Here is why Warren Buffett will not buy iPhone 7
His company Berkshire Hathaway recently bought $1 billion worth of Apple stock. However, as per reports, the decision to invest was made by one of Buffett’s lieutenants, and not by the billionaire investor himself.
Buffett is known for being averse to investing in technology companies but his fund managers are reported to take their own calls.
What is more, Buffett’s last known cell phone is a flip phone, which he displayed in an interview to a TV channel in 2013.
Buffett has been quoted as saying: "’Price is what you pay; value is what you get. Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down." Clearly value for money is Buffett’s motto and the iPhone 7 is definitely not ‘marked down’.
Further, Buffett does not feel that great businesses should be bought at any price.
‘Great’ phone at a high price
He has been further quoted as saying: "For the investor, a too-high purchase price for the stock of an excellent company can undo the effects of a subsequent decade of favourable business developments."
So should you be buying a ‘great’ phone at a high price?
Comfort for a year
With Rs 60,000, the starting price of iPhone 7, you could do a lot of other things such as running your room and/or car air-conditioner the entire summer without stinging. You could buy comfort for the entire year depending on your usage.
You could invest the amount in a tax saving instrument under Section 80C and get tax relief equal to a maximum of 30 per cent of Rs 60,000 if you are in the 30% tax bracket. This way you would be getting returns on your money plus saving tax.
High-end electronic gadgets depreciate the fastest. In a few years time this model would be half obsolete. So look at buying it only if you just can’t do without the unique features offered by the iPhone 7. Ponder some more of Warren’s wisdom: "If you buy things you do not need, soon you will have to sell things you need."
If you are looking at getting value for money check the market for other phones which offer good features at lower prices.
Finally, if you do decide to go for the iPhone 7 it would be advisable to insure it immediately after purchase and enable anti-theft mechanisms/apps.