- Warren Buffett recommends investing in yourself through education and skills development as the "best investment" during inflationary times, as it cannot be inflated away and is not taxed. Developing skills like communication can significantly increase your value. - In addition to self-improvement, Buffett recommends real estate, stocks with pricing power abilities, and gold as popular hedges against inflation. Real estate maintains value and stocks like Apple can easily increase prices without much added costs. While skeptical of gold, others see it as stable for maintaining purchasing power.

1. 'It's not taxed at all': Warren Buffett shares
the 'best investment' you can make when
battling against inflation — and it doesn't
have to cost you a dime
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Bethan Moorcraft
Tue, October 3, 2023, 4:30 PM GMT+6ꞏ6 min read
'It's not taxed at all': Warren Buffett shares the 'best investment' you can make when battling
against inflation — and it doesn't have to cost you a dime
Warren Buffett is the seventh richest person in the world — behind Elon Musk, Bernard Arnault,
Jeff Bezos, Bill Gates, Larry Ellison and Larry Page — with an estimated net worth of around
$117 billion, according to the Bloomberg Billionaires Index.
Unlike some of his billionaire contemporaries, the Berkshire Hathaway CEO seems to enjoy
living a simple life, and his strategies for smart investing and amassing wealth don't sound overly
complicated — even during times of inflation.
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While very few people share Buffett’s investing prowess, the billionaire believes it's still
possible to protect yourself against inflation if you follow one of his core philosophies.
“The best thing you can do is to be exceptionally good at something,” he said during last year’s
Berkshire Hathaway annual shareholders meeting. “[People] are going to give you some of what
they produce in exchange for what you deliver.”
Skills are inflation-proof

2. Buffett says you can mitigate the impacts of inflation by focusing on continuous self-
improvement and staying on top of the game in your chosen field.
“Whatever abilities you have can't be taken away from you. They can't be inflated away from
you,” he said. “The best investment by far is anything that develops yourself, and it's not taxed at
all.”
That could mean getting a college degree, completing training courses, working with a mentor or
simply reading more and educating yourself about different cultures, languages, innovations and
so on.
The 92-year-old says you don’t need to go out of your way chasing skills that don’t serve you
well, especially in these tricky inflationary times. Instead, he says, you should aim to do
everyday things exceptionally well. For instance, he thinks strong communication is one of the
most important skills out there.
“One easy way to become worth at least 50% more than you are now … is to hone your
communications skills,” he previously said in a video posted on LinkedIn.
“If you can't communicate, it's like winking at a girl in the dark — nothing happens. You can
have all the brainpower in the world, but you have to be able to transmit it, and the transmission
is communication.”
Of course, surviving through inflationary times requires a little more than just strong
communication skills. Once you’ve invested in yourself, you may want to consider investing in
some of these other popular hedges against inflation.
Real estate
Real estate is generally a “good investment” during times of inflation, according to Buffett.
“They’re the businesses that you buy once and then you don’t have to keep making capital
investments subsequently. So, you do not face the problem of continuous reinvestments
involving greater and greater dollars because of inflation,” he said during the 2015 Berkshire
Hathaway shareholders meeting.
“If you built your own house 55 years ago like Charlie [Munger] did, or bought one 55 years ago
like I did, it’s a one time outlay, and you get an inflationary expansion in replacement capital
without having to replace yourself.”
Read more: Thanks to Jeff Bezos, you can now use $100 to cash in on prime real estate —
without the headache of being a landlord. Here's how
If you want your real estate portfolio to grow beyond your home, you can invest in a residential
real estate investment trust (REIT). REITs are publicly traded. They collect rent from tenants and
pass that rent on to shareholders in the form of dividends.

3. Consider also using an online crowdfunding platform. These allow investors to pool their money
together to buy property (or a share of property) as a group.
If you don’t want the pressure of making investment decisions yourself, investing apps and
online platforms can help you invest in diversified real estate portfolios in ways that will seek to
maximize your returns while keeping your fees low.
Stocks pricing power
Buffett has been around the block a few times, experiencing many highs and lows in the U.S.
economy. He has managed a stock portfolio through periods of double-digit inflation rates in the
1970s and has plenty of insight on what to own when consumer prices spike.
In a letter to Berkshire Hathaway shareholders in 1981, the business juggernaut highlighted two
characteristics that make a business well adapted to an inflationary environment: 1) an ability to
increase prices easily, and 2) an ability to take on more business without having to spend too
much in order to do it.
Buffett likes high-quality businesses with low capital needs, such as Apple. The technology
company boasts some impressive financial metrics — a testament to the company's efficiency,
strength and negotiating power — which have enabled it to thrive during this period of inflation.
The tech giant ranks as Berkshire Hathaway’s largest stock holding at over $170 billion as of
June 30, 2023, making up over 45% of the conglomerate’s entire portfolio.
“Our criteria for Apple was different than the other businesses we own,” Buffett said at the 2023
Berkshire Hathaway annual meeting. “It just happens to be a better business than any we own.”
Gold
While Buffett is known for being uninterested in gold investing — describing it in a 2011 letter
to shareholders as an asset “that will never produce anything” — while other money mavens
consider it to be a solid hedge against inflation because its purchasing power has remained
relatively stable over time.
“The worth of a dollar can be weakened by inflation, but gold provides you with an edge to
combat that decrease in purchasing power,” William Bevins, CFP, CTFA, told CBS News.
One can directly invest in gold by buying it in its physical form, either as bars, coins or jewelry.
Investing apps can also help you invest in the commodity by purchasing shares of gold mining
companies on the stock market. For those looking for more diverse exposure, you can also invest
in gold exchange-traded funds.

4. You may also want to consider opening a gold IRA, an individual retirement account that allows
you to invest in precious metals in physical forms, like coins, instead of stocks, mutual funds and
other traditional investments.
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This article provides information only and should not be construed as advice. It is provided
without warranty of any kind.