Jul 9, 2024,06:30am EDT
In 2006, Warren Buffett shocked the world by pledging to give away nearly all of his vast fortune. Since then, Buffett has donated over $55 billion worth of Berkshire Hathaway shares to charity, including a $5.3 billion gift in late June that dropped him from 8th to 10th place on Forbes’ list of the world’s richest people—his lowest ranking in over two decades. Forbes now estimates his net worth to be $128.9 billion.
But what if Buffett, arguably the greatest philanthropist in history, had chosen to keep all his Berkshire shares?
Back in 2006, Buffett owned 474,998 class A shares of Berkshire Hathaway, then valued at around $43 billion. If he had retained all that stock, it would now be worth $292 billion. Including approximately $1 billion in class B shares and personal investments, a less charitable Buffett would have a fortune of about $293 billion. This would make him $41 billion richer than the current number one, Elon Musk (net worth: $252.4 billion); $77 billion ahead of number two Jeff Bezos ($215.9 billion); and $102 billion above number three Bernard Arnault ($191 billion). Instead of being $6 billion poorer than his friend Bill Gates ($135.2 billion), Buffett would be worth more than double Gates’ fortune.
In other words, had Warren Buffett not chosen to give away his wealth, he would easily be the richest person on Earth. In fact, with a theoretical $293 billion fortune, Buffett would be just shy of breaking the record for the largest fortune ever recorded, set in 2021 when Musk briefly surpassed $300 billion. With $293 billion, Buffett could personally buy the entire McDonald’s Corporation, all of Coca-Cola’s stock, or all 50 of the world’s most valuable sports teams.
Instead, the famously frugal Buffett has committed to giving away more than 99% of his fortune. Each year, he donates billions of dollars worth of stock to five foundations, with each year’s gift being 5% fewer shares than the previous year’s. “My family and I will give up nothing we need or want by fulfilling this 99% pledge,” he once wrote. “I will continue to live in a manner that gives me everything that I could possibly want in life.”
Most of Buffett’s gifts have gone to a trust funding the Bill & Melinda Gates Foundation, which has received more than $43 billion in stock at the time of the gifts. This charity, launched by Buffett’s friend and bridge partner Bill Gates and his then-wife Melinda French Gates in 2000, focuses on poverty and healthcare initiatives in developing countries and education and economic mobility in America. In 2010, Buffett co-founded The Giving Pledge with the Gateses, encouraging other billionaires to donate at least half their fortunes to charitable causes. Buffett stepped down as a trustee of the Gates Foundation in 2021, and French Gates left the foundation earlier this month to pursue her own philanthropic endeavors.
Buffett’s three children and a foundation named for his late wife have received the rest of the shares as gifts designated for their chosen charities. More than $4.8 billion in shares (at the time of his gifts) went to the Susan Thompson Buffett Foundation, named after his late wife, which focuses on healthcare and education. This sum excludes at least $2.9 billion given to the foundation by Susan’s estate following her death in 2004. Buffett has also given over $8 billion in total (at the time of his gifts) to his children’s three charities: the Sherwood Foundation, the Howard G. Buffett Foundation, and the NoVo Foundation.
After nearly two decades of giving, the 93-year-old investor has reduced his Berkshire stake to 207,963 class A shares, still worth around $128 billion as of July 8. He plans to continue gifting stock to the five foundations each year until his death. However, in a November letter and a recent interview with The Wall Street Journal, he revealed that the remaining Buffett fortune will pass almost entirely to a charitable trust overseen by his children, rather than primarily to the Gates Foundation as previously believed. Ultimately, Buffett and the executors of his estate will have donated more than 99% of his wealth to charity.
“Society has a use for my money,” wrote Buffett, who has lived in the same modest home in Omaha, Nebraska since 1958 and often stops at McDonald’s for meals, paying in exact change. “I don’t.”