Billionaire investor Warren Buffett says that for wealthy people there comes a point where money “has no real utility.”
In an interview with Yahoo Finance’s editor-in-chief Andy Serwer at the Concordia Summit, the 86-year-old Berkshire Hathaway CEO discussed The Giving Pledge, which he founded with Bill and Melinda Gates in 2010. The pledge is a signed commitment by the wealthiest people to give away more than half of their money to philanthropy either during their lives or when they die.
Buffett argued that excessive wealth doesn’t do much for the rich and their families.
“There comes a point where money really has no real utility,” he said. “You can use it to show off, but you can’t do much else with it. I don’t think it’s good for your family. It can do wonders for people around the world.”
He noted that when the Forbes’ “rich list” of 400 wealthiest people debuted in 1982 the total wealth was around $92 billion. Now it’s $2.4 trillion.
“There’s a greater concentration of wealth than there was 30 or 20 years ago,” he noted. “What can you do with it? It seems so obvious to me you can take wonderful care of yourself. Are 10 houses better than one? Do you really want a boat?”
Buffett ranks No. 3 in the world on the rich list with an estimated net worth of $63.5 billion. He’s always maintained a low-key lifestyle, living in a modest home in Omaha and driving a practical car.
To date, 150 people have signed the pledge.
Julia La Roche is a finance reporter at Yahoo Finance.