Investment legend and chairman and CEO of Berkshire Hathaway, Warren Buffett, continues to demonstrate his commitment to modesty and frugality through his $100,000 annual salary.
Despite his status as one of the world’s richest people, public filings with the Securities and Exchange Commission show that Buffett has not received a pay raise in more than four decades.
Berkshire Hathaway’s recent proxy statement reveals a remarkable aspect of Buffett’s compensation package. While his salary remains modest, the company allocated three times that amount last year solely for Buffett’s personal and home security expenses. As a result, when these security costs are taken into account, Buffett’s total compensation for the year was $402,000. This figure is in stark contrast to the $18 million average salary among S&P 500 CEOs in 2021.
Do not miss it:
To provide additional context, it’s worth highlighting the significant differences in pay within Berkshire Hathaway itself. Ajit Jain, who oversees the insurance division, and Greg Abel, who is responsible for the non-insurance division, have consistently received annual salaries of $16 million along with a $3 million bonus for the past three years. This contrast highlights Buffett’s distinctive approach to his own salary.
Buffett’s investment success shows that real money goes beyond traditional salaries and can be achieved by anyone with the right approach. One such approach is investing in startups through funds like Bioverge, which allow people of all financial backgrounds to invest in a diverse portfolio of exceptional healthcare startups. Each startup is carefully selected for its potential to address key healthcare challenges.
Despite his immense wealth, Buffett’s lifestyle remains down to earth. With an estimated net worth of over $114 billion, he embraces simplicity and frugality in his personal choices. He lives in a modest family home, drives a regular car and can often be found having breakfast at McDonald’s.
Buffett and his business partner Charlie Munger eschew extravagant perks that could come at the expense of the company. They refrain from using company cars and refuse memberships at exclusive clubs where Berkshire would cover dues.
To stay up to date with the best startup news and investments, sign up for Benzinga’s Startup Investing & Equity Crowdfunding newsletter
When it comes to personal travel, they choose to pay standard fares to Berkshire-owned NetJets Inc., a part-ownership provider for private jets, rather than using the company’s planes.
While it’s true that Buffett occasionally uses company resources for private tasks, such as sending letters or making phone calls, he diligently reimburses Berkshire for these expenses. According to the proxy statement, he makes an annual payment of $50,000 to cover these costs, ensuring that he acts with integrity and honesty in his dealings.
Both Buffett and Munger have told Berkshire’s board of directors that they are satisfied with their $100,000 salary. They have no expectations or desires for a pay rise. At Berkshire’s 2017 annual shareholders’ meeting, Buffett shared his view on compensation for his successor. He expressed the hope that the next CEO would already have financial security and be motivated by factors beyond monetary gain.
In 2006, Buffett made a life-changing commitment to gradually donate all of his Berkshire Hathaway stock to charitable foundations. More than 99% of his wealth will be spent on philanthropy during his lifetime or after his death. According to Forbes, he has already given away more than $51 billion.
See more on starting investing from Benzinga:
Don’t miss real-time alerts about your stocks – join Benzinga Pro for free! Try the tool that helps you invest smarter, faster and better.
This article Warren Buffett’s salary is $100,000 a year – he hasn’t had a raise in 40 years and he gives half back to Berkshire Hathaway originally appeared on Benzinga.com
© 2023 Benzinga.nl. Benzinga does not provide investment advice. All rights reserved.