In 2006, Warren Buffett startled everyone by pledging to donate almost all of his enormous fortune. Since then, Buffett has given more than $55 billion of his Berkshire Hathaway holdings to charitable organizations. One such gift, made in late June, was worth $5.3 billion, which caused him to fall from the eighth to the tenth rank on Forbes’ list of the world’s richest people—his lowest position in more than 20 years. According to Forbes, he is worth $128.9 billion.
The hypothetical wealth of an ungiving Buffett
However, what would have happened if Buffett—possibly the greatest philanthropist in history—had chosen to keep all of his Berkshire shares for himself?
When Buffett made that historic declaration in the summer of 2006, he had 474,998 class A shares, which were valued at almost $43 billion at the time. He would be sitting on a stack of shares worth $292 billion if he still owned all of that stock today.
With personal assets and another $1 billion or so in class B shares, a less-giving Buffett would be worth about $293 billion. As a result, he would be around $41 billion wealthier than Elon Musk, the planet’s current richest person (net worth: $252.4 billion); $77 billion ahead of Jeff Bezos, the number two ($215.9 billion); and $102 billion ahead of Bernard Arnault, the number three ($191 billion). Buffett would be worth more than two Bill Gateses combined, not $6 billion less than his friend Bill Gates ($135.2 billion).
Impact of Buffett’s philanthropy
Stated differently, Warren Buffett would undoubtedly be the richest person on the planet if he hadn’t decided to start donating his fortune. According to Forbes projections, he would just fall short of the record for the biggest fortune ever, which was briefly exceeded by Musk in 2021 when his wealth reached over $300 billion. Buffett could purchase every share of Coca-Cola, every McDonald’s Corporation, and every one of the top 50 sports teams in the world with his hypothetical $293 billion fortune.
Rather, the renowned thrifty Buffett has been striving to donate over 99% of his wealth, mostly through a summertime custom of billion-dollar gifts to five carefully chosen foundations from his stock holdings, with each year’s offering consisting of 5% fewer shares than the one before it. He once wrote, “My family and I will fulfil this 99% pledge by giving up nothing we need or want.” “I’m going to keep living a life that provides me with everything I could possibly want.”
Continuing the legacy of giving
Buffett has mostly given his gifts to a trust that supports the Bill & Melinda Gates Foundation, which received stock valued at the time of the gift over $43 billion. The $75 billion (endowment) nonprofit that Bill Gates, Buffett’s friend and bridge partner, and his then-wife Melinda French Gates founded in 2000 has used the funds for programs that address poverty and healthcare in developing nations as well as economic mobility and education in the United States. To inspire other billionaires to contribute at least half of their wealth to charitable causes, Buffett and the Gateses co-founded The Giving Pledge in 2010. In 2021, Buffett resigned from his position as a Gates Foundation trustee. That same year, French Gates got divorced from Gates, and earlier this month, she quit the foundation to do it alone.
The remaining shares have been given as gifts to Buffett’s three children and a foundation founded in honor of his late wife, with the intention that the shares are donated to organizations of their choosing. At the time of his donations, shares valued at over $4.8 billion were donated to the Susan Thompson Buffett Foundation, a healthcare and education-focused organization created in honor of his late wife. (That amount excludes the minimum $2.9 billion that Susan’s estate donated to the foundation after her 2004 passing.) Additionally, Buffett has contributed more than $8 billion (as of the time of his gifts) to the Sherwood Foundation, Howard G. Buffett Foundation, and NoVo Foundation, the three charities founded by his children.
A journey of generosity and impact
The 93-year-old investor has donated nearly two decades of his life to Berkshire, reducing his holdings to 207,963 class A shares as of July 8, still valued at about $128 billion. Until his death, he intends to continue donating stock to the five foundations annually. However, he stated that he has determined that, contrary to what was previously thought, the majority of Buffett’s estate will go to a charitable trust managed by his children upon his death, in a letter dated November and an interview with The Wall Street Journal that was published in late June. Upon completion of their work, Buffett and the executors of his estate will have donated over 99% of their fortune to charitable causes.
Buffett, who has lived in the same humble Omaha, Nebraska house since 1958 and frequently stops at McDonald’s for lunch, paying in precise change, said in 2021, “Society has a use for my money.” “I’m not,”
(Tashia Bernardus)