Warren Buffett's Salary Is $100,000 Per Year — He Hasn't Had A Raise In 40 Years, And He Gives Half Of It Back To Berkshire Hathaway

Investing legend and Berkshire Hathaway Chairman and CEO Warren Buffett continues to demonstrate his commitment to modesty and frugality through his annual salary of $100,000. 

Despite his status as one of the world's wealthiest people, public filings with the Securities and Exchange Commission reveal that Buffett has not received a pay raise in over four decades.

Berkshire Hathaway's recent proxy statement unveils a noteworthy aspect of Buffett's compensation package. While his salary remains modest, the company allocated three times that amount solely for Buffett's personal and home security expenses in the previous year. As a result, when factoring in these security costs, Buffett's total compensation for the year reached $402,000. This figure stands in stark contrast to the average salary of $18 million among S&P 500 CEOs in 2021. 

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To provide additional context, it is worth highlighting the significant divergence in compensation within Berkshire Hathaway itself. Ajit Jain, who oversees the insurance division, and Greg Abel, responsible for the noninsurance division, have consistently received an annual salary of $16 million, along with a $3 million bonus over the past three years. This contrast emphasizes Buffett's distinctive approach to his own salary.

Buffett's investing success demonstrates that the real money lies beyond traditional salaries and can be attained by anyone with the right approach. One such approach is investing in startups through funds like Bioverge, which enable people from all financial backgrounds to invest in a varied portfolio of exceptional healthcare startups. Each startup is carefully selected for its potential to address significant challenges in the healthcare industry. 

Despite his immense wealth, Buffett's lifestyle remains down-to-earth. With an estimated net worth exceeding $114 billion, he embraces simplicity and frugality in his personal choices. He resides in an unassuming family home, drives an ordinary car and can often be found grabbing breakfast at McDonald's. 

Buffett and his business partner Charlie Munger shun extravagant perks that may come at the company's expense. They forgo the use of company cars and decline memberships at exclusive clubs where Berkshire would cover the dues. 

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When it comes to personal travel, they opt to pay standard rates to Berkshire-owned NetJets Inc., a provider of fractional ownership for private jets, rather than using the company's aircraft.

While it is true that Buffett occasionally uses company resources for private tasks like mailing letters or making phone calls, he diligently reimburses Berkshire for these expenses. According to the proxy statement, he makes an annual payment of $50,000 to cover these costs, ensuring that he maintains integrity and fairness in his dealings.

Both Buffett and Munger have said told Berkshire's governance committee that they are content with their $100,000 salaries. They harbor no expectations or desires for a pay raise. During Berkshire's annual shareholder meeting in 2017, Buffett shared his perspective on compensation for his successor. He expressed his hope that the next CEO would already possess financial security and be motivated by factors beyond monetary gains.

In 2006, Buffett made a life-changing commitment to gradually donate all his Berkshire Hathaway stock to charitable foundations. More than 99% of his wealth will be dedicated to philanthropy during his lifetime or after his passing. According to Forbes, he has already given away more than $51 billion.

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