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When you think of the greatest investor, one face comes to mind. A boyish grin. Chipmunk cheeks. Thick-rimmed glasses. Cola in one hand. And a Dairy Queen burger in the other.

I’m talking about Warren Buffett - the Oracle of Omaha. The man who turned a small failing textile mill into a trillion-dollar empire.

But even legends have their final chapters. In May 2025, at age 94, Buffett announced he would step down as CEO at the end of the year, ending an incredible 60-year reign1. His retirement comes just 16 months after the passing of his best friend and Berkshire Hathaway’s vice chairman, Charlie Munger.

But Buffett’s rise wasn’t a straight line. It was a journey - bold moves, shrewd bets, and a relentless belief in finding value.

With that in mind, let’s look back at some of his greatest decisions, the lessons he learned, and the wisdom we can take from them.

Lessons from Ben Graham: Margin of Safety and Mr. Market

Warren Buffett’s investing philosophy stands on a foundation laid by his mentor, Benjamin Graham.

And of everything Graham taught him, two key concepts stuck with Buffett the most:

Margin of Safety: An Investment Cushion

Imagine buying a house worth $500,000 for just $350,000. That $150,000 difference is your Margin of Safety – a buffer against market downturns.

  • Buffett’s Example: In the 1970s, Buffett bought shares in the Washington Post when it was trading far below its intrinsic value. That discount was his Margin of Safety, and as the company grew, so did his investment – multiplying many times over.

Mr. Market: The Erratic Investor

We’ve written much more about this concept before (read here), but here’s the gist.

Picture having a business partner named Mr. Market, who offers to buy or sell your share of a business at wildly different prices every day. Some days, he’s euphoric and offers sky-high prices. Other days, he’s depressed and offers bargain prices. Your job? Ignore his mood swings and take advantage of his mistakes.

  • Buffett’s Example: During the 2008 financial crisis, Mr. Market was in full panic mode. Buffett saw that quality companies like Goldman Sachs were undervalued and made a lucrative investment, capitalizing on the fear.

These two concepts played powerful roles in Buffett’s success as an investor. And it’s this type of timeless wisdom we should never forget (even if the rest of the crowd does).

Now, let’s talk about the other major influence in Buffett’s life. . .

The Impact of Charlie Munger: Buffett’s Right-Hand Man

You can’t talk about Warren Buffett without mentioning Charlie Munger. They met in 1959, introduced by a mutual friend. Little did they know that dinner would spark a partnership lasting over 60 years.

Buffett started as a “cigar-butt” investor – buying dying companies with a few puffs of value left. But Munger changed everything. He taught Buffett the value of quality – that it’s better to own a wonderful company at a fair price than a mediocre one at a bargain.

Munger also introduced Buffett to mental models – a network of principles from multiple disciplines (like psychology, physics, economics, and biology). This broadened Buffett’s thinking, making him a sharper investor and a wiser thinker.

 

Buffett’s Key Axioms: Buying Fear, Selling Greed

Thanks to Graham’s teachings and Munger’s wisdom, Buffett became the greatest investor of all time.

And one of his most famous principles was to “be fearful when others are greedy, and greedy when others are fearful.”

This contrarian approach helped him profit from market downturns (such as 2008) while taking money off the table when markets got too greedy (such as during the dot-com bubble).

Buffett’s discipline in avoiding speculative bubbles, his focus on businesses he understands, and his insistence on buying companies with strong fundamentals have been central to his success.

Buffett Highlights: A Series of Bold Moves

Over these 60+ years of investing, Buffett has made some remarkable moves.

Here’s a list just touching on some and the key lessons we can learn from them. . .

  • 1963 - Buys American Express During the Great Salad Oil Scandal: In the wake of the Salad Oil Scandal4 - which threatened American Express’s survival - Buffett invested heavily in the company, recognizing its enduring brand and customer loyalty. Key Lesson: Crisis creates opportunity - invest in companies with strong fundamentals even when they face temporary setbacks.

  • 1964 - Acquires Berkshire Hathaway: What began as a struggling textile mill soon became the flagship of Buffett’s investment empire. Key Lesson: Don’t be afraid to pivot when an initial investment doesn’t go as planned. Buffett took the cash flow from a fading business and instead reinvested it into more efficient ones, profiting from the difference.

  • 1967 - Enters the Insurance Business: Buffett acquires National Indemnity, gaining access to a steady stream of insurance "float”- aka capital that he could invest elsewhere. Key Lesson: Leverage cash flow (float) from a stable business to fuel long-term investments (he took the premiums the insurance firm received and invested them elsewhere for higher returns).

  • 1973 - Buys Washington Post Shares: Buffett invests in the Washington Post, building a relationship with publisher Katharine Graham and becoming one of the company’s largest shareholders. Key Lesson: Invest in strong brands and trusted leadership.

  • 1991 - Becomes Chairman of Salomon Brothers: After a bond scandal threatened Salomon Brothers (a major U.S. investment bank), Buffett stepped in as Chairman to restore credibility, leveraging Berkshire's significant ownership stake. His leadership included direct intervention with the U.S. Treasury to reverse a ban on Salomon bidding in government bond auctions - an action that saved the firm. Key Lesson: Reputation is more valuable than money.

  • 1988 - Invests in Coca-Cola: Buffett acquires a major stake in Coca-Cola, a brand he personally loves, which becomes one of Berkshire Hathaway’s most successful investments. Key Lesson: Buffet is infamous for drinking multiple cans of Coke per day (some say up to 5). Thus, invest in businesses you understand and love.

  • 2008 - Bails Out Goldman Sachs: During the 2008 financial crisis, Buffett invested $5 billion in Goldman Sachs, negotiating favorable terms that yielded massive profits. Key Lesson: In times of crisis, cash is king, and timing is everything.

 

Buffett’s Contradictions: Champion of Competition or Monopolies?

Buffett often praises competition, but his biggest wins come from near-monopolies:

  • Coca-Cola: A global brand with unmatched dominance.

  • American Express: A financial powerhouse with loyal customers.

  • Burlington Northern Santa Fe (BNSF): A railroad giant with little competition.

Buffett preaches capitalism but profits from businesses with “economic moats” – strong barriers against competition. Hypocritical? Maybe. Smart? Absolutely.

The Legacy of Warren Buffett

Warren Buffett’s life is a case study in patience, discipline, and relentless value-seeking. His principles of value investing, contrarian thinking, and emotional discipline have changed the world of finance.

But beyond the numbers, Buffett’s legacy is about wisdom. In a world obsessed with fast money and speculation, he is a reminder that staying rational is key.

He once said, “Someone is sitting in the shade today because someone planted a tree a long time ago.”

So don’t chase the shadows. Instead, be like Buffett and plant the trees.

Want to Learn More?

And Want to Learn Even More About Warren Buffett?

  • If you want a deeper understanding of Warren Buffett's life, investing philosophy, and rise to becoming the Oracle of Omaha, I recommend the book "Buffett: The Making of an American Capitalist" by Roger Lowenstein.

Sources:

  1. Buffett to step down as Berkshire CEO after 60 years at helm, passes baton to Abel | Reuters
  2. Mental Models: The Best Way to Make Intelligent Decisions (~100 Models Explained)
  3. Chart: Buffett's Berkshire Hathaway: Consistent Outperformance | Statista
  4. The Salad Oil Scandal of 1963 - Fundamental Finance Playbook

Disclosures:

This communication is general in nature and provided for educational and informational purposes only. It should not be considered or relied upon as legal, tax or investment advice or an investment recommendation, or as a substitute for legal or tax counsel. Any investment products or services named herein are for illustrative purposes only and should not be considered an offer to buy or sell, or an investment recommendation for, any specific security, strategy or investment product or service. Always consult a qualified professional or your own independent financial professional for personalized advice or investment recommendations tailored to your specific goals, individual situation, and risk tolerance. All examples are hypothetical and are for illustrative purposes only.

Information contained in the materials included is believed to be from reliable sources, but no representations or guarantees are made as to the accuracy or completeness of information. This document is provided for information purposes only and should not be considered as investment advice.

Dunham & Associates Investment Counsel, Inc. is a Registered Investment Adviser and Broker/Dealer. Member FINRA/SIPC. Advisory services and securities offered through Dunham & Associates Investment Counsel, Inc. 

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