You’ve likely seen Warren Buffett, one of the wealthiest people alive, on TV discussing finances and other topics. How did Warren Buffett amass such wealth? Well, one of the tools that allowed Mr. Buffett to earn his fortune is a simple tool that he calls the Formula for Success – and it is actually far more straightforward than you think. Let’s discuss the process that Warren Buffett uses to be successful.
The Buffett Formula
Buffett is known for reading quite a lot – in fact, spending some 80% of his day devouring books. While the sheer amount of reading – 500 or more pages per day, isn’t achievable every day for all people, it does serve as the cornerstone for a simple philosophy of learning something new every day and keeping your mind very active.
The Buffett Formula is pretty simple to acquire new knowledge and use it constantly, even in little bites – and do it very often. Buffett says that knowledge builds up like compound interest when you read a lot every day.
Reading a bit every day helps people like Buffett be able to consume more knowledge and recall something that might help in a situation. Part of the key here is to spend less of your time using more passive entertainment forms like television and social media, and more of it gaining thoughts and ideas that will help you in the real world.
One very simple strategy for continuous learning is to develop a routine and rhythm that involves having an hour or two to yourself so that you can dive into something interesting. Whether this means getting up early before the kids are up to do some reading, or taking your whole lunch break at work to sit in a quiet place and focus, you’ll find that setting time aside for the purpose of learning is very valuable to avoid distractions.
Reading information that could challenge your thoughts and ideas builds up over time. Just like monetary interest, knowledge builds up over time and becomes bigger and more powerful. Learning something new about business or leadership will make you want to learn more, and the process will just keep going.
One of the biggest obstacles to consistently following the Buffett formula is distractions. Scrolling through your social media feed or responding to emails might feel good now, but isn’t really an investment in your future. Simple setting time aside for those things and setting the expectations that you won’t respond immediately helps too.
While the Buffett Formula sounds relatively simple, some will find it difficult to remain consistent. The key to Buffett’s Formula is not to completely eliminate distractions and things that don’t lead to compounding knowledge but to reduce them and set separate times for those things.