Warren Buffett: Teachers and nurses don’t get rewarded like investors do. Small ‘tangible’ steps to take towards your first $1M

“There's always plenty wrong with a social order, and certainly there are places where ours is a lot more broken than it used to be … but wishing for a million dollars instead of some more tangible short step is the wrong frame of mind,” Munger said. “That isn’t the way we got our million dollars.”

Buffett’s reply noted the realities of modern capitalism.

“There is a tremendous amount of inequality,” Buffett said.

“The market system does not reward teachers, does not reward nurses — I mean, it does not reward all kinds of people who do all kinds of useful things in any way comparable to how it will reward entertainers, or people who can figure out the value of businesses, or athletes or that sort of thing.”

Buffett pointed out the importance of appropriately taxing those with incredible wealth, like he has, in order to ensure those whose skills are not richly rewarded by capitalism are still taken care of.

“I do think that it’s incumbent on the people that do very well under that system to be taxed in a manner that takes reasonable care of anybody that is not well-adapted to that system,” he said.

Despite his acknowledgement of the massive economic disparity that benefits him and those like him with “enormous rewards” for their particular skill sets, he still agreed with Munger.

“Wishing for the million dollars … you know it just doesn't work that way and, I think, if you’re lucky enough to have something that this market system rewards, you do very well here.”

While there are many more careers that capitalism doesn’t recognize compared to those it "enormously rewards," a strong saving and investing strategy can make it possible for some to eventually achieve millionaire status. After all, as Munger pointed out, neither guru started out with a million dollars.

Tangible steps to reach your first million

If your career doesn’t pay six figures — which is true for the majority of Canadians — there are still concrete steps you can take to build wealth over time. Neither Buffett nor Munger started out wealthy, and both repeatedly stressed that wealth usually comes from small, consistent decisions and actions.

You need a budget

It all starts with budgeting. As Munger often pointed out, you can’t invest if you’re spending everything you earn. A budget helps you understand where your money goes, identify waste and free up cash so you can invest.

Budgeting can be harder than it sounds. According to recent data from the National Payroll Institute, almost one-third of Canadians who earn more than $100K annually report living paycheque to paycheque (2). Further, according to a 2025 RBC poll, almost half (47%) of the respondents reported living “bill to bill,” and having to dip into their retirement savings to make ends meet in the face of rising costs (3). When everything feels tight, even freeing up $100 a month for investing can be a meaningful first step.

The goal isn’t for you to micromanage every receipt — it’s to create a spending model that allows you to live below your means on purpose. That gap between what you earn and what you spend is what funds wealth-building.

Based on your personality, there are various ways to budget:

• Zero-based budgets: Gives every dollar an assigned purpose.
• 50/30/20 budgets: Uses the need/want/save framework.
• Reverse budgets: Pays yourself first into savings, then spends the rest.
• App-based tracking: Offers automatic categorization and alerts.

The specific method you choose matters less than your commitment to it. Without this foundation, the most important next steps — investing and compounding — never happen.

Make consistent low-cost investing a default setting

Once you understand your monthly budget and have extra savings to invest, the next step is to follow a simple, low-fee investing strategy you can stick with. Buffett recommends automating your finances so that a certain amount of your paycheque is automatically invested in low-cost index funds every time you are paid. He has also argued that most people shouldn’t try to pick stocks. Instead, they should buy a low-cost basket of the market and hold it for decades.

“The goal of the nonprofessional should not be to pick winners, but should rather be to own a cross-section of businesses that in aggregate are bound to do well,” he wrote in a 2013 Berkshire Hathaway shareholder letter. “A low-cost S&P 500 index fund will achieve this goal (4).”

Options for you to put that advice into practice include:

• Open a self-directed investing account such as a Registered Retirement Savings Plan (RRSP), Tax-Free Savings Account (TFSA) or a non-registered account.
• Set up automatic contributions each payday.
• Invest in ETFs or low-cost funds.
• Leave it alone long enough for compounding to do the work.

Yet, many Canadians aren’t taking full advantage of registered accounts. Most recent data shows only about one-third contributed to an RRSP in 2022, with the median contribution at only $3,910 — far below what’s needed to build meaningful retirement savings (5).

To help solve this, automation and consistency can add to your savings power. Setting your chequing accounts to make automatic withdrawals to your registered accounts — even in the smallest amounts — adds to your nest egg over time without you even seeing it. And, if you want even less decision-making, robo-advisors can automate your portfolio design, offering rebalancing and risk-management for a modest fee.

Diversify with real estate on easy mode

Charlie Munger built much of his wealth through real estate early in his career, often reminding investors that the real payoff came from letting time do the heavy lifting. As he put it, “The big money is not in the buying and the selling, but in the waiting,”

Traditional real estate investing — buying property, being a landlord, managing repairs and vacancy — can be effective, but it takes time and energy to oversee. Not everyone wants to deal with tenants, maintenance and large mortgages.