The Warren Buffett Factor — What the Mega Rich Do Differently From Us Lowly Peasants
It’s a lot simpler than what we realize
I often wonder about the lives of the mega rich. I’m talking about Bill Gates, Warren Buffett and Jeff Bezos. Apart from the fact that they’re all above the age of 50, grew up in different times, under different pressures, societal expectations and types of information available — there are some hard tried and true habits and modes of thinking that works regardless of environmental and societal factors.
A Habit of Learning
“You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever.”
— Steve Jobs
It turns out Warren Buffett spends around 5 hours a day reading. Not your TMZ or Buzzfeed kind of ‘reading’ — but the old school, fact based kind of reading.
Bill Gates churns through around 50 books a year. Even Mark Zuckerberg (who happens to still be in his 30s) finishes a book or two every other week.
They’re always learning. They’re always reading. They’re always creating dots for themselves to connect in the future. I guess it’s a game of dots. The more dots you have, the more choices and chances you have of connecting them up to make something successful out of them.
The more they read. The more they learn. They more they have to play with when the opportunity presents itself.
A Habit of Ruthlessly Saying No
Time is money — or so the saying goes.
And there is a certain truth to it. We all have 24 hours in the day — no matter where you are, who you are, who your parents are or how much money you’ve got in the bank. How you chose to spend those 24 hours will determine how your life plays out.
Many of us don’t think of time as a commodity that can be invested for concrete returns. We just think of time as well…time. We have x number of hours available and we divy it up for commute, food, social media and Netflix. After all that, there isn’t really much of it left for anything else in particular.
The difference between the mega rich and us lowly peasants who are just taking it day by day is that they’re investing their time for the reward of delayed gratification.
“The successful among us delay gratification. The successful among us bargain with the future.” ― Jordan B. Peterson (12 Rules for Life: An Antidote to Chaos)
No one really knows for sure if Bill Gates turns on his (probably) 110 inch 4K HD TV to watch Animal Planet. But what we do know is that he ruthlessly protects his time and prioritize what is important to him. Rather than spending it the ‘normal’ way, he (along with all the other millionaires and billionaires that everyone wants to talk to) invest time into the things that truly matter.
In order to do this, they practice the art of saying no. A single person can’t be everywhere and do everything. They either delegate or get rid of the time sinks that quickly turn into sunk costs.
A Habit of Keeping Things Simple
Warren Buffett writes down in schedule in a little pocket book. Being 88 years old might be a contributing factor to his aversion to using technology to aide him in his daily life. My dad struggles with technology too (sometimes).
But don’t be fooled.
There are so many productivity apps, methods, gurus, advice and anything else you can imagine out there — but a majority of us is still inefficient. We make digital lists, over complicate and do a million things other than the thing we’re supposed to be doing.
During my University years, I managed to come out with a conjoint bachelor’s degree, each with double majors attached. I was lucky that I owned an old Nokia from the early 2000s — which meant that my activities were limited to texting, calling people and retro puzzle games (if I ever got bored enough to play it on the bus). There were no apps, no Facebooking, no Instagraming, no of what we can easily categorize as the vices of technology.
I kept a single book for all my notes, assignment due dates, plans and anything else that my brain needed to offload. It worked for me.
Even years later and working in the tech industry as a web developer, I still gravitate towards the book method to keep my schedule, tasks and everything else I need to do under wraps.
There is already enough complexity in life and in the world. Keeping the things you can control as simple as possible frees up the mental load of an overfilled schedule.
A Habit of Consistent Focus
Yes. That’s right. They pick a handful of things and stick to it. They learn the subject, the practice, test, make mistakes and learn. They don’t jump ship or dart around picking up the best next thing.
They do their own thing and keep at it.
They use what we commonly know as the Warren Buffett’s 5/25 Rule.
If you haven’t already heard the story, the tale goes that one day Buffett was hanging out with his pilot (as any billionaire would) and asked him about his life goals and ambitions. He got the man to write down 25 things he wanted to do and then rank then in order of importance.
He then asks the man to circle his top five and what he’s going to do with the other 20. The man’s answer went something along the lines of — “Well the top five are my primary focus but the other twenty come in at a close second. They are still important so I’ll work on those intermittently as I see fit as I’m getting through my top five. They are not as urgent but I still plan to give them dedicated effort.”
Doesn’t it sound like what 99% of us will do?
At this point, Buffett points out the flaws in his plan and told him to avoid the rest of his list and only focus on his top 5.
Why? Because your odds of achieving what you want improves when you consistently direct your focus at a single pursuit. You rack up the hours needed to be an expert. You become a master at your field. You get so good at what you do that you rise above all the other mediocre people out there.
When you consistently focus on a goal, you rack up compounding returns.
Jeff Bezos didn’t become the richest man on earth in a day. Neither did Warren Buffett, Bill Gates, Mark Zuckerberg and everyone else that’s on the billionaire’s list.
To sum it all up…
The rich get rich not because they are rich. They get rich because they’ve figured out the habits required to get rich. They practice it. They live it. They preach it. They breathe it.
Many of us live the 9–5 and do the same things that everyone else is doing — yet wanting to achieve some sort of financial and time freedom without changing the way we exist.
If you want change in your life, you’ve got to make changes in your life. The habits listed here are a starting point. It’s ultimately your choice if you want to take them up or not.