Earlier this month, Buffett announced he's stepping down as chairman of Berkshire Hathaway.
His farewell letter offered some wise words that every investor should know.
After spending more than half a century as chairman of Berkshire Hathaway, Warren Buffett announced this month that he would be stepping down and handing the reins over to his son, Howard Buffett.
In a letter to shareholders announcing the transition, Buffett emphasized that he has full faith in CEO Greg Abel and will continue to serve as a director. But he also offered one nugget of wisdom that, while sobering, reflects the philosophy that made Buffett one of the most successful investors in history.
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In his farewell letter, Buffett recalled celebrating his 96th birthday and recognizing that it was time to move on. "Father Time always wins," he reflected.
While this four-word message is a somber reminder that our time is limited, it also echoes his core philosophy of long-term investing. Buffett generated roughly 98% of his $160 billion fortune after age 65, according to 2025 data from Creative Planning, and he's famously credited his success to the power of compound earnings.
Compounding creates a snowball effect on your investments, helping you build exponentially more wealth over time. For example, say you're investing $200 per month while earning a 10% average annual return on your investments. At that rate, here's approximately how much you could accumulate, depending on how long your money is given to grow.
| Number of Years | Total Portfolio Value |
|---|---|
| 10 | $38,000 |
| 15 | $76,000 |
| 20 | $137,000 |
| 25 | $236,000 |
| 30 | $395,000 |
| 35 | $650,000 |
| 40 | $1,062,000 |
Data source: Author's calculations via investor.gov.
Building wealth takes time, and it's often slow at first. But after decades, once the snowball is accelerating down the hill, it's possible to generate hundreds of thousands of dollars per year in passive investment income. No matter how much you're investing each month, time is your most precious resource.
If there's just one move to make right now, it's to keep investing consistently. Every year counts, and by investing in quality stocks with long-term growth potential, you'll be on your way to life-changing wealth.
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Katie Brockman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.