Warren Buffett, the “Oracle of Omaha” is one of the top philanthropists in the world. To date, his charitable donations, mostly in the form of Berkshire Hathaway shares, have totaled to more than $25 billion. Much of his philanthropy goes to the Bill and Melinda Gates foundation, but there are a handful of other charities he donates to.
However, Warren Buffett’s philanthropy didn’t really ramp up until the mid 2000s. Prior to that, while he did donate to charity, he didn’t donate much. This brought about a lot of criticism to the Oracle of Omaha. But, recently, in the “Becoming Warren Buffett” documentary, a previously unreleased interview with the late Susan Buffett and other interviews with friends of the family and Warren himself insights into why Buffett didn’t donate his money earlier.
According to the documentary, it was because Buffett understood that with compounding interest, the more money he had, the more money he would be able to give later.
“You don’t have to be particularly smart, you just have to be patient,” Buffett said in the documentary. “Susie didn’t want to wait as much as I did — she never quite appreciated compounding like I did.”
“That is a disagreement we have,” Susan Buffett said in an interview included in the documentary. “… I think we should be giving more money away. But I understand why we don’t — because it’s business.”
This mentality—that a little now will make more later—is the exact same philosophy that keeps Berkshire Hathaway from paying dividends to investors.
However, that doesn’t mean that Buffett is stingy—the opposite, in fact. Through the Giving Pledge, Buffett has promised to give away the majority of his wealth either before or after he dies.