Credit

• Buffett advises people who are college-student age to avoid credit cards. First, the cards promote wasteful and impulsive spending. Second, rates are too high, and so the convenience comes with a high price. Third, credit cards do not look or "feel" like money, so they are easier to use without considering that they are money in every sense of the word. Buffett advises using cash and budgeting wisely. Discipline lies at the root of personal money management.
  
  

Stocks

• Buffett advises investors at all levels to "buy what you know." When you purchase stock, do not just buy what you think might rise, or what might take off. Buy from firms that you are familiar with, and that have a long track record of returns. For these kinds of stocks, research is easy; go with what has worked for a long time. Read the stocks' paper trail and find out what is high and what is low for that firm. Buy accordingly. Do not go for the latest fads or gossip. Go for what has worked in the long term, and always keep the long term as your main benchmark for any investment.
  
  

Business

• A good firm, one worth investing in, commands loyalty. It has a popular brand name; this recognition is one of the keys to business success. A "value foundation" is central to Buffett's general economic approach. This concept is close to the idea of a long term, established firm as the basis of both a good investment portfolio as well as a stable economy. A "value formation" differentiates a "good" company from a "fly-by-night" venture. The latter, though quite capable of making short-term profits, is too risky. Your best bet, as Buffett never tires of saying, are those firms with a solid value foundation of long standing.
  
  

Freedom

• "Value foundation" is central because it is a measure of a firm's "freedom." Freedom here is in a technical sense; it refers to the amount of wiggle room a firm might have. A firm that is strong, with a great investor base and customer loyalty, is free. That firm can adjust prices depending on inflation or the market, and not suffer too much as a result. A firm is not free when it cannot do this. Often, a firm cannot do that when it lies on such a flimsy investor base that any risk, even a small one, could lead to financial disaster. This is the basis of figuring a firm's solidity and foundation.