How To Become Rich Like Warren Buffett
Everyone wants to become a millionaire. If you want to learn how to become rich like Warren Buffett, then think different. His way of thinking is a contrarian mindset. With this foundation alone, you’re far ahead in the intelligent investing game. Warren Buffett’s wealth was built upon the sound foundation of the value investing philosophy. This style of selecting and managing stocks was pioneered by his mentor Benjamin Graham.
You could achieve Buffett’s wealth, but certainly not his current influence. You start by adopting the mindset of the man. Many folks have tried to cocktail the selections of Berkshire Hathaway (his holding company) but have failed. Thinking like the Sage of Omaha is your best chance to clone his results – rather than copying his existing portfolio formation.
1. Learn How to Invest Like Warren Buffett
What is the mindset of the chairman of Berkshire Hathaway? And how do you clone it? Warren Buffett has been shaped by a ton of past experiences. Besides the mentorship he received from Ben Graham, he’s had a childhood full of side hustle ventures. He also had stock ownership through his dad who had a stock brokerage firm at the time.
These short investing discourses below are not the entire expanse of Buffett’s style. But they’ll simply give you a glimpse of a few stars in the vast universe of Buffettology. For further study, read this book that changed my investing mindset. The Warren Buffett Way, written by Robert G. Hagstrom. Then you can check out the book that Buffett himself called the best book of investing ever written: The Intelligent Investor, by Benjamin Graham. That’s your first step in learning how to become rich like Warren Buffett.
Vital Points about Buffett’s Investing Mindset
- The Mental Model: Thinking models by which decisions are made rationally.
- The Temperament: Introvert by design with no desire to follow or please the herd.
- Investment Style: Philosophy of Value Investing that screens a shortlist for undervalued opportunities.
- Stock Picking Tenets: From Cigar Butts to Cigar Boxes (cigar analogy and puffs)
- Portfolio Management: Focused portfolio full of businesses within your circle of competence.
- Taming Stupidity: Avoiding avoidable mistakes and sticking to things you have control over.
Learning the investing ropes are the next steps in shadowing the Oracle of Omaha. Warren Buffett was a child prodigy. He had all sorts of business aspirations. On the other hand, his investing education actually started after meeting his mentor Benjamin Graham, author of The Intelligent Investor and Security Analysis.
Sage Tip: 6 Habits that Can Make You Rich for Life
Therefore, you’ll discover how to become rich like Warren Buffett through value investing. This is the investing philosophy where stocks are treated as businesses. They are analyzed and bought at a discount to their intrinsic value. This requires the use of fundamental analysis to estimate the underlying value. The investor also regards the qualitative tenets that a business’ managers are supposed to have.
2. Read a Lot of Investing Books
Warren grew up on a diet of books. He’s not just a book worm, he’s more of a book anaconda. Warren Buffett spends a better part of his day reading at work. He reads business books as well as financial reports. He maintains that reading is one of his secrets to building a durable circle of competence. You simply cannot skip books if you want to know how to become rich like Warren Buffett with investing.
Vital Points about Buffett’s Reading Habit
- Build Your Reading Foundation: Core foundational Books and other additional titles to build upon.
- Create a reading list: Revisit your top 10 books annually and read them again.
- Read Business Biographies: See how other mindsets match up to Buffett’s
- Read Annual Reports: Delve deep into the unseen stories that produce the nice bottom lines
- Read Berkshire’s Annual Letters: Hear the voice of the man himself
3. Follow Warren Buffett
The affable Warren Edward Buffett is a very old man. At age 93 (at the time of writing), he’s not on social media. He’s not exactly the social type either. He often refers to himself as the odd ball. So how can you figure out how to become rich like Warren Buffett? Simply be on guard to hear him speak at various events, interviews, and business news appearances. Take notes, document and bookmark them for reference.
Vital Points about becoming a follower of Warren Buffett
- Follow Warren Buffett’s Fan Pages: On social media, and any local event that lends itself.
- Follow Warren Buffett’s Advice: Every word from his chops is a verbal gold standard.
- Follow Warren Buffett in the News: Search the web for the latest appearances.
- Follow Buffett’s people: Follow also Charlie Munger, and the Berkshire Hathaway subsidiaries.
- Follow Warren Buffett’s Net Worth: Forbes lists and ranks the man on an annual basis.
- Follow Berkshire Hathaway’s Stock: The gold mine you’d love to buy and hold forever.
4. Start Your Own Business
Give business a shot. If you have your own business, or side hustle, run it the Buffett way. And if you’ve always been dreaming of starting your own business, then make it happen! As you start and run your business, your interests should align with your customers’. Then align your mindset to the Buffettology idea and go big and list your business on the stock exchange.
Vital Points about Building a Business Buffett would love to buy someday
- Apply Warren Buffett’s Management Style: Run it like a Berkshire acquire.
- Excel at Delighting the Customer: Put both your customers and shareholders at the top.
- Build a Baby Berkshire Hathaway: Use your own business to buy other businesses.
- Have Lunch With Warren Buffett: This privilege is for a selected few – who pay up to $20M.
- Sell Your Business to Warren Buffett: The proof that you have a great business is to be acquired by Berkshire Hathaway.
Sage Tips:
Your business model can evolve to become a traditional Holdco ( holding company). This means, you’ll be deploying capital to buy other businesses as a holding company. After Buffett himself mastered the art of stock picking he graduated into buying whole businesses. This big business ownership arena is where you learn how to become rich like Warren Buffett.
5. List Your Business on the Stock Market
Go from being a fan to becoming an investment. The best honor is to build a brand that the world would like to invest in. When your small business goes public, you will raise capital for growth. Public companies are accountable to their shareholders primarily. You will also appeal to large and small institutional and private investors. Their demand for your stock will increase your listed stock’s value. That is how to become rich like Warren Buffett in the world of business.
Vital Points about Going Public with your Business
- Turn Your Hobby into a Real Business: Just Do it! Take action and get started.
- Run Your System Passionately: Your business should operate with a predictable and intentional system that delights customers without fail.
- Build The Unstoppable Dream Team: The real value is your people; you build and nurture a winning team.
- Grow Your Margins Exponentially: The health of you business is transmuted into great profit margins over time.
- Become Very Attractive: Investment Bankers must fall in love with the current state of your profits as well as your business model.
- Execute an IPO: List on the stock market and garner capital from new investors.
A Few Parting Words on How to Become Rich like Warren Buffett
Becoming wealthy like Buffett may sound like a zillion yards out of the ball park. But no billionaire actually does this over-night. With a determined mind, you can think and invest like the Oracle of Omaha. You can adopt his contrarian mindset and cultivate the subtle virtues that made him different from other investors.
If you get the simple steps in place, then use patience and humility to compound on your growth. Ultimately, it’s the power of compound interest that rewards intentional intelligent investing. The modesty of the man also counts. He never paid himself a hefty compensation as CEO and Chairman of a multi-billion dollar holding company. That’s how to become rich like Warren Buffett. You must, cut costs in everything you buy – demanding and expecting great value for each dollar you put forth.
What do you admire about Warren Buffett the most? Why do you think that one thing has a big part in him becoming a billionaire? Please share your views and insights in the comments below.
Frequently Asked Questions (FAQs) about how to get rich like Buffett
How much does Warren Buffett make a day?
Buffett’s annual income is $100,000. But his net worth is from his investment holdings. He’s known to have made an average of ~$37 million per day in first quarter of 2023.
How many hours does Warren Buffett sleep?
Eight hours of sleep. That’s all he needs – according to a PBS interview.
At what age did Warren Buffett become a millionaire?
He made his first million dollars in his early 30s.
What is Warren Buffett’s number 1 rule?
It is “Never lose money!”
What is the key to success for Warren Buffett?
Warren Buffett is one of the most successful businessmen and investors of all time, and one of the keys to his success is his ability to prioritize and use his time wisely.
What did Warren Buffett study?
He graduated in 1949 with a Bachelor’s Degree in Business Administration from the University of Nebraska. Then a Master’s Degree in Economics from Columbia University in 1951.
At what age did Warren Buffett start investing?
At age 11
What does Warren Buffett read every day?
He reads about six newspapers a day. Namely, The Wall Street Journal, The New York Times, Financial Times, Omaha World-Herald, American Banker, and USA Today. On top of that, he broods over many pages of annual reports, and also business books.
How many hours does Warren Buffett read?
For five to six hours a day.
What kind of car does Warren Buffett drive?
A 2014 Cadillac XTS
What does Warren Buffett do for fun?
Warren Buffett plays the ukulele, and also the card game bridge.
Where does Warren Buffett live now?
Omaha, Nebraska, in the United States of America.
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