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Warren Buffett just told the world he can’t find anything worth buying. “It’s tough to find values when everybody is preferring gambling,” the 95-year-old told CNBC in mid-July (1).
Then he backed it up with his checkbook. Berkshire Hathaway is sitting on roughly $397 billion in cash — a record hoard — while stocks trade at all-time highs (2).
When the best investor alive parks that much money on the sidelines, I pay attention.
There’s no question the market is overvalued. The “Buffett Indicator” — the total value of U.S. stocks compared to the size of the economy, and Buffett’s own favorite yardstick — recently hit about 238%, one of the highest readings ever (3).
And Americans have never had more riding on it. Households held a record $67.8 trillion in stocks at last count — nearly half of all their financial assets (4).
In plain English: if this market breaks, it’s going to take a bigger bite out of your future than at almost any point in history.
But here’s what the “Buffett dumps stocks” headlines won’t tell you — blindly copying him has been a losing trade this year.
Over the years, I’ve made a few million in the market, and I’ve traded through some though times: Black Monday in 1987, the dot-com bust, the recession of 1990, the Great Recession of 2008 and the 2020 crash.
Here are the 6 moves I’m making with my own money right now.
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1. Keep some cash on the sidelines — and make it earn
Buffett’s holding cash for a reason: when nothing’s cheap, patience is a position. I’ve always kept some money parked and ready, because you never know when the bargain of a lifetime shows up.
The mistake most people make is letting that cash sit in a checking account earning next to nothing while inflation quietly chews through it. If you’re going to hold cash like Buffett (and me), at least make it pay.
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2. Don’t try to time the market — even Buffett can’t
Here’s the part nobody’s putting in a headline: Buffett’s giant cash pile has actually cost him this year. Berkshire is down about 1.4% while the S&P 500 has gained around 10% (2).
Think about that. Even the greatest investor alive can’t reliably nail the top.
I figured out a long time ago that I’m not smart enough to sell at the peak and buy back at the bottom — so I stay at least partly invested, always. Sitting entirely in cash waiting for a crash is its own expensive gamble.
Buffett himself has called today’s market a casino — yet he’s still holding hundreds of billions in stocks. Even he isn’t betting on the end of the world.
3. Don’t let one bad market sink everything you own
The reason a market like this is dangerous isn’t just how high it is — it’s how concentrated your money has become. It’s worth knowing how much of your money really belongs in stocks — because when nearly half your wealth sits there and it all drops at once, there’s nowhere to hide.
That’s why some savers keep a slice of their money in something that doesn’t move in lockstep with Wall Street.
With market swings and inflation on a lot of savers’ minds, some investors, myself included, choose to diversify part of their retirement into physical precious metals.
A Gold IRA lets you roll over an existing retirement account into one that holds physical gold, with the same tax treatment as a traditional IRA — or you can buy physical coins delivered to your door. (Minimum investment: $15,000.)
One of our partners compares leading precious-metals providers on pricing, fees, and the rollover process, so you can review your options in one place. You can check that out here.
Remember, though: Investing in precious metals carries risk, including price volatility. Past performance doesn’t guarantee future results. This is not investment advice.
4. Tune out the noise
Most market “news” is noise dressed up as insight. I’ve read a thousand stories that boil down to “the market may go up, or it may go down — put your helmet on.”
The financial media’s job is to fill airtime, not to fatten your account. When the urge to react to a scary headline hits, that’s usually the exact moment to do nothing at all.
Quick aside — most internet financial advice comes from people who weren’t alive during the last recession. I’ve been writing about money for more than 35 years. Want rock-solid advice? Sign up for the free Money Talks Newsletter. Takes 10 seconds. No fluff. No spam.
5. Get a second set of eyes before you make a move
The most expensive mistakes I’ve watched people make weren’t picking the wrong stock — they were panic-selling at the bottom or having no plan at all. That’s one reason why a good advisor’s real value isn’t hot tips; it’s talking you off the ledge when the headlines get ugly.
Depending on where you are in life, a fiduciary advisor can be really useful. And these days, they’re not hard to find. For example, SmartAsset will instantly match you with up to three fiduciary advisors – legally required to prioritize your interests.
A good advisor will spot tax savings, Social Security strategies, and planning gaps you’d never see alone. The match is free, and so are initial appointments.
$100K+ in investments? Get matched free in minutes.6. Keep a shopping list for the next panic
Every crash I’ve lived through felt like the end of the world at the time — and every single one turned out to be a sale. Buffett’s most famous rule is to be greedy when others are fearful, and he’s got $397 billion ready to prove he means it.
You can do the same on a smaller scale. Keep a list of the stocks and funds you’d love to own cheaper — one of several moves worth making when you’re worried about a crash — so when everyone else runs for the exits, you know exactly what you’re buying.
The bottom line
Here’s the thing about Buffett’s $397 billion: he’s not predicting a crash, and neither am I. He’s just refusing to overpay — and keeping enough cash to pounce when everyone else can’t. That’s not fear. That’s discipline.
You don’t need $397 billion to do the same thing. You need a little cash set aside, a little diversification, a plan you won’t abandon at the first scary headline, and the patience to let time do the work.
I’ve watched that boring formula quietly mint more millionaires than any hot stock tip ever did.
Sources: CNBC (1); Yahoo Finance (2); GuruFocus (3); Federal Reserve (4).
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