One of the core themes of our firm is to educate. It's the reason that we do this show. We're going to talk about the Berkshire Hathaway annual meeting. I know you attended that and it really is an indication of what you guys are doing in terms of the continuing education and the fact that you guys are continuous learners.
Bill, why don't you start out and tell us a little bit about what is the philosophy of you and your firm in terms of this idea of just continuous learning. I believe that there's no way that you would at some point in life be done learning. I make it a real point to put myself and our firm around what I would consider some of the best in the world at what we're trying to accomplish for our clients. This weekend Matt got to go up to Omaha for the Warren Buffett's meeting.
You and I were actually in Newport at a conference very similar to this as well. We were across the country if you will, but we were trying to be continuous learners as well as at our think tank group there in Newport. Bill, I grew up born and raised in Omaha, so I'm a dancer there and obviously have fond memories of Omaha. Newport Beach, that's kind of nice too.
That's tenure. It was not too bad, but Steve, it was a little chilly for me. They all knew out there that I'd must be not a West Coast guy because I show up with my shorts and short-sleeved shirts and it was 55 degrees. No complaints.
No, no, we had a great conference out there. Very nice event and definitely hanging around with some other really successful people. I just love the fact that you guys are just all about continuous learning and knowing that we don't all have the answers that we want to continue to learn. So how does that translate to your clients, Bill?
How do your clients benefit from that? Well, first I just want to honor our listeners for taking the time to also be learners or they wouldn't be listening to this podcast right now. And one of the core themes of our firm is to educate. It's the reason that we do this show and I believe that for folks to be successful, they need to be educated and engaged in the processes.
Now, they hire advisors so that they don't have to rethink this type of thing each and every day, but I still believe that they need to be educated and engaged. Come to the table at least a couple of times a year and then do things like listen to podcasts, go to seminars, go to events, learn the language, learn what's going on out there to be informed investors. So again, honoring the people that are taking the time to listen to our show. And I might say they're greatly increasing their odds of success by being engaged.
So many people this day and age, especially when you're working, they're on autopilot in their investments and their retirement planning. It's not until we've talked about in prior episodes, not until just a few years out that folks start to realize that, wow, at some point the paycheck's going to stop and I'm going to have to navigate making my money last the rest of my life. And I'll tell you, engagement and education and always looking to learn is a huge part of it. Hopefully we're doing that as even our podcast here.
I hope so. Yeah, I definitely think we are. And I think you made a good point there in that. It's not with these podcasts that we are trying to turn the listeners into financial advisors themselves.
And clearly the people that are working with you are saying, hey, I don't want to be an expert in all this stuff. That's why I'm hiring you. I want you to take care of this. I want you to worry about this for me.
And that's exactly what you folks do there at Kean Wealth Advisors. But like I said, it is important for clients to have an understanding of what's going on and feel comfortable and confident in their financial decisions that they're making. And I firmly believe that an educated client makes a better client as well. And this is kind of a cooperative type of relationship in that the clients need to understand what's going on and not just completely abdicate everything.
So I think it's all good. Yeah, we're going to do an episode coming up on how I believe folks should go about selecting a financial advisor. But one of the points that I'll make and I'll make it now is I always say education. And some folks say, what do you mean by that?
The advisor's education? Well, yes, sir. I do mean the advisor's education. I mean, in one sense, I have a tax advisor and I have a legal advisor.
And I'll tell you, I want those advisors, my physician. We could go there. I want them to be educated, sure. But I don't want them to just have the lowest level of education that they need to keep their licenses in place.
I want them to be also out at conferences and think tank groups. I want them out places learning and evolving and thinking outside the box. But on the other hand, I want them to educate me on the things I should be thinking about and understanding about so that my wife and I, my family can make educated decisions along with and partnering with my advisors. So I'll tell you what, that education will go in both ways, makes a big difference.
And I might add one more thing. Steve, do you think peer groups are important? Oh, for sure. Do you think it makes a difference that the people you hang around with, that you will rise or fall to those folks and whatever the Deaver might be?
Well, I do. And I think it was Jim Rohn who said something like, you are the average of the five people you hang around with the most. That's right. And you know what you told me, I believe on a prior episode that if you're the smartest guy in the room, you better find another room.
Exactly. I didn't originate that idea. But I do believe it. With all that in mind, that's why I was in Newport, our group that weekend.
And I know that's why you were there at Tuesday. It's an honor to be involved in that community of like-minded thinkers. But in the same light, that's why Matt here, who's a managing director of King Wealth and 15 years here at the firm and a wealth advisor, CFP, very, very solid gentleman dedicated to the business, a continuous learner committed to going to Omaha, driving up from Kansas City, Saturday morning, and attending the Berkshire Athweight Annual Meeting. So before I have you go into that with him, can I tell a story on him real quick?
Of course. So Matt and I and Pastor Philip, a friend of ours and Pastor are in an accountability group. So the first of the year we made a commitment to each other that we would get up every day and we would do our devotional reading and that we would do our exercise. And that we would text each other on a three-way group text confirming that what we had done.
So we would hold each other accountable. Just that alone, it's been a great little accountability exercise and it's been very productive. It's amazing what happens if you take care of yourself spiritually and physically, consistently. But Saturday morning of the Warren Buffett meeting, I just found this out.
Matt decided he didn't want to fall short on his commitment to us. So he awoke at 3 a.m. went out and got his how many miles? I ran for an hour or so.
All right. Six to seven miles? Yeah, for him, you know, it's probably much longer than me running for an hour. But he runs six to seven miles, goes home, takes a shower, gets to Omaha and time to get a good seat before the eight o'clock meeting started.
So there's a fellow who's pretty committed. Well, you guys were hanging out in Newport Beach that morning. It poured. So it was raining while I was running and then of course on the two and a half hour drive from Kansas City to Omaha, it poured the entire way.
But it was worth it, right? It was worth it. That's right. I had fun the entire time.
So tell us about you at the Berkshire Hathaway annual meeting. Was this your first time? It was. Warren is 85 years young and his partner, Charlie, is 92.
So not sure how much longer they're going to be around, but I figured this is an experience and something that's close enough to Kansas City that I need to take advantage of. So I drove up there just that Saturday morning left at 5 a.m. got up there about 730 and it's up in Omaha, Nebraska at the is it the Century Link? Is that what it's called?
Now, Steve? Yeah, Century Link. Yeah. Just similar to the Sprint Center here in Kansas City and they had 40,000 people this meeting, just buffet and monger answering questions for, gosh, I think it was six or seven hours on that Saturday.
And it looks like they asked a wide variety of questions, not just financial questions, but live questions. And so what were some of the questions that people were asking that you thought were pretty interesting? Yeah. One of the first questions was about Warren's age in Charlie's and about why they're still doing this and what makes them happen.
That was one of the very first questions that was asked. And I thought, you know, these are two guys that are very successful. They've been very consistent, I think, too, throughout their careers in terms of their thought process and their recommendations. And so their older gentlemen with a lot of wisdom.
So I thought, hey, this is a great way to kick off that meeting and buffet at 85. He's as happy as he could be. And he gets to do what he loves doing every day. He eats what he wants.
And he works with people that he wants to work with. And he realized at an early age that he has to be his own boss. He also said that Charlie at 92, he still does something fascinating and rewarding and socially productive as any period in his life and enjoys the partnership. And then Charlie chimed in and he said, you know, one of the things people ask him all the time is does he regret anything?
And he said he doesn't regret making more money, but he regrets not rising up as fast as he could have. But he said one of the blessings that he has at 92 is that he has a lot of ignorance to work on. Well, so I mean, definitely very humble and still long-term outlooks for the rest of their lives. Well, you know, what's interesting here, you got 85 and 92 and these guys are still working hard.
Yet I don't think either of them would say they're quote working because they're doing what they love. And Bill, you know, we've done podcasts in the past where we're talking about happiness in retirement and what does retirement mean and the kind of the changing nature of retirement. So I think these are a couple of interesting guys who are outside of, I mean, they're older than the baby boom generation. Yet here they are.
They're still working doing what they love. You know, maybe the key is that you don't have to work in retirement, but you really need to be doing something that gives you enjoyment, pleasure, meaning satisfaction, and ideally some type of social relationships and using your brain to do something. So you feel like you got a reason to get up in the morning. That's right.
And as we've talked in the past, you've said, I think Steve, don't just retire from something, but retire to something. And these gentlemen, like you say, they don't look at this as work and it certainly isn't for the money. We know that for a fact. They're not getting up and doing this work for the money at this point in their lives.
Right. Alright. Matt, what else? What are some other interesting things they talked about?
You know, that actually kind of segues into, he had a question about Coca-Cola as many people that, you know, familiar with Warren Buffett, he's a big fan of Coca-Cola drinks a lot of it. He's also a large shareholder. And the question was interesting because, you know, he has in the past spoken about tobacco companies and why, you know, he's not a big fan. He's not a big fan of tobacco companies and why he wouldn't invest in them from a moral or ethical standpoint, just because of the product that they sell.
He said it's a phenomenal business. They have a product that is very inexpensive to make and they make a nice margin on it and it's addictive, but he wouldn't invest in it for those moral and ethical reasons. Well, the question then kind of said, you know, considering that Coca-Cola has come under a lot of scrutiny and probably the sugar industry in general about how that can be addictive and childhood obesity, kind of the issues with that. So has his stance on Coca-Cola changed?
His response was that he drinks 700 calories of Coca-Cola a day. And he said it's a choice that he makes that to consume a quarter of his calories from Coke. He said the issue is, and you know, of course he's not a nutritionist or dietitian or anything. He said the issue is a choice of calories and overconsumption.
He said the issue is not that the product's bad, but the consumption of too much is what's causing, you know, these epidemics from the obesity standpoint. So he doesn't think 700 calories a day of Coke is too much? Can we do a disclaimer on that, Steve? That's not a suggestion of keen wealth advisor, is that possible?
Well, Matt was sharing with me that the entire day they sat up there on stage and drank Coke and ate peanut brittle from which one of their conglomerates? Cscan, Cscan. Yeah. So they're sitting on the stage and they had a camera crew with some live feeds with some projections and you would just see them.
They would just pour Coke after Coke and be munching on this peanut brittle. The entire meeting, he said, when it comes to health and longevity, he said he truly believes being happy is one of the key components to longevity. And he said, I wish I had a twin brother who all he did was eat broccoli and did everything healthy for his entire life. And I bet you, I would live longer because he would be miserable, living that lifetime.
Right. Well, you know, what's interesting about that is I think there is a lot of truth to that, but I think research shows that maybe upwards of 40% of your longevity is going to be due just to your genes, just what you're born with, that you can't really change it. Maybe the other 60% or so are things that you can actually affect. But if you look at just like comedians, Bob Hope, Jack Benny, I mean, some of those guys, man, they lived a long time because they're just laughing 24 hours a day.
That's right. Yeah. Totally agree. All right.
What are some other things? Did they talk business at all? So they got several questions on just specific segments of their businesses. You know, they are a holding company and they own many companies outright where one of the recent acquisitions was Precision Cast Parts, which is an engine manufacturer in the airline industry.
And you know, they got questions around that around the railroad. They bought Burlington Northern a few years ago. And just what's happening in the energy field and with the railroads, one question they had was about energy and oil prices in general and what their outlook was. And Warren basically said they have no clue what's going to happen to oil prices and they don't even want to make a guess.
They just focus on businesses that they believe are run well and have their economic moat, so to speak, where they have their specific strategy that they can execute on and not worry about commodity prices. And then Warren, he'll answer the question and then he'll ask Charlie if he has any comments to make or any additional follow up. And on that question, he asked Charlie if he had anything to say. And Charlie's response to this one was that he's even more ignorant than Warren is on the direction of oil prices.
Yeah, I've even heard Buffett say in the past that if the chairman of the Federal Reserve whispered in his ear what they were going to do with interest rates, whether they're moving them up or moving them down, Buffett said it would make no difference whatsoever in his investment plan. Now isn't that interesting to hear one of the wealthiest men on the planet? And it's not that we're enamored by the wealth. It's just you cannot argue with the man's success.
He's been successful in his investments consistently for a long time. And that's why we study what he does. I believe that we're always open for new ideas and learning, but I also believe you don't have to reinvent the wheel that you can watch what the most successful people in the world are doing. And you can emulate that or learn from that.
So the idea that he's not jumping around changing his philosophy for anything that's temporary out there or the headline of the day is it's a reiteration of what we've said many times over our podcast here, Steve, but I think it's great to bring that point up. Yeah, well, it gets right back to the podcast we did on separating the news from the noise. That's right. That's exactly right.
And it's the human tendency to want to respond to react. What do we do about what's happening today and whatever's happening today, not to downplay the seriousness of some of the things that are happening, but just wait six months. Strong possibility that most of it you won't even remember what it was. It'll be the new headline of the day.
And it's always nice to have that reconfered by someone who's been very, very successful at doing what they're doing. And Bill, you just gave me an opening here. I hope you're ready. Oh, no, Steve.
I thought we talked offline about no more of these trying to trip me up here. Well, you gave me an opening here when you talked about Buffett and how he's been successful for so many years. So I just happen to have some statistics at my fingertips here. I have somebody here with me.
I don't even need to phone. So he's right here with me in the studio. Can Matt help me? That's the question I do now.
Yes, you can. Yeah, for sure. All right. Thank you.
It's two against one here. Excellent. I'm the house because I've got the answer. All right.
So let's have a little fun with Mr. Buffett here. So we know he's worth billions of dollars, but let's look at what was his net worth at various ages. So how old was he when he first became a millionaire when he had his $1 million net worth?
How old was he millionaire? So so he's 85 now. He's born in what? Was it born in 30?
1930. Yeah. Okay. Do you want me to answer Matt?
Can we each of us answer or we have to come up with the right answer first and confer? No, no, you can each give me that. I'm thinking it's 27 years old. Yeah, I was going to say 25.
You're close. 30. All right. Okay.
And that would have been back in 1960. Yeah. Like 1960. Yeah.
All right. Well played. Okay. So good.
Good there. This is when he became a millionaire. How about when he became a billionaire? How old was he when he became a billionaire?
All right. So it's just one letter different, but it's quite a chasm. It's a few more zeros. That's right.
Matthew, you want to go first? You know, my thought, the number that pops into my head is 57. I was going to say 60. I think there was quite a time there that it took him to make that.
You guys are rocking it today. 56. Really? All right.
Wow. Very nice. Just read on. Okay.
Okay. I'll get you next time. All right. So here's what I think is an important learning here.
So it took him from age 30 to age 56. He went from 1 million to 1 billion. And then from 56 to age 85, he went from 1 billion to approximately 66 billion. So the vast, vast majority of his wealth has come in the past 30 years.
And I'm not sure that people really understand that. And that's the power of compounding. And the power of long-term investing. And I think that's just an important point for all of our listeners that.
And that's again, one reason why he's been so successful is he's separated the news from the noise. And he's always been thinking long term. And I know that financial advisors always talk about, hey, we got to think about long term. Don't worry about this, you know, 5 or 10 or 20% drop in the market.
Not one that just happened, but I'm just saying over time, we know markets go down and we tend to get a little bit nervous about that. But if we take that long term perspective and understand that these things have a way of working themselves out in our country that that should help put our minds to ease a bit. That's right. And think about all the things in the last 65 years.
We've had wars, we've had terrorist attacks, tsunamis, market crashes, financial crises, multiple, so many things that you can't even really recall. And he stayed true to his discipline. You know, Steve, I wanted to make sure I shared this today because you and I did a blog post recently. A few weeks ago, we mentioned Warren Buffett and we also noted Sir John Templeton in that blog post.
It was a great post. I would recommend people go back to look at that kind of a perspective on the history of the markets. But I had a couple people say, you know, we can't really relate to that because you're talking about multi multi billionaires. And here we are.
We're normal people. We've worked 40 years or so. We're retired. We have a million or a few million dollars or so.
And we can't relate to the billionaire story. But I just want to take a step back and say the disciplines that are in play for quote normal people that we work with and potentially listeners to our program here are the same. It's invest money. Make sure you have enough outside the market outside of volatile accounts.
So the money that you need to live on isn't subject to volatility in the short term. And make sure you're allocated correctly for whatever might come up enough growth to provide what you need down the road and that of inflation and really just be aware of that and have a plan and actually use volatility as your friend over time. You know, and you're never going to hit it exactly right time. Why is Warren Buffett back in the financial crisis made to major investments?
Was it Matt was a G and Goldman Sachs, right? G and Goldman Sachs. Yeah. Steve, I also think he didn't do a little bail out with Bank of America to didn't warn him.
I think Warren's or options. He said he still has. Yeah. He mentioned that meeting that he's been converted to shares.
Yeah. So here's my point and I'll turn it back to Matt here. But my point is even Warren Buffett. Didn't get the timing exactly right when he stepped in and helped Goldman and GE for sure.
I know of that was in what November. Oh, wait. It was November. Yeah.
Yeah. And the market didn't bottom until March of 2009. So in his investments, everything remounted. He's made a ton of money on those investments, but he didn't hit the bottom either.
He did not. So it's not that we're trying to say that there's some magic out there of timing-wise or even the smartest people on the planet, but it's just the fact you have a discipline and you look at things from a different view. It's all perspective, execution and understanding. Well, and I think you made a good point there, Bill.
As far as when we talk about someone like a Warren Buffett or John Templeton and these guys are billionaire investors, it's not that we want our listeners to be focused on. The money or the amount of money that people make. It's as you say, it's the principles behind what these people do. It's the long-term view that they take.
It's about buying things when we see value and it's about the disciplines that these people have and everything is relative. And so for your clients, it's not that we're trying to make a billionaire, it's that we want to share with them some of the principles that underlie the most successful people and help use some of those same principles, but just on a different scale. So yeah, so with that, Matt, any final learning from the event that you want to share here as we get ready to wrap up? You'll get several questions from the crowd that I thought were very interested.
You had one on just the election that's coming up in his take on that. It doesn't matter who's going to be president, Berkshire will do fine. He said, we've had 52% tax rates here in the US in corporate businesses in the past and we've gotten through that. We've had price controls, we've had regulations and over the last 200 years, American businesses thrived in prospered, despite all that.
And it's because business adapts to society and society has adapted to business. They both have changed as the environment has changed. And he said the US is just a phenomenal place to run a business and you have just the output of American business over his life. He said it's increased six to one over his 85 years that he's been alive.
And then over the next 50 years that the output and quality will continue to increase and we will have just so much better standard of living that we have right now. And no president can change any of that. And he said, no one wishes that they were born 50 years earlier if they have the same talents that they have right now. So you'll never find anyone who just wishes the good old days were true, you know, if they really think about it.
And he said, just look back 20 years and things are just so much different and business has to be able to adapt to that and it has. And then he left that last comment. He said, but I'm still sticking with the landline. And a rotary dial too, probably.
That's right. So he's hanging on to some of the good old days. Yeah, that's awesome. You know, you just have to be optimistic, not stupidly, blindly optimistic, but you just have to believe in a brighter future.
And we all know there are bad times that happen. But over the longer term, things do have a way of working out in as humans, particularly here in the United States and the type of society that we have in the government that we have, we do have a way of working things out and figure things out. So, hey, Bill, why don't we wrap up with you? What are the final closing comments for the show today?
No, I just want to thank Matt for taking the time to report back to us on his trip up to Omaha. He took copious notes and Steve, I might not know if I told you this, but he did run into a billionaire. Is it Bill Ackman? Bill Ackman?
Yeah, in a bookstore, got a photo with him. He's a fellow, Steve. I'm sure you know our listeners. He's regularly seen on CNBC harassing Carl Icahn back and forth.
Matt got a picture with him, got a chat with him for a moment. So that was also fun. But just real grateful to have our show today. Have both of you gentlemen on here on the podcast.
And I might just say one last thing. I would recommend that if anyone wants to further learn about the way Warren Buffett thinks that all of his annual reports are out there online. They're free. They are.
No cost to review his reports and to just get inside his head a little bit in his words and to see the evolution of his life and his career. Yeah. And we'll put a link to that in the show notes page as well. So people get to the blog post that we put together for each episode and just click right on the link and I'll take you directly to all of the shareholder reports on the Berkshire Hathaway website.
So guys, great. Hey, as always guys, always fun to be talking to you here and sharing some good words that we can help communicate and educate our clients and potential clients out there. So thanks again, guys. Appreciate it.
You best, Steve. Always a pleasure. Thank you, Matt. Thank you for having me.
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