5 of Charlie Munger’s Most Important Pieces of Advice

Munger believed that to make sound decisions, we need a latticework of interconnected mental models — frameworks drawn from multiple disciplines such as economics, psychology, physics, and philosophy.

“You’ve got to have models in your head… and you’ve got to have multiple models,” he once said.

His philosophy was that great decision-makers don’t rely on isolated facts or a single way of thinking. They pull insights from different fields and connect them to see the world more clearly. Whether in investing, business, or life, a well-developed mental framework helps us interpret complexity and make better judgments.

One of Munger’s favourite problem-solving methods was inversion. Instead of asking, “What should I do to succeed?” he’d ask, “What should I avoid to fail?”

Inspired by the 19th-century mathematician Carl Jacobi’s phrase “Invert, always invert,” Munger used this approach to simplify complex decisions. For example, if you want to live a healthy life, think about what behaviours would destroy your health — such as inactivity, overeating, or lack of sleep — and avoid them.

This backward thinking is equally powerful in investing: by identifying what leads to poor outcomes (like chasing trends or overtrading), we can clarify which behaviours lead to success.

Munger warned against ideological bias and lazy thinking. His rule: You’re not entitled to an opinion unless you can state the opposing argument better than your opponent can.

This mindset, which he shared in a 2007 commencement address at USC’s School of Law, reminds us that wisdom comes from understanding, not echoing. Munger believed that strong opinions must be built on curiosity, discipline, and empathy — qualities often missing in today’s polarised world.

Despite Berkshire Hathaway’s phenomenal long-term success, Munger and Buffett never claimed to predict the market. Instead, they focused on investing in good businesses and holding them long enough for value to compound.

“I don’t make money predicting accurately,” Munger said. “We just tend to get into good businesses and stay there.”

He compared financial forecasts to ancient kings hiring soothsayers to read sheep entrails—a humorous but sharp reminder that the future is unknowable—his advice: ignore short-term predictions and focus on principles that stand the test of time.

If there was one habit Munger credited for his success, it was reading — constantly.

“In my whole life, I have known no wise people who didn’t read all the time — none, zero.”

He viewed reading as essential for developing wisdom and perspective. More importantly, he encouraged people to read widely — beyond their field — to build the broad knowledge base necessary for true understanding. “To the man with a hammer, the world looks like a nail,” Munger often said, warning against narrow expertise.

His final message was simple: be a lifelong learner, stay curious, and strive to be a little wiser each day.