Berkshire Hathaway 1999 Annual Meeting Audience Question # 19

The difference between being rich and being wealthy

Warren Buffett:

Zone 6.

Audience Member:

Good morning, Mr. Buffett and Mr. Munger. My name is Jane Bell from Des Moines, Iowa.

In response to an earlier question, you spoke of people being rich and very, very rich.

It seems to me there’s a difference between being rich and being wealthy. I assume you consider yourself to be both. Which is the more important to you?

Warren Buffett:

Well, I think we may ask you to define. I don’t want to sound like President Clinton here, too much, but we may ask you…

I might want… if you’d really define the “rich” and “wealthy,” so that I get the distinction, then I think we can give you a better answer on it.

Audience Member:

Well, in my mind, being rich is having an awful lot of money. Being very, very rich is having even more. And being wealthy doesn’t necessarily equate to having a lot of money.

Warren Buffett:

What does it equate to, then? I just want…

I think I know what you mean. But I still want you to clear it up before I give you an answer on it.

Audience Member:

Well, this, of course, is my opinion.

Warren Buffett:

I mean, you could be wealthy in health, for example. And I agree with you, that certainly, there’d be nothing you’d value more than good health for you, you know, yourself and your family. But I… you go ahead.

Audience Member:

Well, I believe you’re starting to get it.

Warren Buffett:

Have patience.

No, there’s no question about it. I mean, being… the money makes very little difference after a moderate level. I tell this to college students that I talk to.

I mean, they are basically living about the same life I’m living.

You know, we eat the same foods. I mean, that I can guarantee you.

And, you know, there’s no important difference in our dress. There’s no important difference at all in the car we drive. There’s no difference in the television set that we sit there and, you know, watch the Super Bowl on or anything of the sort.

There’s really no difference in… you know, they’ve got air-conditioning in summer. And I got air-conditioning and I got heat in winter. Almost everything of any importance in daily life, we equate on.

The one thing I do is I travel a lot better than they do, you know, NetJets.

So the travel is… travel I do a lot easier than they do.

Everything else in their lives, it just… you know, I’ll switch places any time. It doesn’t make any difference.

So, the… then you get down to the things of health and who loves you. I mean, that’s… you know, there’s nothing… if you have a minimum level of… I mean, you want to have enough so that you eat three times a day, and that you sleep in reasonably comfortable surroundings, and so on.

But everybody in this room has that. And yet, some of the people, by the definition that you’ve given, are obviously much more wealthy than others. And it’s not measured by their net worth, if you define it that way.

I don’t disagree with that definition. I might not use the term, wealth, in describing it. But I’d certainly maybe call it well-being or something of the sort.

Charlie?

He’s thinking.

Charlie Munger:

Sure, there are a lot of things in life way more important than wealth. All that said, some people do get confused. I play golf with a man. He says, “What good is health? You can’t buy money with it.”

Warren Buffett:

Did I ever tell you about Charlie’s twin brother that he golfs a lot with?

No, I’ll take health any time, incidentally.

Charlie Munger:

So will I.

Warren Buffett:

The important thing, even in your work, I mean, is… to an extreme extent, it seems to me, is who you do it with.

I mean, it… you can have… if you’re going to spend eight hours a day working, the most important isn’t how much money you make, it’s how you feel during those eight hours, in terms of the people you’re interacting with, and how interesting what you’re doing is, and all of that.

Well, you know, I consider myself incredibly lucky in that respect. I can’t think of anything I’d rather do. And I can’t think of any group of people I’d rather do it with.

And if you asked me to trade away a very significant percentage of my net worth, either for some extra years in life, or being able to do, during those years, what I want to do, you know, I’d do it in a second.

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