Legendary investor Charlie Munger—whom Warren Buffett credits with teaching him “all he knows”—stands as an icon for investors and entrepreneurs around the world. Often called “the architect” of Berkshire Hathaway, Munger is best known for his disciplined use of mental models, a toolkit he passed on to Buffett and countless others.
Born into a long line of Nebraskan lawyers, Munger grew up with a firm Midwestern work ethic. Details of his childhood are sparse, but one thing is obvious: he learned the value of hard work early and carried it for the rest of his life.
Despite his family’s relative affluence, Munger’s first job was at Buffett & Son, the grocery store owned by Warren Buffett’s grandfather. He worked there before enrolling at the University of Michigan, where he studied mathematics.
Growing up during the Great Depression left a deep mark on his investment philosophy. Munger embraced the idea of buying “wonderful companies at fair prices.” What counts as “fair” is subject to judgment, but his frugality and skepticism, forged in the 1930s, became permanent features of his worldview.
War, Meteorology, and a Strategic Mind
World War II became a defining chapter in Munger’s life. In 1943, he left school to join the U.S. Army Air Corps, eager to prove himself. The military turned out to be a natural fit: his intellect and strategic instincts quickly set him apart.
“You don’t have to be brilliant, only a little bit wiser than the other guys, on average, for a long time,” he said later. During the war, he rose to the rank of second lieutenant and earned a high score on the Army General Classification Test.
The Army sent Munger to Caltech to study meteorology, where he also sharpened his card-playing skills. Cards, more than clouds, shaped his approach to risk. “What you must learn is to fold early when the odds are against you… Opportunity comes, but it doesn’t come often, so seize it when it does come.”
Meteorology and card games had little to do with his future job title, but they taught Munger the value of probability, discipline, and strategy—skills he would later apply to investing.
From Law to Investing—and Meeting Buffett
After the war, Munger tapped into the G.I. Bill and threw himself into learning. He took advanced mathematics and statistics courses at various universities, constantly expanding his toolkit.
Wanting to please his parents, he set his sights on law. Despite not having a bachelor’s degree, he applied to Harvard Law School. “To get what you want, you have to deserve what you want,” he liked to say. Initially rejected, he leaned on his family’s network to get a second look—and this time, an acceptance. He didn’t waste it: Munger graduated magna cum laude in 1948.
He returned to California and began practicing real estate law, but boredom soon crept in. Remembering the lessons from cards and probability, he turned back to investing. After a few years, he launched the investment firm Wheeler, Munger & Company.
Relationships shaped this chapter of his life as well. On a trip back to Nebraska, he met Warren Buffett. The two bonded over their shared history at Buffett’s family grocery store and their obsession with investing. “I’m not going to find another guy like this,” Buffett thought. “We just hit it off.”
Despite early success, Wheeler, Munger & Company struggled, and after several years of losses, Munger closed the firm in 1976. Looking for a new chapter—and recognizing the power of his friendship with Buffett—he asked Buffett for a role. In 1978, Munger joined Berkshire Hathaway as vice chairman.
Building the “Mona Lisa” of Corporate Conglomerates
The Buffett–Munger partnership has since entered investing lore. The two complemented each other’s strengths, with Munger pushing Buffett toward higher-quality businesses and a more structured way of thinking.
When Munger arrived at Berkshire, he formally introduced Buffett to the idea of mental models and the power of strong habits, something Buffett says “jerked [him] back to sanity.” Buffett later wrote, “[Munger] continued in this role, and together we, along with those who early on invested with us, ended up far better off than Charlie and I had ever dreamed possible.”
Munger’s influence helped shift Berkshire’s strategy. He convinced Buffett to focus on buying excellent companies at fair prices, not just cheap stocks. That gradual evolution helped turn Berkshire into what Forbes has called the “Mona Lisa of corporate conglomerates.”
Using his “latticework of mental models,” Munger championed some of Berkshire’s most famous moves, including the purchase of See’s Candies for $25 million—a deal that has since generated more than $2 billion. He also pushed Berkshire to invest in Japan, opening up yet another profitable chapter.
Munger passed away in 2023 at the age of 99. He is remembered as the “Oracle of Pasadena” and one of the sharpest minds in modern finance. Alongside Buffett, he helped grow Berkshire Hathaway from about $5 billion to $868 billion. At his death, Munger was worth roughly $2.6 billion and had given more than $500 million to charitable causes.
Here are some of the key lessons Munger leaves behind on mental models, deserved trust, humility, and patience.
Lessons from Charlie Munger
1. Use Mental Models to Make Better Decisions
“You’ve got to have models in your head,” Munger insisted. Throughout his life, he relied on what he called “a latticework of models” to tackle complex problems in both investing and everyday life.
One of his favorite approaches was inversion: instead of asking how to succeed, ask how to avoid failing. His famous line, “I wish I knew where I was going to die, and then I’d never go there,” perfectly captures the idea. By focusing on what to avoid, you sidestep many of the biggest risks.
Mental models require humility. You have to accept that you’re human and therefore fallible. Munger learned this through card playing: the goal isn’t to be perfect, but to stay rational when emotions run high. “Being rational is a moral imperative. You should never be stupider than you need to be,” he said.
In practice, mental models help strip away noise and bias, guiding you toward decisions that are consistent, repeatable, and trustworthy—especially when the stakes are high.
2. Build a Life of Deserved Trust
Munger believed that truly successful people and organizations operate inside a web of “deserved trust.” As he put it, “By and large, the people with this ethos win in life, and they don’t win just money, just honors and emoluments. They win the respect, the deserved trust, of the people they deal with, and there is huge pleasure in life to be obtained from getting deserved trust.”
He compared it to the way an operating room functions at the Mayo Clinic: highly competent, reliable people correctly trusting one another. That level of trust doesn’t happen by accident.
Deserved trust starts with being trustworthy yourself—showing consistency, competence, and integrity over time. Munger extended trust to others through vulnerability and a long track record of excellence. He was modest about his contributions but understood when his hard-earned reputation mattered.
If you want to apply Munger’s idea, focus less on extracting quick wins and more on building a foundation of reliability, humility, and strong moral character. Trust is the compound interest of behavior: slow to build, powerful once it starts to accrue.
3. Let Humility and Ethics Amplify Your Influence
Warren Buffett once said of Munger, “Charlie never sought to take credit for his role as creator but instead let me take the bows and receive the accolades…. Even when he knew he was right, he gave me the reins, and when I blundered, he never—never—reminded me of my mistake.”
Munger’s humility wasn’t just a personality trait—it was a strategic advantage. He understood that likeability and ethical behavior make collaboration easier, attract better partners, and deepen trust.
Author Peter Bevelin summarized Munger’s influence as teaching “how to behave in life, the importance of ethics and honesty, how to approach problems but foremost how to reduce the chance of meeting problems.” Munger’s ethics and self-awareness also reinforced his use of mental models: he had a clear sense of his strengths and limitations and used that clarity to check his own biases.
“Good businesses are ethical businesses. A business model that relies on trickery is doomed to fail,” Munger said. For leaders and investors, that’s a reminder that ethics aren’t a luxury—they’re part of the long-term edge.
4. Practice Patience and Think in Decades
“The big money is not in the buying or the selling but in the waiting,” Munger famously said. Investing, in his view, is less about constant action and more about enduring patience.
He preferred to buy high-quality businesses—even at a premium—if they had durable competitive advantages. When those companies grew steadily and reinvested profits at high returns, time did the heavy lifting. Markets eventually reward that compounding.
Munger rejected impulsive, “get rich quick” strategies. He favored deliberate decisions, long holding periods, and the discipline to do nothing when there was nothing smart to do. That mindset doesn’t just apply to portfolios; it applies to careers, products, and companies as well.
For businesses and individuals, embracing a long-term horizon can unlock better opportunities, more consistent performance, and deeper trust from stakeholders who see you aren’t just chasing the next trade.
5. Read Constantly and Learn Across Disciplines
“In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time—none, zero,” Munger said. “You’d be amazed at how much Warren reads—and at how much I read. My children laugh at me. They think I’m a book with a couple of legs sticking out.”
Munger treated reading as a non-negotiable part of wisdom. He believed that wide, continuous reading kept curiosity alive and prevented intellectual stagnation. Like other lifelong learners—from Naval Ravikant to Taylor Swift—he saw reading as a way to constantly absorb new perspectives.
In his view, the best investors didn’t just read finance books. They read biographies—“100 biographies instead of 100 books on investing”—because cross-disciplinary understanding creates richer mental models.
Among his favorites were The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success, Titan: The Life of John D. Rockefeller, Sr., and The Autobiography of Benjamin Franklin. His advice was simple: “Develop into a lifelong self-learner through voracious reading; cultivate curiosity and strive to become a little wiser every day.”
For anyone looking to follow in his footsteps, that may be the most important Mungerism of all.