Warren Buffett, the oracle of Omaha and Ravi from Delhi have something in common. They both were witness to what can be called a superpower. While Buffett used it deliberately, Ravi’s story reveals a powerful lesson for the impatient investors, who want to keep jumping from one investment to the other. Discover this superpower below…
It was a fine morning in 2016. A young Ravi, a resident of Delhi, had a few questions about some shares he came upon. He decided to call the experts on the pre-market show on Zee Business. What unfolded was a story that is now investing folklore.
Ravi’s grandfather, who had a severe paralysis attack around 2006, recovered by 2016 thanks to Ravi’s caretaking abilities. As a gift to this grandson, he gave him 20,000 shares of a company he had bought back in 1990. However, these were paper shares, and the world had already moved on to digital i.e. demat.
So, Ravi called the experts to ask them how he should go about selling these now. The conversation progressed and Ravi revealed the name of the company – MRF. Yes, the tyre company.
There was a brief silence in the studio, followed by the experts guiding him on how he can still dematerialise the shares if he wished to sell them. And then came the hammer.
The anchor told Ravi the amount the shares he had in is hands amounted to… Rs 130,00,00,000.
Yes, Rs 130 CRORE.
Of course, now the silence was on Ravi’s end of the phone line, for obvious reasons.
What is this superpower that made Ravi a multi-millionaire over a simple phone call?
The Superpower
Before you read all about the superpower, here is a fun-fact.
Did you know that one of the richest men in the world, Warren Buffett, accumulated 96% of his massive wealth after his 65th birthday?
Now that did not happen overnight like it happened for Ravi. Actually, even in case of Ravi, it did not happen overnight. It did happen over years, but silently in the background. What is this superpower?
The answer is simple – Compounding.
Compounding is akin to planting a seed. Imagine earning interest not only on the money you invest, but also on the interest you have earned i.e. interest on interest. Let’s say you have Rs 10,000 in a bank that gives 10% interest each year. After one year, you get Rs. 1,000 as interest, so you have Rs 11,000. The next year, you earn 10% on Rs 11,000, which is Rs 1,100. Now you have Rs 12,100.
Did you see how the second year was better than the first? That’s compounding.
Over time, your money grows faster because the interest keeps adding up.
Now ,you probably already understand this well. And may find this underwhelming.
But it get’s better.
To this mix of compounding, you add time i.e. tenure. And then, magic happens. The kind of magic that can return Rs130 crore, or perhaps even US$ 130 bn.
Buffett’s Riches After 65
When you hear Buffett made most of his money after he was 65, to a novice it might give the impression that he found a goldmine on his 65th birthday. But the case exactly the opposite. Compounding works best when you start early and stay patient.
Buffett believed in and followed an ideology or strategy that made him what he is today. Remember, he once famously quoted,
“The stock market is an instrument to transfer wealth from the impatient to the patient.”
He bought his first stock at age 11 and by the time he turned 65, his money had been growing for over five decades. By 2025, his net worth is estimated to be over $130 bn. But most of that came in the last few decades.
How does that happen? It’s all about time.
When Buffett was young, his investments grew steadily. Let’s say his money doubled every few years. In the early days, a doubling might mean going from $1,000 to $2,000. Sounds great, but not life changing.
But by age 65, his wealth was already in the billions. So, a doubling at that stage meant adding billions more. That’s why 96% of his fortune came after 65.
What is the secret here?
Time – Your Secret Weapon
Here’s a lesson for you: start early!
Even small amounts can grow into a fortune if you give them time. Imagine you’re 25 years old and you start investing Rs. 5,000 a month. At a 10% annual return, by the time you’re 60, you could have close to Rs 2 cr. But if you wait until you’re 35 to start, you might only have Rs 67 lacs by 60. Those extra 10 years make a huge difference. Time is your best friend when it comes to compounding.
Buffett is famous for staying calm, even when the stock market crashes. He never pulled his money out in a panic. Because he knew compounding needs time to work its magic. If you take your money out during a bad market, you stop the growth. But if you stay invested, your money keeps growing, even during tough times. Buffett trusted the process, and it paid off big time. So, he wasn’t kidding when he said that his favourite investment period is FOREVER!
Let’s look at a quick example to see why patience matters. Say you invest Rs. 1 lakh at an 8% return per year. After 10 years, it grows to Rs 2.15 lakh. After 20 years, it’s Rs 4.66 lakh. Wait another 10 years-30 years total-and it’s Rs 10.06 lakh. The growth in those later years is massive! That’s why Buffett’s wealth skyrocketed after 65
Same for Ravi’s grandfather. 20,000 shares of MRF as of today’s (May 9, 2025) price is worth approximately a whopping Rs 275 cr! And all Ravi and his grandfather had to do was be patient and let compounding work its magic.
Don’t Panic—Patience Pays Off
While most investors are always on the prowl for the next fad or trend, Buffett could care less about following the herd. He ignored the market noise and stayed invested in his picks. He invested in Coca-Cola in 1988 and still holds 40 cr shares of the company worth $28.5 bn.
He also has held American Express since 1991 and holds over 15 cr shares of the company worth $43 bn.
Both these companies have seen bad times. Coca-Cola saw markets change for it with the war against sugar consumption and plastic globally, which has been going on for years. The organisation ‘Break Free from Plastic’ names Coca-Cola one of the world’s top plastic polluters in annual audits for several consecutive years (e.g., 2018-2023), highlighting the company’s significant contribution to the global plastic waste crisis.
American Express on the other hand like other financial institutions, faced increased credit losses and reduced consumer spending during the global financial crisis in 2008.
But Buffett was patient and held on to these stocks and is still holding them.
Start Small, Dream Big
As a young investor reading this, there might be question in your mind – “I don’t have a lot of money to invest.”. News flash! Neither did Buffett when he started. But what you can learn from him is that he started with small amounts he saved from his job as a paper boy. He invested wisely, consistently and most important – PATIENTLY!
Also know the risks of reinvestments. Look around in the market, there are investors who got greedy after they made money from some stocks. They quickly sold those stocks, and with that money bought new stocks, that went on to be duds, turning their profits into some bad losses.
Having said that, all you need to do is start. Even Rs 1,000 invested every month consistently could make you some wealth. The key is consistency. Keep investing regularly, even if it’s a small amount. Don’t let market scares and noise fall off the wagon. Pick smart investments like mutual funds or stocks of strong companies after due diligence. Buffett loves businesses that are steady and reliable. He buys them and holds them for years. You can do the same. Pick wisely, stay consistent, and then just sit back and relax. Watch your money compound!
The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
Suhel Khan has been a passionate follower of the markets for over a decade. During this period, He was an integral part of a leading Equity Research organisation based in Mumbai as the Head of Sales & Marketing. Presently, he is spending most of his time dissecting the investments and strategies of the Super Investors of India.
Disclosure: The writer and his dependents do not hold the stocks discussed in this article.
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