Bill Gates’ Advice on Personal Finance: Saving Like a Pessimist …

There may be people who fall better or worse, but no one can deny the ability of Bill Gates to create an empire with Microsoft or change an industry completely at the time like that of personal computers.

Considered for several years one of the richest people in the world, Gates has also been known for managing his fortune quite responsibly., including the activities of the foundation that he founded with his wife.

Throughout his life, Gates has also left some tips on how to manage money that we now collect below.

A personal and professional emergency fund

Despite the fact that when he ran Microsoft it would surely have cost him nothing to finance himself if he went through some difficult times, Gates displayed a practice from a young age that applied to both his personal and professional life: have enough funds to maintain your standard of living and your business expenses for 12 months. Money that should be accessible and not invested.

Sometimes Gates acknowledged that for this he erred on the side of caution., but who prefers that situation to a more risky one.

“I always had to be careful that we didn’t hire too many people,” he said in a 2017 television interview. “I was always worried because the people who worked for me were older than me and had children, and I was always thinking, ‘What if we don’t get paid? Will I be able to handle the payroll?”

For Gates, optimism and pessimism in finance touch

What Gates understands is that “you can only be optimistic in the long term if you are pessimistic enough to survive in the short term.”

The best way to apply this for most people is save like a pessimist and invest like an optimist, according to Gates.

Saving like a pessimist means recognizing that sudden changes can come at any time. Hence Gates’s idea of ​​always having a good inexpensive mattress on hand. The last year and a half with a pandemic that has disrupted thousands of businesses seems to agree.

But Gates also recommends “investing optimistically” once the background and purposes of any company or business have been taken into account, something that in a Linkedin post he said he had learned from his friend Warren Buffet.

Invest in education

For Gates, there is no money better spent than on training and education. Gates dropped out of college, yes, but in a Reddit thread he participated in in 2014, someone asked him, “What’s your best personal financial advice for people making less than $ 100,000 a year?” His answer: “Invest in your education.”

In a 2007 Harvard (late) graduation speech, Gates reflected on his time at the school. “What I remember most of all from Harvard was being in the midst of so much energy and intelligence. It could be exhilarating, intimidating, sometimes even daunting, but it was always challenging. It was an incredible privilege, and even though I left early, I was transformed. my years at Harvard, the friendships I made and the ideas I worked on, “he said then.