Warren Buffet is an investment genius. He is one of the most successful investors in history. With an estimated fortune of $72 billion, Warren Buffett is one of the richest men in the entire world. He was the most successful investor of the 20th century. Buffett is the chairman, CEO and largest shareholder of Berkshire Hathaway, and consistently ranked among the world’s wealthiest people.
Warren decided at the age of ten, after falling in love with the ideas of investing and compound interest, that he was going to become an investor and be a millionaire by the age of 35. From that point, he developed daily habits that became his work, when he finished his schooling. With his lifestyle and work being synonymous, it’s hard to tell where the work started and stopped.
He began working at his father’s brokerage, Buffett-Falk, selling stocks as what he called a “prescriptionist”. It was work designed around the idea that the more stocks he sold the more commissions he brought in for the company. He hated it. Buffett’s preference was to find stocks that he could tell people to buy and not touch for twenty years – like his early investments in GEICO.
In the excellent biography of Buffett by Alice Schroeder, is this passage:
It must have stunned people at Buffett-Falk to watch him, morning through night, ripping through the manuals, adding to his file cabinets of knowledge. “I went through the Moody’s Manuals page by page. Ten thousand pages in the Moody’s Industrial, Transportation, Banks and Finance Manuals—twice. I actually looked at every business—although I didn’t look very hard at some.”
Schroeder, Alice (2008-09-29). The Snowball: Warren Buffett and the Business of Life (Kindle Locations 3209-3212). Bantam. Kindle Edition.
He soon moved to Graham-Newman, where he had more freedom to do things his way. Graham was a mentor for Buffett. But Graham soon retired and Buffett decided to leave and strike out on his own and form a partnership. Schroeder writes:
It was possible that he did not think of this as having a “job.” In fact it was a near-perfect way of not having a job. He would have no boss, could invest from his house, and could put friends and relatives into the same stocks that he would have bought for himself. If he took a quarter of every dollar he earned for these partners as a fee and then reinvested that in the partnership, he could be a millionaire much faster.
Schroeder, Alice (2008-09-29). The Snowball: Warren Buffett and the Business of Life (Kindle Locations 3847-3850). Bantam. Kindle Edition.
In an interview with Caroline Ghosn, cofounder of women’s careership startup Levo League Buffet spoke at length on how he works and his work ethics.
Here’s an excerpt from the Fast Company piece:
Throughout the interview, Buffett talked about how Berkshire Hathaway was his canvas, one that he got to paint on every day. He doesn’t need to work, he says, but does because he loves it. This is the same alignment he looks for in the people he surrounds himself with, he says. When you work with people who are already rich, they’ll work because they choose to do so, “rather than being on a yacht somewhere.”
But you don’t have to be rich. Buffett says that while it may take a job or two to get there, you should do the work you love.
“Just imagine you could be given 10 percent of the future earnings of one person you know,” Buffett says. Would you pick the smartest person? The fastest runner? No, Buffett says: “You’re going to pick the person that has the right habits.”
The qualities that you admire the most in others are the ones that you should develop in yourself, like cheerfulness, generosity, and giving credit to others. If you look at the natural leaders, Buffett says, they’re the people you want to work with. So you, then, can become that.
Bottom Line: “Find the job you would have if you were independently rich. Associate with people you love doing what you love,” Buffett says. “How can it be any better?”
Here are some of Warren Buffett’s money-making secrets — and how they could work for you.
Reinvest your profits: When you first make money in the stock market, you may be tempted to spend it. Don’t. Instead, reinvest the profits. Warren Buffett learned this early on. In high school, he and a pal bought a pinball machine to put in a barbershop.
With the money they earned, they bought more machines until they had eight in different shops. When the friends sold the venture, Warren Buffett used the proceeds to buy stocks and to start another small business. By age 26, he’d amassed $174,000 — or $1.4 million in today’s money. Even a small sum can turn into great wealth.
Be willing to be different: Don’t base your decisions upon what everyone is saying or doing. When Warren Buffett began managing money in 1956 with $100,000 cobbled together from a handful of investors, he was dubbed an oddball. He worked in Omaha, not Wall Street, and he refused to tell his parents where he was putting their money. People predicted that he’d fail, but when he closed his partnership 14 years later, it was worth more than $100 million.
Instead of following the crowd, he looked for undervalued investments and ended up vastly beating the market average every single year. To Warren Buffett, the average is just that — what everybody else is doing. to be above average, you need to measure yourself by what he calls the Inner Scorecard, judging yourself by your own standards and not the world’s.