Warren Buffett says this is how to financially survive the coronavirus
Warren Buffett says this is the way to financially survive the corona virus
When Warren Buffett speaks or acts, millions of investors pay attention.
The popular financial guru who eats at McDonald's and still lives in his hometown of Omaha, Nebraska, is a multi-billionaire. Buffett fans watch him closely for tips on how they can be incredibly rich.
Ears have increased in the past few weeks as Buffett shared some money about the coronavirus crisis. Wall Street has recently given new clues to reports of new outbreaks in several states.
See what the "Omaha Oracle" has to say about the pandemic and equity investments, credit card debt and more.
Always be ready for the worst
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Buffett said that a "mega catastrophe" would come.
You don't call him an oracle for nothing. The multimillionaire said during an interview in March: "I always felt that a pandemic would happen at some point."
Last year he warned that the world was facing a "mega catastrophe". Buffett wrote to his Berkshire Hathaway Company shareholders that it would be a kind of "total surprise" that would overshadow devastating hurricanes Katrina and Michael.
He said Berkshire, which is large in the insurance business (it owns Geico and other insurers), would suffer massive losses - but would be up and running the next day.
As with Buffett, you can be prepared for anything by taking out life insurance that provides financial protection to your loved ones. In just 90 seconds online, you can find several life insurance rates that are tailored to your family's needs and cost just $ 1 a day for $ 1 million in insurance coverage.
Do not carry credit card credits with you
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Buffett says that if you carry credit card debt, you will get rid of it
As layoffs skyrocketed during the outbreak and closures, Americans have accumulated more credit card debt: 47% now have credit, up from 43% in March, and nearly a quarter say they have increased their card debt as the corona virus downturn. A survey by CreditCards.com was found.
Turning to credit cards because of financial difficulties is one thing, but Buffett says some people use them as a "piggy bank to be robbed".
He recently told shareholders of his company about a friend who had gotten lucky and asked for advice on what to do with it. She also had credit card debt - at 18% interest.
"If I owed 18% of money, the first thing I would do with my money would be to repay it," Buffett said, telling her. "You can't go through life to borrow money on these terms and be better off."
Whenever credit card debt appears overwhelming, experts say that a good first step to getting rid of it is to include it in a debt consolidation loan - at a much lower interest rate than 18%.
Be careful with stocks
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Buffett has withdrawn from airline stocks due to COVID-19.
The coronavirus crisis is devastating entire industries, including retail, restaurants and entertainment. Buffett has decided that the damage to a particular industry is greater than he can take as an investor.
"The airline business - and I'm wrong and I hope I'm wrong - has changed fundamentally," he said at the Berkshire Hathaway online general meeting in May. In this way, he explained why the company had sold all airline shares it owned.
Buffett said people were prevented from flying. "The world has changed for airlines."
One of the airlines Berkshire removed from its portfolio was Delta Air Lines, whose share price has lost half of its value since the beginning of the year.
Buffett pays attention to his shareholders, how a robo advisor can protect an everyday investor like you. These automated investment services automatically adjust your portfolio to give you some cushioning when single stocks or entire sectors fall off a cliff.
Stick to your long-term plan
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Buffett says stay on target with your financial goals.
Warren Buffett is confident that the US economy will recover from the COVID-19 pandemic.
"Nothing can stop America in principle," he said at the virtual general meeting. "We haven't really faced anything that is very similar to this problem, but we have had to deal with harder problems. The American miracle, the American magic has always prevailed and will continue to do so."
But he also said that no one knows what will happen, so investors should be prepared for a potentially long recovery.
"You will get a good result if you hold stocks for a long period of time," Buffett said.
In other words, you have to hold on at times like this. A financial planning service can help you focus on your investments. Today you can get in touch with a certified financial planner online and at low cost to achieve your long-term goals.
Benefit from low interest rates
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With interest rates falling, Buffett says it's a good time to take out loans.
Buffett became one of the richest people on the planet using opportunities. Courtesy of the Federal Reserve, he currently sees some fantastic opportunities.
"This is a very good time to borrow money, which means that borrowing money may not be so good, but it is good for the country that it is a good time to borrow money," said he to his shareholders.
To help the economy recover from the corona virus, the Fed "did the right thing" by lowering a key rate to near zero, Buffett said.
For home buyers and homeowners, it's an excellent time to borrow. Thanks in part to the Fed, new and refinancing mortgage rates are the lowest in existence - and it's possible to find 30-year loans with rates below 3% if you look around and compare mortgage offers from multiple lenders.
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