Warren Buffett Changes His Will: Here’s What Will Happen to His Money After His Death

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Warren Buffett Changes His Will
(Image by chiplanay from Pixabay)

Warren Buffett, the legendary 93-year-old investor and chairman of Berkshire Hathaway, has made significant changes to his estate plans. This news was disclosed in an exclusive interview with the Wall Street Journal and during his annual letter to Berkshire Hathaway shareholders.

Buffett's revised will sheds light on how his substantial fortune will be distributed after his death, marking a notable shift in his long-standing philanthropic strategy.

A Shift in Strategy

For many years, Buffett’s will designated more than 99% of his estate for philanthropic purposes. The primary beneficiaries were the Bill & Melinda Gates Foundation and four other charities associated with his family:

  • The Susan Thompson Buffett Foundation
  • The Sherwood Foundation
  • The Howard G. Buffett Foundation
  • The NoVo Foundation

However, Buffett’s recent decision marks a departure from this long-standing plan. He announced that he will no longer continue donations to the Gates Foundation after his death. Instead, he will establish a new charitable trust overseen by his three children.

This trust will be the primary recipient of his wealth, ensuring his legacy extends beyond his lifetime through his children's stewardship.

Trusting His Children’s Values

Buffett has expressed unwavering confidence in his children’s ability to carry out his philanthropic wishes. Each of his offspring runs their own philanthropic organizations, and Buffett believes their values align closely with his vision. In his interview, he stated, “I feel very, very good about the values of my three children, and I have 100% trust in how they will carry things out.”

The Gates Foundation’s Response

Mark Suzman, the chief executive of the Gates Foundation, acknowledged Buffett’s immense generosity over the years. Buffett has been a key supporter of the foundation’s work through significant contributions and advice. Suzman expressed deep gratitude for Buffett’s most recent gift, which amounts to approximately $43 billion.

Despite Melinda Gates announcing her departure from the organization in May, the foundation's name remains unchanged.

Detailed Breakdown of Buffett’s Estate

To reflect his commitment to philanthropy during his lifetime, Buffett is converting approximately 9,000 Class A shares of Berkshire Hathaway into more than 13 million Class B shares. Here’s the breakdown of these shares:

  • 9.3 million shares will be transferred to the Bill & Melinda Gates Foundation Trust.
  • The remainder will be distributed among the four Buffett family charities.

As of now, Buffett’s holdings in Berkshire Hathaway consist of 207,963 Class A shares and 2,586 Class B shares, collectively worth approximately $128 billion.

Additional Changes and Provisions

Philanthropic Trust

The newly established charitable trust, overseen by his three children – Susan, Howard, and Peter – will be central to his revised will. This trust is intended to support various philanthropic causes, particularly those focused on:

  • Education
  • Healthcare
  • Poverty alleviation

Buffett has indicated that his children’s existing foundations will play a critical role in managing the trust, leveraging their experience and commitment to charitable work.

Family Involvement

While Buffett has long maintained that he would not leave vast sums of money to his children, each of them will receive significant inheritances that are modest compared to his total wealth. Additionally, Buffett's children will take active roles in the governance of his charitable foundations, ensuring the effective execution of his philanthropic vision.

Investment Philosophy

In his recent letter to shareholders, Buffett reiterated his timeless investment principles, which have guided Berkshire Hathaway to its current success. He emphasized the importance of:

  • Long-term thinking
  • Patience
  • Avoiding unnecessary risks

Buffett advised investors to stay clear of speculative ventures and focus on acquiring shares in solid, well-managed companies. He remains confident in the future of Berkshire Hathaway under the leadership of his chosen successors, particularly Greg Abel and Ajit Jain.

Key Takeaway Points

  • Warren Buffett’s will has been significantly revised, marking a departure from his long-standing philanthropic strategy.
  • Philanthropic Commitments: The bulk of Buffett’s wealth will be directed to a newly established charitable trust overseen by his three children.
  • Trust in Family: Buffett has expressed complete confidence in his children’s ability to carry out his philanthropic wishes.
  • Distribution of Shares: Buffett is converting Class A shares into Class B shares, with a significant portion allocated to the Gates Foundation and the remainder to family charities.
  • Succession Planning: Buffett’s chosen successors at Berkshire Hathaway, Greg Abel and Ajit Jain, will ensure the company’s stability and adherence to his investment philosophy.
  • Investment Philosophy: Buffett continues to emphasize the importance of long-term thinking, patience, and avoiding speculative investments.

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