Warren Buffett lives a notoriously frugal and modest life, embodying the principle that money isn’t everything, despite having made money since he was a child. His perspective on the difference between being rich and being wealthy illuminates his values and priorities, offering a refreshing take on what it means to live a fulfilled life beyond the accumulation of financial assets.

Don't Miss:

• Can you guess how many Americans successfully retire with $1,000,000 saved? The percentage may shock you.
• Around 56% Of Americans Feel Behind On Saving For Retirement – Will you make enough each month?

During the 1999 Berkshire Hathaway annual shareholder meeting, an audience member asked Buffett which he considered more important: being rich or being wealthy. Buffett, intrigued by the query, asked the audience member to clarify her definition of wealth, acknowledging the term’s potential for diverse interpretations. This exchange set the stage for him to share his insights on the matter.

Despite his massive net worth, Buffett emphasized the limited impact of money on enhancing life’s quality beyond a certain level of financial security. He compared his lifestyle to that of a college student, noting, “They are basically living about the same life I’m living. We eat the same foods … there’s no important difference at all in the car we drive, the television set we watch … there’s really no difference in, you know, they’ve got air conditioning in summer and I got air conditioning.”

This comparison highlights Buffett’s belief that after achieving a moderate level of wealth, additional money has little effect on one’s daily happiness and well-being. Instead, he places a higher value on health and relationships, arguing that these aspects are the true markers of wealth. 

Trending: Breaking records, mortgage loans generated $12.25 trillion of household debt nationwide – What are the other major categories of debt?

“Then you get down to the things of health and who loves you. There’s nothing if you have a minimum level. I mean, you want to have enough so that you eat three times a day and that you sleep in reasonably comfortable surroundings,” Buffett said. "The money makes very little difference after a moderate level."

Buffett’s philosophy extends to work and professional fulfillment, where he believes the most critical aspect is not the financial compensation but the enjoyment of work and the company of colleagues. 

“The most important thing isn’t how much money you make; it’s how you feel during those eight hours in terms of the people you’re interacting with and how interesting what you’re doing is,” he said.

Reflecting on his definition of wealth, Buffett shared a powerful declaration about his willingness to trade wealth for time and the ability to live life on his terms. 

“If you asked me to trade away a very significant percentage of my net worth either for some extra years of life or being able to do during those years what I want to do, I’d do it in a second,” he said.

This statement encapsulates Buffett’s belief that the essence of true wealth lies not in material possessions or bank balances but in the freedom to pursue your passions and enjoy meaningful relationships.

Read Next:

• For many first-time buyers, a house is about 3 to 5 times your household annual income – Are you making enough?
• Are you rich? Here’s what Americans think you need to be considered wealthy.