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25 Lessons To Learn From Warren Buffett

Warren Buffett is the personification of consistent success. He is one of those perspicuous business magnates who not only wins over people for his success and intelligent but also for his values and modesty. Born in 1930, he showed immense interest in the stock market at the very young age and made his first investment in the age of 11. To this date, he is considered one of the best investors in the world. Here are a few things you can pick up from this eminent personality

25 Lessons to Learn from Warren Buffett

Investment

  1. Choose Ideas

“I try to buy stock in businesses that are so wonderful that an idiot can run them because sooner or later, one will.”

Warren Buffett makes an important statement when he says that you should analyze how viable, moral and perspective the idea is and then make an investment knowing that no matter who propagates and manages the business, the idea remains evergreen and ever-growing.

  1. Focus on the right thing

Your value is not determined by your current status, it lies in how alert you are and how you tune your future based on your past and present. Knowing something doesn’t work should push your focus on trying the next best thing rather than the failure itself.

  1. Simplicity is the ultimate sophistication

If this saying by da Vinci applies in an art which is as abstract as can be, then truly it can be applied in life! Buffett believes that investments have to be made on ideas you understand thoroughly. Any change – ups or downs – by no means should surprise you. Use automated quantitative models only if you do understand them completely!

  1. Today is as important as yesterday

It is true that history has a lot of advice to offer and Warren welcomes it. But he says that that is not the complete knowledge you require. While we must never make the same mistakes that have happened in the past, one must always understand current trends, strategies, and valuations in the fast changing world.

  1. Time rather than timing

Starting to save money early makes sure that you can keep investing it over and over for years. Rather than waiting for the perfect time to invest in a great business, starting early gives you the advantage of having more to invest and multiply. You do the math. Get more ideas on planning the timing by reading this Plan for Next 5 Years 

  1. On diversification

“Keep all your eggs in one basket, but watch that basket closely.”

When it comes to stocks, plenty of people tells you to diversify your investments across verticals. This is good for beginners as they can make a profit out of one thing if the other reels into a loss. However, ultimately, we are keen on getting growth and not just equalizing profits and loss. Buffett believes that if you know what you are doing, you should go full in with confidence!

  1. Popularity means nothing

When everyone is busy caught up in fads, it is not necessarily that they are right. Mistakes happen even in a democracy! You can never catch Warren invest in a business just because everyone else thinks it is an industry that would grow. You should do a thorough check of the longevity of it because what comes fast goes fast.

Traits

  1. No one can afford to be impulsive

Buffett encourages everyone to spend a time to just sit and think. You cannot revert the choices you make in life and if you have to live with a bad move, there should at least be some rationale behind it. Being impulsive can lead to a lot of bad decisions which ultimately hurts in retrospect.

  1. Enjoy your job

Although he has lived a great number of years, Warren believes that life is too short to waste on things you do not like to do. You should always arrive at a perfect balance between your responsibilities and what you like to do. Always work to get there!

  1. Communicate effectively

If one cannot afford to make mistakes, the first step is correct communication. Buffett was initially nervous when it came to public speaking. Knowing that it was an inevitable necessity for the career he has chosen, he took steps to hone his speaking skills by enrolling in courses and practicing.

  1. Maintain work-life balance

“Money can’t change how many people love you or how healthy you are.”

Always recognize that work is meant to wealth and happiness but never decide that is enough. Everyone has familial, social and personal responsibilities and time and effort have to always be spent on them. What is all the wealth for if you aren’t focussing on the right things?

  1. Practice frugality

“If you buy things you do not need, soon you will have to sell things you need.”

What good is money earned if it cannot be spent, a lot may think. Warren believes that if you have more money than needed for a minimal lifestyle, you can stop working for money and make money work for you. Instead, if you insist on being a spendthrift because you can, you can never assure yourself of a safe future.

  1. Don’t be a one-man bank

Living on borrowed money is a blessing in times of adversity. But that’s the only time you are allowed to use the blessing. Borrowing more than you need to meet your future goals is never wise. He also does not encourage lending money a great practice. But if you rely on to money you have lent, it is but a foolish risk. If you have to part with your money, it should be a donation and you should have no ties with it once it is out of your hand.

  1. Be your own judge

Look at who you are juxtaposed with who you were yesterday. That is the only comparison you should ever make about yourself. Everyone has their unique interests and standards. Judging yourself by others expectations is a fool’s choice. You can also have a look at this Leadership Qualities

  1. Be patient

If you have the confidence that you are going in the right direction, you might as well be patient to see the results bloom. Who knows, it may even be better! Expecting immediate gratification just because the world is increasingly fast-paced doesn’t make sense. No matter how advanced we become, a baby always takes nine months to be born.

  1. Plan wisely and execute expertly

Ensuring that your goal is carefully designed, you need to make a viable and fool proof plan. Only when you trust your plan completely, you must execute it. Any deviation when you execute your plan must be treated seriously and must have proper justification.

Values

  1. A life of philanthropy

Always glowing brightly in the list of the richest people in the globe, you can imagine what all he could do with that money! Buffett is a true philanthropist, has pledged 99% of his wealth for philanthropic causes. He is part of the renowned ‘The Giving Pledge’ where billionaires promise a huge share of their wealth for the greater good.

  1. Give value to money

His idea is to leave his lineage with as much as they would need to achieve their ambitions and donate the rest. This shows that having immense wealth beyond imagination doesn’t cloud him or deprive him of losing the value he has for money.

  1. Make friends with the honest

Buffett claims that honest people are seldom found. Such people who never wear masks are the purest of souls and one should never miss a chance to acquaint themselves with such people. Friendship defines a person and you can always choose the best people so you can pick their qualities up.

  1. Invest in yourself

Warren compares his body to a car and says that if you knew you’d have only that car for a lifetime, the way you’d care for it would be tremendous and it applies to the human body as well. Strong and going in his late 80s, he has proved to be a man of his words.

  1. Respect women

He always believed that his sisters were better and more skilled than he was but they were never given the same opportunities. But no one else seemed to look at this the way he did and expectations set on women were lower back in his days. He recognizes that this era is different and it should ensure that equal opportunities are available to women.

  1. Value your relationships

Be it your friends, colleagues, family or community, you must always know what has made you the person you are and value the contribution made by whoever has surrounded you. Buffett started off as a newspaper boy for The Washington Post and he still maintains a very cordial relationship with the company.

  1. Establish a strong faith in yourself

When adversity hits hard and you have to deal with failure, you need just enough faith in yourself to know that is it not the end, that the sun will rise again. Trying to look at the bright side, learning from the mistakes or even seeing opportunities in the event can improve you as a person.

  1. Hold your head high

One of the firmest values Buffett holds is his reputation. He believes that even a shred of it lost tarnishes a person for life. This especially holds with the people who have a lot of freedom and do not care much about integrity. The way you want others to remember you should be your motivation to be on the right path.

  1. Stay strong

Sometimes, it is not your fault. Buffett was diagnosed with prostate cancer and that did not stop him from continuing his work. The only way you can react to things, not in your control is staying strong!

With these lessons learned from an exceptional man, you can be sure to go to bed a wiser person than when you woke up.

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