Charlie Munger Quotes

I remember very vividly - I wrote about it in one of my books - my first IRA. I contributed $2,000 every year, and in 21 years, the funds in that IRA account grew to $260,000. Seems like sort of a miracle, but it happened.

Enjoy the magic of compounding returns. Even modest investments made in one's early 20s are likely to grow to staggering amounts over the course of an investment lifetime.

Albert Einstein is reported to have said compounding is the eighth wonder of the world. Obviously, a dollar invested in your 20s is worth so much more than a dollar invested in your 60s.

A penny here, and a dollar there, placed at interest, goes on accumulating, and in this way the desired result is attained.

Index investing outperforms active management year after year.

The longer you hold a dollar, the longer you hold money, the more valuable it becomes over time. So the younger you are, the more ability you have to hold money longer term.

Money you won't need to use for at least seven years is money for investing. The goal here is to have your account grow over time to help you finance a distant goal, such as building a retirement fund. Since your goal is in the future, money for investing belongs in stocks.

I almost always recommend investors get fully invested, since it's better to put your money to work than to let it simply track the rate of inflation.

I'm a big believer in investing for the long term, and the decisions you make shouldn't be made if the economy is good or bad at a specific time.

We don't worry over macro-economic factors when investing, as we are always thinking about the long-term.

We talk about long-term patient investing, and that idea that slow and steady does win the race, that time can be your best friend when it comes to investing. That's why we have a turtle as a logo at Ariel.

I think average investors should not trade a lot. The evidence is overpowering. The more you trade, the less you earn.

Invest as efficiently as you can, using low-cost funds that can be bought and held for a lifetime.

Most great fortunes are built slowly. They are based on the principle of compound interest, what Albert Einstein called, "The greatest power in the universe."

The typical big winner in the Lynch portfolio generally takes three to ten years to play out.

Investors that do the best, and have done the best, are those that stay and compound at above-average rates over the long term.

Time is your friend, impulse is your enemy. Take advantage of compound interest and don't be captivated by the siren song of the market.

If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes. Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio's market value.

The best way in my view is to just buy a low-cost index fund and keep buying it regularly over time, because you'll be buying into a wonderful industry, which in effect is all of American industry... People ought to sit back and relax and keep accumulating over time.

No one knows what stocks will do tomorrow, but the evidence is clear as to how they'll perform over 10 or 20 years. They will almost certainly go up.

If a woman is making $85,000 a year, putting aside 20% of her income, putting it in a bank, earning very little...Over the course of her life vs. investing, this can cost her $1.5 million, $2 million, $2.5 million. Life changing amounts.

I have no views as to where it will be, but the one thing I can tell you is it won't do anything between now and then except look at you. Whereas, you know, Coca-Cola (KO) will be making money, and I think Wells Fargo (WFC) will be making a lot of money and there will be a lot - and it's a lot - it's a lot better to have a goose that keeps laying eggs than a goose that just sits there and eats insurance and storage and a few things like that.

While it is probably a poor idea to own actively managed funds in general, it is truly a terrible idea to own them in taxable accounts... taxes are a drag on performance of up to 4 percentage points each year... many index funds allow your capital gains to grow largely undisturbed until you sell... For the taxable investor, indexing means never having to say you're sorry.

You know the rule of 72, divide the number into 72, any number you want, and that's how long it will take your money to double.

Finding a single investment that will return 20% per year for 40 years tends to happen only in dreamland. In the real world, you uncover an opportunity, and then you compare other opportunities with that. And you only invest in the most attractive opportunities. That's your opportunity cost. That's what you learn in freshman economics. The game hasn't changed at all. That's why Modern Portfolio Theory is so asinine.