That bank visit was a bookend in Buffett’s life, a fittingly financial signal event in the life story of the man widely regarded as the world’s greatest investor. He told Fortune at the time that it reminded him of a visit to that same bank, then called Omaha National, almost 70 years earlier, an event that in retrospect seems the other bookend in Buffett’s financial life. He was 6 years old. His father set up a savings account for him and put $20 in it.
Thus the obvious questions that have transfixed investors for decades: How did Buffett grow $20 to well over $200 billion? Why weren’t others able to do it? How did he find the secret? What is the secret?
He believed them intensely, but they aren’t the key to his success. The key is, he never stopped seeking the key. When asked to explain his success, he often said it was simply that he was “rational.” It sounds so easy. But rational people change their beliefs when reality dictates, and most of us find doing so excruciatingly hard.
He even made irrational, emotional decisions. At age 11, in 1942, he bought his first stock: three shares of Cities Service Preferred for himself and three shares for his sister Doris. (Cities Service was the oil and gas company now known as Citgo.) The price quickly dropped. When it finally recovered and rose just above the price he had paid, he sold—and the price kept rising, soon quintupling. He never forgot that he should ignore the price he had paid, which he couldn’t change, and focus only on the company’s future. He learned also that if he was going to invest someone else’s money, he had better be highly confident he could do it well. His biographer, Alice Schroeder, wrote that Buffett “would call this episode one of the most important of his life.”
Most people find it excruciatingly hard to change their beliefs when reality dictates. Buffett could do it.
He never stopped challenging his beliefs. He saw the dotcom bubble of the late 1990s for what it was and said so. He wouldn’t invest in internet stocks, he explained, because they were impossible to value. Silicon Valley cheerleaders shook their heads smugly, lamenting that old Warren had let the tech revolution pass him by.
That’s what brought him to his safe-deposit box in downtown Omaha, by himself, removing a piece of paper worth $11 billion. He would soon send it to the Gates Foundation. We cannot know his emotions at that moment, as he said goodbye to a significant portion of his life’s work, but it’s difficult to believe that he swallowed hard or trembled. More likely he was smiling.
Giving up “cigar butts”
Buffett began his career as a disciple of Benjamin Graham, who recommended buying stocks only at rock-bottom prices. But Buffett’s business partner, Charlie Munger, convinced him that some strong companies were worth buying even when they weren’t bargains— paving the way for some of Buffett’s best investments.
Catching up on tech
Even as he built a peerless track record, Buffett avoided investing in tech companies, arguing that their future value was impossible to estimate. But he eventually came to recognize Apple, under CEO Tim Cook, as a traditionally great business with a huge competitive “moat.” It became one of Berkshire Hathaway’s top-performing holdings.
Giving to the better giver
Buffett had long planned to give away most of his wealth after his death. But the accomplishments of the Bill & Melinda Gates Foundation changed his mind—and attracted some $40 billion of his money. As he told Fortune, “What can be more logical, in whatever you want done, than finding someone better equipped than you are to do it?”
This article appears in the June/July 2025 issue of Fortune with the headline “Warren Buffett’s secret to success: He knew how to change his mind.”
