Warren Buffett: Cash is Oxygen

Meaning of Warren Buffett Money Quote: saying cash to a business is as essential as the air to breathe – when unavailable, business gasps. Warren Buffett said:

 

 

“Cash, though, is to a business as oxygen is to an individual: never thought about when it is present, the only thing in mind when it is absent” — Warren Buffett

Warren Buffett compared cash to oxygen for a business to emphasize how important cash is for a company’s survival and operations. Just as humans need oxygen to breathe, businesses need cash to pay expenses, purchase supplies and materials, meet payroll, and cover other costs needed to operate on a day-to-day basis.

Without sufficient cash reserves, a business risks running into financial difficulties and potentially failing if it is unable to pay its bills. Buffett’s quote aims to highlight that cash, though often overlooked when plentiful, becomes the primary concern when reserves run low.

Warren Buffett: Cash Legal Tender

Meaning of Warren Buffett Money Quote: saying when it comes to paying bills, only cash is accepted. Warren Buffett said:
 
 

 

“When bills come due, only cash is legal tender. Don’t leave home without it” — Warren Buffett

Warren Buffett compared cash to oxygen for a business to emphasize how important cash is for a company’s survival and operations. Just as humans need oxygen to breathe, businesses need cash to pay expenses, purchase supplies and materials, meet payroll, and cover other costs needed to operate on a day-to-day basis

. Without sufficient cash reserves, a business risks running into financial difficulties and potentially failing if it is unable to pay its bills. Buffett’s quote aims to highlight that cash, though often overlooked when plentiful, becomes the primary concern when reserves run low.

Warren Buffett: Paying Income Tax

Meaning of Warren Buffett Money Quote: saying those paying taxes are not taxed on capital gains, dividends. Warren Buffett said:
 

 

“We’re paying maybe 25 percent of the income tax, but the payroll tax is over a third of the receipts of the federal government. And they don’t take that from me on capital gains. They don’t take that from me on dividends” — Warren Buffett

Warren Buffett is referring to how capital gains and dividends are taxed at lower rates than regular income for most taxpayers. When someone sells an investment like stocks or real estate for more than they paid, the profit or “capital gain” is taxed. However, the capital gains tax rate is typically lower than the rate for ordinary income.

Dividends from stock investments are also usually taxed at a lower rate than regular wages or self-employment income. By pointing this out, Buffett is suggesting that the tax system favors investment income over earned income through work.

Warren Buffett: Reputation Ruthless

Warren Buffett Money Quote saying that protecting the reputation of the company matters more than short-term profit. Warren Buffett said:
 

“Lose money for the firm, and I will be understanding. Lose a shred of reputation for the firm, and I will be ruthless” — Warren Buffett

Warren Buffett is saying that protecting the reputation of his company, Berkshire Hathaway, is more important to him than short-term profits. While he will understand if the company loses money sometimes due to risks in business, he will be ruthless if anyone damages the company’s reputation in any way.

The quote suggests that Buffett values maintaining Berkshire Hathaway’s strong reputation for integrity above all else, even making money, as reputation is key to the long-term success and trust placed in the company by its shareholders and customers.

Warren Buffett: Teaching Kids Value

Warren Buffett Money Quote saying kids should be taught the value of saving and meaning of needs versus wanting things. Warren Buffett said:
 

 

“It’s never too early. Whether it’s teaching kids the value of a dollar, the difference between needs and wants, or the value of saving. These are all concepts that kids encounter at a very early age, so best to help them to understand it” — Warren Buffett

Warren Buffett thinks it’s important to teach kids about needs vs wants at a young age because developing good financial habits early can benefit them for life. By distinguishing between things they need to survive versus things they simply want, kids start to understand the value and scarcity of money. This helps them avoid impulse spending and overspending.

It also encourages saving habits so kids learn that delaying gratification can help them afford bigger needs and wants later. Overall, learning this lesson young instills principles of financial responsibility that serve people well as they get older and gain more independence over their money.

Warren Buffett: Kids Manage Money

Warren Buffett Money Quote saying people wait until children are too old to begin teaching them financial literacy. Warren Buffett said:
 

 

“Sometimes parents wait until their kids are in their teens before they start talking about managing money — when they could be starting when their kids are in preschool” — Warren Buffett

Warren Buffett is suggesting that parents should teach their children about managing money at a younger age, starting in preschool rather than waiting until their teens. He believes it’s better for kids to learn financial literacy and responsibility from an early age.

By starting these lessons when kids are young, it gives them more time to learn good money habits and make mistakes with smaller amounts before handling larger sums of money as teenagers. The quote encourages parents not to delay teaching children about earning, saving, and properly managing their finances.

Warren Buffett: Trickle-Down Rest

Warren Buffett Money Quote saying the wealthy want more money so that when they spend it, it will run downhill to the rest of us. Warren Buffett said:
 

 

“The rich are always going to say that, you know, just give us more money and we’ll go out and spend more and then it will all trickle down to the rest of you. But that has not worked the last 10 years, and I hope the American public is catching on” — Warren Buffett

Warren Buffett is skeptical of trickle-down economics. This suggests that Warren Buffett does not believe tax cuts and other benefits for the wealthy necessarily help the broader economy or lower and middle classes, as proponents of trickle-down economics claim. He thinks the idea that money given to the rich will trickle down has not been borne out in recent decades.

Warren Buffett: Buy Farm for Years

Warren Buffett Money Quote saying short-term thinking doesn’t lead anyone to invest in long-term assets. Warren Buffett said:
 

 

“Nobody buys a farm based on whether they think it’s going to rain next year. They buy it because they think it’s a good investment over 10 or 20 years” — Warren Buffett

Warren Buffett is saying that when people invest in farms, they don’t do it based on whether they think it will rain the following year and help crop yields. Instead, they buy farms as a long-term investment because over many years, farms tend to appreciate in value or generate income from crops/livestock.

His point is that people shouldn’t take a short-term view when investing, but rather consider an investment’s potential over 10-20 years or more. By owning a farm for its long-term value, short-term weather fluctuations won’t sway the investor’s view of whether it was a good investment.