders the opportunity to pick former CEO Warren Buffett’s brain on a wide range of topics.
But one investor who attended the conference back in 1999 cut right to the chase.
“Mr. Buffett, how do I make $30 billion?” he asked (1).
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As always, the Oracle of Omaha conveyed complex answers in simple terms. Here are the three crucial rules that helped the 95-year-old accumulate a massive fortune.
Start young
Buffett’s best advice for investors is to get started as early as possible. He has a simple metaphor to explain his wealth-building strategy.
“We started with a little snowball on top of a very tall hill,” he said. “We started at a very early age in rolling the snowball down, and of course, the nature of compound interest is that it behaves like a snowball.”
The length of Buffett’s career is a key piece of his enormous wealth. He bought his first stock at the age of 11. He’s now 95 years old and still actively investing.
The majority of Buffett’s wealth was accumulated after he turned 65. In 1999, his net worth was just $30 billion. Today, he’s the 11th richest person in the world — with a net worth of $140.6 billion (2).
In other words, one of the keys to Buffett’s long-term success was investing early and often.
Roughly 49% of Americans say they don’t invest because they don’t have enough money — believing that you need about $1,000 to even get started, according to the 2025 Modern Wealth Survey conducted by Charles Schwab (3).
Platforms like Acorns are making investing more accessible by letting you invest your spare change from everyday purchases into a diversified portfolio of ETFs.
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Read More: Here’s the average income of Americans by age in 2026. Are you falling behind?
Search for small companies
Buffett said that if he started investing again today with $10,000, he would focus on small businesses.
“I probably would be focusing on smaller companies because I would be working with smaller sums and there’s more chance that something is overlooked in that arena,” he said at the shareholder meeting.
In his early days, the billionaire investor focused on companies that would be considered small-caps. He bought a tiny furniture company in Nebraska in 1983 when it was still expanding across state lines. Before that, he acquired See’s Candies for $25 million when it had made just $4 million in annual profits in 1972.
By 2019, the company raked in $2 billion in pre-tax income for Berkshire Hathaway — an 8,000% return on investment (4).
These small businesses were overlooked, undervalued and had room to grow, which gave Buffett the chance to buy in early.
This trend continues today. Small-cap stocks were around 30% cheaper than large-cap stocks as of the start of the final quarter of 2023, according to an analysis by BNP Paribas (5). This valuation gap is near a 25-year low, suggesting the potential for small-cap outperformance as market conditions shift, based on a report by Royce Investment Partners (6).
But identifying small-cap stocks can be a challenge.
That’s where platforms like Moby can come in. Moby offers expert research and recommendations to help you identify strong, long-term investments backed by advice from former hedge fund analysts.
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Moby’s team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you. Their research keeps you up-to-the-minute on market shifts and can help reduce the guesswork behind choosing stocks and ETFs.
Plus, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes.
Buffett’s bet on See’s Candies generated a 160% per year ROI, but even he almost passed over the acquisition, thinking it was too expensive at the time.
“I almost blew the See’s purchase — the seller was asking $30 million, and I was
adamant about not going above $25 million. Fortunately, he caved,” Buffett wrote in Berkshire Hathaway’s 2007 annual shareholder letter (7). “Otherwise I would have balked, and that $1.35 billion would have gone to somebody else.”
Circle of competency
Thomas J. Watson Sr., the founder of IBM, once said, “I’m no genius. I’m smart in spots — but I stay around those spots,” and that’s the mantra Buffett applies when he’s investing (8).
Investing is risky, and Buffett has mitigated that risk by sticking to industries he understands. Much of his portfolio is focused on either consumer goods businesses or financial service companies. This disciplined approach helps him manage risk and make confident, long-term decisions.
Ordinary investors can similarly reduce risk by sticking to their circle of competency and avoiding speculation.
If you’re new to investing and your circle of competency is small, you might want to consider working with a dedicated financial advisor to increase your knowledge base.
A good advisor can help ensure your investment strategy aligns with your personal goals and long-term financial plan.
But with over 321,000 financial advisors in the U.S., according to the Bureau of Labor Statistics, where do you start?
With Vanguard, you can connect with a personal advisor who can help assess how you’re doing so far and make sure you’ve got the right portfolio to meet your goals on time.
Vanguard’s hybrid advisory system combines advice from professional advisers and automated portfolio management to make sure your investments are working to achieve your financial goals.
All you have to do is fill out a brief questionnaire about your financial goals, and Vanguard’s advisers will help you set a tailored plan and stick to it.
Once you’re set, you can sit back as Vanguard’s advisors manage your portfolio. Because they’re fiduciaries, they don’t earn commissions, so you can trust that the advice you’re getting is unbiased.
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
CNBC (1); Forbes (2), (8); Charles Schwab (3); Business Insider (4); BNP Paribas (5); Royce Investment Partners (6)); Berkshire Hathaway (7)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.