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When it comes to the ultra rich, you might think there’s some unknown secret to attaining such success. But there isn’t, according to billionaire Charlie Munger, who died last week at age 99.
“I don’t know the secret,” Munger told CNBC’s Becky Quick in an interview last month, initially meant to air on his 100th birthday in January. His method for getting ahead — in life and at work — was pretty cut and dry, he added.
“I avoided the standard ways of failing, because my game in life was always to avoid all standard ways of failing,” said Munger. “You teach me the wrong way to play poker and I will avoid it. You teach me the wrong way to do something else, I will avoid it. And, of course, I’ve avoided a lot, because I’m so cautious.”
Munger spent his life “avoiding traps,” like living in the same modest home for 70 years, refusing to follow his rich friends who built mega-mansions, he said. “In practically every case, [fancy houses] make the person less happy, not happier,” he said.
His general sense of cautiousness was well-documented, from his personal disdain for the “gambling” nature of cryptocurrency to his generally conservative spending decisions.
In terms of cryptocurrency: “Sometimes I call it ‘crypto crappo.’ Sometimes I call it ‘crypto s—.’ It’s just ridiculous that anybody would buy this stuff,” Munger told CNBC in February, adding: “It’s totally absolutely crazy, stupid gambling.”
As far as his spending decisions, his penchant for practicality went beyond his investment portfolio.
Once, when Warren Buffett — Munger’s longtime business partner at Berkshire Hathaway — needed to replace a company jet, he wrote to shareholders to justify the $6.7 million price tag. Munger found the purchase to be spendthrift, Buffett recalled in the letter.
“His idea of traveling in style is an air-conditioned bus, a luxury he steps up to only when bargain fares are in effect,” wrote Buffett.
Indeed, avoiding obvious risks, frivolity and “crazy” situations were instrumental to Munger’s financial success and longevity, he told CNBC last month.
“Avoid crazy at all costs. Crazy is way more common than you think,” said Munger. “It’s easy to slip into crazy. Just avoid it, avoid it, avoid it.”
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