Warren Buffett is regarded as one of the greatest investors in history, but his story is not one of instant wealth. At just 11 years old, he purchased three shares of Cities Service Preferred at $38 each, marking the beginning of a journey that would change how the world thinks about investing. Today, he is known for turning disciplined, patient investing into an art, proving that a small start can be an advantage rather than a limitation.

Buffett has always emphasized that the principles he followed early on are still relevant for anyone beginning with limited capital. He often points out that when you are working with a smaller amount, you have the flexibility to explore opportunities in smaller companies with higher growth potential—something that becomes harder once your investment pool grows into billions.

For beginners, Buffett’s first rule is to invest in your own knowledge. He has said that his best investment was not a stock but the time he spent learning about businesses and markets. He reads hundreds of pages daily, studying company reports, economic history, and financial principles. His reading list includes classics like The Intelligent Investor by Benjamin Graham, which he credits with shaping his approach, and The Great Crash of 1929 by John Kenneth Galbraith, which taught him how psychology drives market behavior.

Buffett also strongly advocates for low-cost index funds as a safe and effective starting point for most people. These funds allow investors to own a diversified set of companies without needing to pick individual stocks, making them ideal for those with little experience. He argues that over time, index funds tend to outperform most actively managed investments once fees and costs are taken into account.

Another key lesson from Buffett is patience. He warns against chasing “glamour stocks” or following market hype. Instead, he advises understanding a company’s business model, financial health, and competitive edge before investing. In his view, many of the world’s most successful investments required decades of holding, not months. He also stresses the importance of controlling costs, as brokerage fees, management charges, and taxes can erode returns over time.

One of Buffett’s most famous teachings is the magic of compounding. By reinvesting returns and allowing them to grow over long periods, investors can turn modest sums into substantial wealth. He has often said that his life’s work is a product of compound interest and that this principle works best when started early and maintained with discipline.

Buffett also reminds investors not to fear mistakes. Over the years, he has made poor investment choices but treats each as a learning opportunity. The real danger, he says, is failing to learn from those errors and repeating them.

For Indian investors, these lessons are just as valuable. Whether you have a few hundred or a few thousand rupees to start with, following Buffett’s approach—invest in knowledge, start small, be patient, keep costs low, and let compounding work—can put you on the path to long-term financial success. Starting small is not a disadvantage; it is the perfect stage to develop strong habits without the pressure of managing large sums.

As Buffett famously puts it, “You only get to make a few right investments in life, provided you don’t make them wrong.” The earlier you start applying that wisdom, the greater your chances of success.

 

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