Warren Buffett gave $10K to his daughter-in-law each year, but she spent it to the dime. 4 ways to use your own windfall

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Warren Buffett is known for his generosity — but also his frugality.

That might be why he pulled the plug on large cash gifts for his family after learning they were blowing through the money as quickly as they got it.

In a 2019 ThinkAdvisor interview, Buffett’s former daughter-in-law, Mary Buffett, recalled when he would gift her $10,000 in hundred-dollar bills (1). She reminisced, “As soon as we got home, we’d spend it — whooo!”

As the king of investing — not spending — however, the former CEO of Berkshire Hathaway soon decided the gift of shares would be a better investment for his family’s future.

According to Buffett’s three children — Susan, Howard and Peter — they were raised in an upper-middle-class lifestyle despite their father’s growing wealth. In a 2026 CNBC interview, they shared that they took the bus to public school, did chores to earn their allowance and all had jobs (2).

“We grew up expecting nothing, to be honest,” said Howard.

But the Buffett heirs said they’re grateful for what they consider a normal childhood.

“We were certainly very fortunate,” Susan emphasized. “We didn’t need anything.”

In a 2024 letter to Berkshire shareholders, Buffett expressed admiration for his adult children’s perspective (3): “They enjoy being comfortable financially, but they are not preoccupied with wealth. Their mother, from whom they learned these values, would be very proud of them. As am I.”

While you may not have a rich relative, you might be lucky enough to come into some cash, as Buffett’s family once did. Follow these tips to use it in a way the Oracle of Omaha would approve of.

One of Buffett’s core principles is the power of compounding — where you can earn returns on both your initial investment and its accumulated growth. For example, had Mary invested her $10,000 and allowed it to grow at a 4% monthly compounded rate for 10 years, it would have grown by nearly 50%.

Believe it or not, rates like this are relatively easy to find — and can help take the sting out of inflation.

A high-yield account like a Wealthfront Cash Account can be a great place to grow your uninvested cash, offering both competitive interest rates and easy access to your money when you need it.

A Wealthfront Cash Account currently offers a base APY of 3.30% through program banks, and new clients can get an extra 0.75% boost during their first three months on up to $150,000 for a total variable APY of 4.05%.

That’s 10 times the national deposit savings rate, according to the FDIC’s March report (4).

Additionally, Wealthfront is offering new clients who enable direct deposit ($1,000/mo minimum) to their Cash Account and open and fund a new investment account an additional 0.25% APY increase with no expiration date or balance limit, meaning your APY could be as high as 4.30%.

With no minimum balances or account fees, as well as 24/7 withdrawals and free domestic wire transfers, your funds remain accessible at all times. Plus, you get access to up to $8M FDIC Insurance eligibility through program banks.

Read More: Robert Kiyosaki warned of a ‘Greater Depression’ — with millions of Americans going poor. Was he right?

Beyond saving, another way to take advantage of compound returns is by investing.

While investing comes with more risk than a high-yield account does, it can also lead to higher returns. That’s why when Buffett started gifting his family shares instead of cash, Mary Buffett wisely chose to retain her gifted shares rather than cashing them out.

But you don’t need a $10,000 gift from Warren Buffett to invest in the market.

SoFi’s easy-to-use DIY investing platform lets you buy stocks, ETFs and more, with no commission fees and no account minimums.

SoFi is designed for both beginners and seasoned investors, with real-time investing news, curated content and the data you need to make smart decisions about the stocks that matter most to you.

Plus, for a limited time you can get up to $1,000 in stock when you fund a new account.

Online brokerage platforms like this allow you to invest in not only your favorite stocks, but also slow and steady solutions like ETFs or index funds.

In 2012, Warren Buffett told CNBC that if there were a way to buy thousands of single-family homes at once, and to manage them easily, he would “load up.” He also emphasized he’d take out mortgages at “very, very low rates (5).”

But not everyone can purchase multiple properties, nor can they tap into low mortgage rates. After all, the average rate for a 30-year mortgage was just 3.98% in early April 2012 — but as of early April 2026, that rate is up to 6.37% (6).

There are, however, ways to invest in real estate and avoid some of the downsides of the market.

Consider mogul, a real estate investment platform that offers fractional ownership in blue-chip rental properties. This gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or 3 a.m. tenant calls.

Founded by former Goldman Sachs real estate investors, the mogul team handpicks the top 1% of single-family rental homes nationwide for you. Simply put, you can invest in institutional quality offerings for a fraction of the usual cost.

Each property undergoes a vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18.8%. Their cash-on-cash yields, meanwhile, average between 10% and 12% annually. Offerings often sell out in under three hours, with investments typically ranging between $15,000 and $40,000 per property.

Every investment is secured by real assets, not dependent on the platform’s viability. Each property is held in a standalone Propco LLC, so investors own the property — not the platform. Blockchain-based fractionalization adds a layer of safety, ensuring a permanent, verifiable record of each stake.

Getting started is a quick and easy process. You can sign up for an account and then browse available properties. Once you verify your information with their team, you can invest like a mogul in just a few clicks.

Another reason Buffett shifted away from cash gifts may be that their value erodes over time.

Gold, on the other hand, grew in value by more than 58 times between 1910 and 2016 (7). And that’s before 2025’s historic bull run ended in a spot price well over $5,000 per ounce in early 2026 (8). Historically, the precious metal has acted as a hedge against inflation, and many consider it to be a more secure place to invest and protect their wealth.

One way to invest in gold that can also provide significant tax advantages is to open a gold IRA with the help of Priority Gold.

Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, which combines the tax advantages of an IRA with the protective benefits of investing in gold — making it an attractive option for those looking to potentially hedge their retirement funds against economic uncertainties.

To learn more, you can get a free information guide that includes details on how to get up to $10,000 in free silver on qualifying purchases. Just keep in mind that gold is often best utilized as one part of a well-diversified portfolio.

In addition to gifting shares to his family during his lifetime, Buffett also made provisions for his loved ones after his death.

His recommendation? “Leave the children enough so that they can do anything but not enough that they can do nothing (9).”

Whether or not you agree, you’ll want to make sure your own wishes are honored. One way to do so is by getting your will in order. Another is to consider life insurance to keep your loved ones financially protected in the event of your passing.

If you want to ensure your family isn’t hit with unexpected costs after your death, consider signing up for term life insurance from Ethos.

The platform offers simple and affordable coverage for a set period of time — typically between 10 and 30 years. As a licensed third-party insurance administrator, Ethos has joined forces with some of the industry’s top insurance carriers, such as Banner Life, TruStage Financial and Ameritas Life Insurance.

Ethos also gives you the flexibility to select coverage amounts ranging from $2,000 to $100,000. Premiums start at just $9.80 a month and are guaranteed throughout the term.

You can get coverage in just 10 minutes online or by phone, with no medical exams or blood tests required.

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ThinkAdvisor (1); CNBC (2), (5); Berkshire Hathaway (3), (9); FDIC (4); Federal Reserve Bank of St. Louis (6); United States Gold Bureau (7); APMEX (8)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.