Warren Buffett became a millionaire at 32. What he advises youth trying to copy his success

Warren Buffett became a millionaire for the first time at the age of 32. While the legendary investor’s market acumen and talent deserve credit, Buffett has laid out a guide for the younger generation aiming to emulate him.

Back in 1999, an investor asked Buffett what he would have done differently if he had to start out again in his early 30s. “In short, Mr. Buffett, how can I make $30 billion,” he asked as the crowd laughed. But Buffett had a tactful reply. “Start young.”

Warren Buffett started investing at a very young age, buying his first stock at age 11. He bought shares of natural gas company Cities Service for $38 apiece in 1942, just after Japanese air forces attacked the US Pacific Fleet at Pearl Harbor, amid the raging World War II.

Warren Buffett and the 'snowball' effect

The legendary investor has used the metaphor of ‘snowball’ to refer to the importance of compounding over time. "Charlie's always said that the big thing about it is we started building this little snowball on top of a very long hill," Buffett said. "The nature of compound interest is that it behaves like a snowball of sticky snow."

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The trick according to Buffett is to have a very long hill, which means either starting very young or living to be very old. The market veteran said his ‘Snowball’ metaphor refers not only to compounding money, but also the world and what kind of friends one accumulates. “The snowball just happens if you are in the right kind of snow, and that’s what happened with me…You have got to be your own wet snow, in effect. You would better be picking up snow as you go along, because you are not going to be getting back up to the top of the hill again. That’s the way life works,” he said.

“Figure out what your strengths are and then pick the right people and don’t be afraid of making mistakes,” the legendary investor told CBS News. He recently stepped down as the Chairman of Berkshire Hathaway, passing the baton to his son Howard Buffett after spending more than half a century in the role and transforming a struggling textile business into a more than $1 trillion enterprise. In his letter to Berkshire’s shareholders, the legendary market investor recalled celebrating his 96th birthday in August this year and recognizing that it was time to move on. "Father Time always wins," he reflected.

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Buffett said he still has the best job in the world after having served sixty-plus years in Berkshire since 1965. “That is not something many people my age can say, and I have never felt better about what comes next,” he wrote. “Serving as your Chairman has been the privilege of a lifetime, and I have never taken your trust for granted. Father Time always wins. He has, however, been generous with me. He has given me the opportunity to see Berkshire reach a point where I am more confident than ever about what lies ahead. The company is in excellent hands, and I look forward to remaining a shareholder alongside you,” he added.

(With inputs from agencies)

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