From the early days Zak and I mused over a concept we called “X-amount” – where X was the amount of money that we felt would be required to put food on the table, pay for the kids education, have a nice life-style, own our own homes and so on. I had my X-amount and Zak had his, and readers will each have their own, and they will all be different. The idea was to place the surplus above X in different psychic space to money we felt we needed with the intention that, if it was mentally parked, the excess would be less likely to distort our thinking or relationships with friends and family, and less likely to encourage the very human drift toward an indulged life, just because you can.
We often attended the Berkshire Hathaway annual general meetings in Omaha, Nebraska and at one meeting the firm’s Chairman and Founder, Warren Buffett, was asked what it felt like to give away U$35bn, which is what he had just pledged to the Gates Foundation? Buffett’s response was that he did not feel anything at all and, judging from the collective gasp, his answer stunned some in the room. After all, many attendees had only made the pilgrimage to Omaha because Buffett was worth U$35bn in the first place, and now he was saying he felt nothing as he gave it away.
In our opinion, what Buffett was revealing was that he did not take personal identification in everything above his X-amount. In making the donation, all that had occurred was one name on a ledger, recording share ownership, had been rubbed-out and another inked-in. But more importantly, he felt nothing because, mentally, he had made that change decades ago.
Investors can think their way to success without seeming to work in the traditional sense and the payoff in capitalism from stock picking can be extraordinary. Investing is a wonderful, thoughtful, adventure but it can also be self-centred, a tendency that can be reinforced by the wealth that can follow. We think it is true that, once past X-amount, real meaning comes with reinvesting in society through charitable giving, which can also be a thoughtful, challenging, wonderful adventure, but with the added bonus that it feels like the world working properly. I hope that you can join us.
Nick Sleep, Spring 2021.