Warren Buffett Changes Christmas Gift Tradition to Berkshire Hathaway Shares

Shift from Cash to Long-term Investments

Warren Buffett, known as the 'Oracle of Omaha', has modified his annual Christmas gifting tradition to family members. Instead of giving cash gifts of US$10,000, he now provides shares of Berkshire Hathaway worth the same amount. This change comes after Buffett observed that his previous cash gifts were being spent quickly by family members.

Rationale Behind the Change

According to Mary Buffett, former daughter-in-law of Warren Buffett, the family would typically spend the cash gifts immediately upon receiving them. In contrast, gifting Berkshire Hathaway shares encourages a long-term investment mindset. The shares gifted are typically from companies Buffett has recently invested in, such as Coca-Cola.

Investment Philosophy Alignment

This change in gifting strategy aligns with Buffett's well-known value investing philosophy. By gifting shares rather than cash, Buffett is teaching his family members the importance of holding valuable investments rather than spending windfalls. The approach also gives them exposure to Berkshire Hathaway's diverse portfolio and investment strategy.

Significance of Berkshire Hathaway Shares

Berkshire Hathaway, Buffett's investment vehicle, has a diverse portfolio that includes major companies across various sectors. Gifting these shares not only provides financial value but also educates recipients about the principles of long-term value investing that Buffett has championed throughout his career.