Warren Buffett is one of the most admired people in the investing world, and for good reason. He has been at the helm of Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) for close to 60 years, and in that period, has increased the stock’s value at an average annual growth rate of 19.8% — versus 10.2% for the S&P 500 over the same period.

Buffett is also admired by many for giving away many billions of dollars. He’s also generous with his wisdom, frequently sharing his thoughts and advice — such as in interviews and at annual meetings of his unique company, Berkshire Hathaway.

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Here are several savvy things that Buffett has said, each of which can help you become a better investor and prepare for retirement — perhaps becoming a millionaire in the process. They apply in any economic environment.

1. “Risk comes from not knowing what you are doing.”

One of Buffett’s key investing tenets is to avoid losing money, and taking on too much risk can lead to financial losses. Buffett has also spoken often of his “circle of competence,” explaining that he’s always careful to stay within it. That’s why you’re not likely to see him loading up on, say, biotechnology or cybersecurity stocks. (Note, though, that he has two investing lieutenants, Ted Weschler and Todd Combs, who might buy such stocks for the company.)

This quotation should remind us to stick to what we know, too. If you don’t understand how a leveraged ETF works, don’t put any money in it. If you don’t understand how options work, they’re best avoided, too. And always you should understand that trying to time the market is usually futile, and you shouldn’t be trying to do so.

There are gobs of financial mistakes people make. It’s worth learning about as many of them as you can, in order to avoid committing those blunders yourself.

2. “The three most important words in investing are ‘margin of safety.'”

A key principle in the way that Warren Buffett invests is making sure he has a margin of safety. We should do the same, because having a margin of safety means we’re taking on less risk.

Imagine wanting to invest in Home Surgery Kits (ticker: OUCHH), which is trading for $60 per share. If you’ve researched the company and you estimate that it’s worth around $80 per share, you have a margin of safety. If the stock seems to be worth $50 per share, you have no margin of safety, and should the stock retreat closer to its intrinsic value, you’ll have a loss on your hands.

Investors seeking margins of safety are value investors, and they’re aiming to grow their worth without chasing high-flying stocks that could fall back to Earth. They don’t have to find dirt cheap stocks, though — just ones that appear undervalued. As Buffett has also said, in his 1989 letter to shareholders, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.”

3. “Diversification is protection against ignorance. It makes very little sense for those who know what they’re doing.”

This is a particularly intriguing quotation, as Buffett is essentially speaking out against diversification, which most investing guidelines would recommend. He qualifies his thoughts, though, explaining that if you are a savvy investor, it can make sense to have relatively few holdings in your portfolio.

But for most of us, diversification is good — because the majority of us are not the savviest of investors and not super skilled at studying companies. Therefore, spreading our dollars across a wide range of companies can be a smart move — something that can be accomplished by investing in a simple, low-fee S&P 500 index fund.

At his 2020 annual meeting, Buffett said, “In my view, for most people, the best thing to do is to own the S&P 500 index fund.” He has explained that in his will, he has directed that most of the money he leaves his wife should go into a low-fee S&P 500 index fund. He even made a 10-year, million-dollar bet favoring index funds — and won.

These are just a few of the myriad instructive things Buffett has said about investing. It’s worth seeking out more insights from Buffett — and also from the late Charlie Munger, his longtime business partner.

So whether you take the time to learn how to study and evaluate stocks, or whether you just opt for simple — yet very effective — index funds, keep Warren Buffett’s wisdom in mind. He can help you build a sizable nest egg for retirement.

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Selena Maranjian has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.