How Cheap Is Warren Buffett? Is He Happy Being Cheap? | Exploring Markets

How Cheap Is Warren Buffett? Is He Happy Being Cheap?

Warren Buffett is often called the greatest investor America has ever seen. But maybe there's more to the story. Maybe it also has to do with how well he saves and how frugal he is. Some people might even call him "cheap." But there's no shame in that if you love it and if it works for you.

So how cheap is Buffett? Get ready and read this:

1. Bill Gates, in his 2017 annual letter, wrote about Warren Buffett while they were traveling in China. Specifically, he recalls one moment when they went to McDonald's in the middle of Hong Kong and Buffett offered to pay. But Buffett did not want to use cash. Or even a credit card. Instead, he wanted to use coupons! Yes, Buffett pulled out coupons from his pocket to pay. The richest man! Gates writes:
"Remember the laugh we had when we traveled together to Hong Kong and decided to get lunch at McDonald's? You offered to pay, dug into your pocket, and pulled out … coupons!"

2. There is more to this story. In 1958, Buffett bought the current home he lives in for $32,000. Today, that home is worth $260,000 and he still lives in that home today. Buffett has never once moved. If you were one of the richest people on Earth, how many homes would you own and where in the world? Buffett still lives in the same home today.

3. Every morning, whenever Buffett decides to eat Breakfast out, he goes to McDonald's. And he never pays more than 3 certain amounts: two sausage patties for $2.61, a sausage, egg and cheese for $2.95 or a bacon, egg and cheese for $3.17. That's it. He NEVER spends more than $3.17.

4. At the 2014 Berkshire Hathaway annual shareholder meeting, Buffett dropped some wisdom about his life and his frugality. Why is he so cheap? He explained it like this and you might want to send this to your friend, wife, or children: 
"There are things money can't buy. I don't think standard of living equates with cost of living beyond a certain point. Good housing, good health, good food, good transport. There's a point you start getting inverse correlation between wealth and quality of life. My life couldn't be happier. In fact, it'd be worse if I had six or eight houses. So, I have everything I need to have, and I don't need any more because it doesn't make a difference after a point. When you get to 10 times or 100 times or 1,000 times, it doesn't make a difference in quality of life." - Warren Buffett

Want to read or watch more? Here some sources to check out

- Warren Buffett's HBO Documentary About His Life
- How Buffett Once Bought Bill Gates Breakfast with Coupons
- Warren Buffett's Quote About Being Cheap