Warren Buffett's Final Example
Readers of my blogs and my recently published book know that I have valued Warren Buffett’s wisdom over the years. He retired as CEO of Berkshire Hathway on January 1st after 60 years at the helm.
As is his way, his final act spoke louder than any expression. He did nothing.
As CEO, Buffett had nearly $400 billion in cash to spend in 2025. But he found no opportunities that he considered sensible. After he stepped down on January 1, 2026, Buffett said he didn’t want to be sitting on so much cash. “At certain levels, cash is necessary, but cash is not a good asset.”
For individual investors, Buffett’s takeaway message is powerful: stick to your strategy. Don’t be impulsive and make an emotional decision. Allow your guiding factors to be your goals, time horizon, and risk tolerance. Buffett looked but didn’t find anything in 2025 that would support his strategy. So, he did nothing.
You can be sure that 2026 will have its share of highs and lows. When it has its lows, it is necessary to remember what I've mentioned before: that market gyrations are common.
According to a recent report by Fidelity Investments, “Since 1920, the S&P 500 Index has—on average—recorded a 5% pullback three times a year, a 10% correction once every 16 months, and a 20% plunge every seven years. Corrections have lasted an average of 43 days.”[1]
So, as 2026 evolves, be prepared for some difficult stretches during the year. And be ready to do one of the hardest things for any investor: nothing.
Or, as Warren Buffett put it during the Great Financial Crisis, “For 240 years it’s been a terrible mistake to bet against America and now is no time to start.”
Regards,
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Warren Buffet is not affiliated with or endorsed by LPL Financial or Dispenza Financial.
[1] https://www.fidelity.com/learning-center/trading-investing/markets-sectors/stock-market-corrections
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
Investing includes risks, including fluctuating prices and loss of principal.