When Warren Buffett visited Columbia University investing class, a student asked Buffett what he could do now to prepare for an investing career.
“Buffett thought for a few seconds and then reached for the stack of reports, trade publications and other papers he had brought with him. “Read 500 pages like this everyday” said Buffett, or words to that effect. “That’s how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it.”
And you know what, he is right. Not many of you will do it.
That’s the haunting part. Not many will do it. The sea of amateurs comes from this failure to faithfully commit to the unglamorous daily effort, but the top performers in any field usually have this in common. They understand the “compound interest effect.” Small, steady consistent accrual over time builds a massive bank.
If you aren’t contributing daily – measurably – to some bank of talent or education, you are short changing yourself of a richer life. Here’s a simple way to change that:
- Pick something you’d like to do. It may be reading, cycling, weight training, meditation or learning a new skill.
- Pick a metric that you can measure. This might be pages read, weight lifted, distance run, minutes meditating =, or any other concrete number.
- Create a spreadsheet or journal where you can faithfully and consistently record your effort.
- Pick a starting point which is “too easy not to do.” Even if it’s one page, one pound, or one minute, make it absolutely achievable, regardless of your willpower.
- Schedule a time, preferably first thing in the morning, to pursue your chosen activity. Scheduling is important. Put it on your calendar, because things on your calendar tend to get done.
- Show up, do the work, record your effort.
- Repeat daily, gradually increasing the amount of work you put in to a sustainable, productive level.
Don’t place expectations on where this effort will lead, or if it is worth your time. Simply respect the practice and watch your efforts build over time. As your knowledge, strength, endurance, or attention grows, you’ll be surprised how important it becomes.
Then without realising you will have developed a new habit.
Some of Warren Buffett’s famous Quotes
The first rule is not to lose. The second rule is not to forget the first rule.
It’s better to hang out with people better than you, … Pick out associates whose behavior is better than yours and you’ll drift in that direction.
Value is what you get.
We enjoy the process far more than the proceeds.
Risk is a part of God’s game, alike for men and nations.
Of the billionaires I have known, money just brings out the basic traits in them. If they were jerks before they had money, they are simply jerks with a billion dollars.
If past history was all there was to the game, the richest people would be librarians
Chains of habit are too light to be felt until they are too heavy to be broken.It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.
In the business world, the rearview mirror is always clearer than the windshield.
There seems to be some perverse human characteristic that likes to make easy things difficult.
We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.
Why not invest your assets in the companies you really like? As Mae West said, Too much of a good thing can be wonderful.