After all the market volatility last week, the Wall Street Journal put together a five-point list, based on advice from the late Walmart founder and billionaire Sam Walton, on how to think (and invest) like the “very wealthy.”
The Journal reported that when the stock market crashed in October 1987 — and Walmart Stores lost around $3 billion — Walton “was unfazed.” When he died five years later, he still managed to leave his heirs with around $100 billion. Here are his tips:
• The very wealthy have a plan. Sam Walton set up a family partnership well before opening his first Wal-Mart in 1962.
• The very wealthy live below their means. Walton “was famously frugal, driving an old pickup truck and flying coach.”
• The very wealthy value cash flow. “Every investor should have a ‘SWAN’ account—for ‘sleep well at night.'”
• The very wealthy focus on risk, not return. “The Walton family wealth long has been tied to its Walmart stock, now valued at $83.6 billion” — but it’s also diversified its portfolio.
• The very wealthy hang on. “The super-rich don’t sell because they are fearful.”