Warren Buffett's Top 10 Rules of Success

Warren Buffett's Top 10 Rules of Success

He is one of the most successful investors, philanthropists, and business tycoons,s and also a billionaire worth over $70 billion. Since 2017, Warren Buffett is considered the second richest man in the world and is famous for his investment advice and strategies.

Many people model his success and want to learn his strategies to build massive wealth. And in this article, you will discover Warren Buffett's top 10 rules for success.

Buffett was born in Omaha, and he developed an intense passion and interest in business and investing in his youth. He was a graduate of Columbia University and he learned his investment philosophy from another great investor, Benjamin Graham, famous for his principle of value investing.

The company that Buffett runs, Berkshire Hathaway, owns more than 60 companies, including Geico, Dairy Queen, and Duracell. While most young people have a good time playing games, Buffett started his career as an investor. He bought his first stock at age 11 and filed a tax return at age 13.

Along with his best friend Bill Gates, the richest man in the world, they both launched The Giving Pledge, asking billionaires to donate their wealth and Facebook founder Mark Zuckerberg was one of them. Buffett believed in giving back and pledged to donate over 99% of his fortune to charity. To date, he has given nearly $32 billion to charity.

So how was Warren Buffett able to produce such an amazing outcome in his life, amassing massive wealth and also creating outstanding success in his investing career? Well, he has a certain set of principles and philosophies when it comes to making a decision, investing, running a business, and also succeeding in life. And its principles of success can be summed up with the top 10 rules below.

1. Find your passion

Almost all successful people agree that finding and following your passion is important if you want to produce an amazing result in life. Warren Buffett is also convinced of this. During an interview, he confided that he had been lucky enough to be able to discover what he liked to do from an early age. And he said once people find their passion, their life will change.

There's no guarantee you'll be able to find your passion in your first job, but you have to keep digging until you find it.

Passion is the only way to produce exceptional work. Without passion, you will do things with a half-hearted approach and there is no way to become the best that way. So, find your passion, do what you love, and you can produce incredible success in life when you do.

2. Recruit well

If you want to be a billionaire, you can't do it alone, you have to have a good team. And to have a good team, you have to learn how to recruit well. Always remember that you cannot succeed in this world alone. You need the help of others to bring you the success you want. And your employees will be your greatest assets.

Buffett, he emphasizes 3 qualities when hiring, and they are integrity, intelligence, and energy. Buffett also said that out of these 3 qualities, integrity comes first. He also jokingly said that you don't want to hire someone who has no integrity but has a lot of intelligence and energy. Integrity comes first. Without integrity, other qualities don't matter.

Buffett is also famous for his saying, "It takes 20 years to build a reputation and five minutes to ruin it." He firmly believed that if you want to build a billion-dollar company, you have to hire someone with integrity. This is because people have to manage money in business. And if you hire people who have no honesty, a lot of problems will arise.

3. Don't care what other people think

Buffett's third rule of success is that he doesn't really care what other people think. And this is extremely important because if he wants to consider what others have to say, his decision will be influenced and he will never be able to cling to his investment principles. If Buffett were to listen to what others were saying, he would become like most people, living an average life rather than living like a billionaire, and become such a successful investor.

The same goes for you. When it comes to achieving the success you want and living your dreams, there will be people who will tell you that it is impossible to achieve what you want and simply suggest that you get a real job. . Never listen to the opponent.

Warren Buffett is known for the concept of the "circle of competence" which he used as a way to focus his investment in operating only in the areas he knew best. The concept basically explains that each of us has developed useful knowledge in certain areas, and what we need to do is operate in those areas that we are good at. So ignore what others have to say about the rest.

It is human nature to want to be assimilated and accepted by others. However, this will cause you to worry too much about what other people think and say about you. It will also prevent you from living your best life on your own terms. When you care too much about what other people think and say about you, you will restrict your own freedom and always be their prisoner.

4. Read, read, read

It said that this billionaire reads about 5-6 hours a day and also reads about 6 newspapers every morning. The more you read, the smarter you will become and the more knowledge you will get.

Your skill will help you make better decisions that will lead you to success.

Before investing in businesses, Buffett often read Benjamin Graham's "The Intelligent Investor.". Successful people are great readers and you need to adopt the same habit.

Reporters asked SpaceX CEO Elon Musk how he learned to build rockets. And Elon's response was simple, "I read books," he said. By reading, you learn more about the world and become more open-minded.

So commit to reading every day. If you find yourself busy and don't have much time to read, start small and read 15 minutes a day. If possible, go for more. Read for at least an hour a day. You can wake up earlier and make time to read or you can make good use of your commute time to read.

5. Have a safety margin

The concept of “margin of safety” has its origins in the teaching of Benjamin Graham. Warren Buffett, Graham's most successful follower, learned the concept and put it to good use in his investment portfolio.

The concept is easy to understand and Buffett often uses the metaphor of driving over a bridge to explain this concept. When you build a bridge, you insist that it can carry 30,000 pounds, but you only drive 10,000-pound trucks on it. You have a safety margin of 20,000 pounds.

And when it comes to investing, you'll never buy a $50 million company for $60 million. You will buy the company worth $50 million at a lower price than this to ensure a margin of safety. In banking, a bank will never lend you money if you could barely pay the interest each month. The banks will make sure that you have an extra to pay the loan installment in case something goes wrong in the future.

This concept is central to the principle of value investing. It helps investors make better and wiser decisions before they jump into buying a stock. When an opportunity comes your way, evaluate using the concept of a margin of safety before deciding.

6. Have a competitive edge

Buffett said capitalism is someone coming in and trying to take the castle. In the business world, your company must have a sustainable competitive advantage to survive in the long term.

The competition today is tough and people can copy exactly what you do and produce the same product and put you out of business. That's why it's important to have a competitive edge to protect your business like a moat protects a castle. Buffett said he would invest in companies that have a competitive edge because he wants to make sure the company will still be around years from now.

So ask yourself what are you good at? How can you make your product so unique and special that other people can't copy yours? What kind of service you can provide to your customers that can act as your competitive advantage and make your business flourish and become the industry leader?

7. Plan your personality

One of the rules that ensured Buffett's success is that he built his businesses around his personality. Buffett said he doesn't like meetings and builds his businesses the way he wants and loves. He also mentioned that to be successful in what you do, you have to find your rhythm and your sweet spot to enjoy your work and perform at your best.

Buffett loves to read and he chooses to read to improve his knowledge, then he acts as a strategist and runs his business from behind the scenes. And you should do the same if you want to perform at your peak level.

Well, not everyone can be like Warren Buffett and spend 5 hours reading every day, but what you can do is plan your work around your personality. If you like to have a cup of coffee before you start work, do it. Organize your workspace according to your own taste, which will make you more productive. The key is to play to your strength and personality so you can become the best at what you do.

8. Always be competitive

Buffett thinks one of the most common killers in business is complacency. When people fall into their comfort zone and fail to improve their competitiveness, their businesses will eventually fail or be taken over by competitors.

And to stay one step ahead, you always have to compete. Every business has problems in every industry. The key that Buffett believes will make a business successful is its ability to compete and stand out from the crowd. When IBM stock fell significantly, Buffett said IBM didn't perform the way he or management had expected. He also went on to say that IBM is a big and strong company, but it also has a big and powerful competitor. And IBM must improve and innovate to continue to thrive in its business.

Buffett also said Geico had added 700,000 policyholders over the past year, far outpacing receding competitors. And that's why he invested in Geico and the business continues to thrive because they are still in the competition. Therefore, never rest on your laurels, stay competitive, and keep improving and innovating in your business.

9. Success Model

There is no way to succeed alone in this world. If you want to succeed in life, you need others. You need to model other successful people, or better yet, find yourself a mentor. This is why Warren Buffett learned from Benjamin Graham and worked for him as a disciple.

Take a look at the sports industry, every outstanding and professional athlete has a coach. Tiger Woods has a trainer. Michael Jordan has a trainer. Usain Bolt has a coach. You need a coach to guide you on your journey to success. Your coach can also remind you of your goals and encourage you to do your best.

In business, having a mentor is considered one of the most important keys to success. When Steve Jobs started, he learned and received a lot of business advice from Mike Markkula. The same goes for the famous motivational speaker, Les Brown. When Les was young, it was LeRoy Washington who guided and mentored him to achieve the best in his life. Les Brown was called "educable mentally retarded" at school, and one day his mentor, LeRoy Washington, said something to him that changed his life. He said to young Les Brown:

"Don't let never someone's opinion become your reality."

So find yourself a mentor or coach to guide you in your business and in life. Success leaves clues and what you need to do to produce a great result is to model the success of others. Learn and study from others, then improve to become better.

10. Give unconditional love

Finally, Warren Buffett believes that the most powerful force in this world is unconditional love. And it was the unconditional love he received from his father, Howard Buffett, a US congressman, that made Warren who he is today.

Buffett says his father believes in him and supports him in everything he has done. Whatever Buffett has done and no matter how much money he has made, his father will tell him to do his best in whatever he tries. And that is why Buffett believes he is capable of producing amazing results in his life. And he also suggests to anyone who wants to succeed in life to give unconditional love.

While this last Warren Buffett rule of success has nothing to do with a trading strategy, it has a lot to do with your personality and beliefs. As a philanthropist, Buffett believes in the importance of helping society and giving back to the world. He always seeks to help and to give, rather than to take. When you operate with a giving and helping mindset, you put your customers first, and that's what makes a business thrive.

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