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Warren Buffett’s 10 Ways to Get Rich
By JLP | September 9, 2008
My sister-in-law, V, brought 10 Ways to Get Rich – Warren Buffett’s Secrets That Can Work For You to my attention, which was in this week’s Parade. These are some great pointers, but I would hardly call them “secrets.”
1. Reinvest your profits – this is the only way to take advantage of compound growth, which is money growing on money.
2. Be willing to be different – you follow the herd, you’re gonna get hurt. Going against the herd may be scary, but can pay off if done properly.
3. Never suck your thumb – If you find something good, act. Don’t sit around doing nothing.
4. Spell out the deal before you start – Get all the details in writing before you follow through.
5. Watch small expenses – The article mentions a guy who counted 500-sheet rolls of toilet paper to make sure he wasn’t being ripped off. That seems a bit extreme to me but I see the point of not wasting money.
6. Limit what you borrow – I believe that the only acceptable forms of debt are student loans, car loans (reasonable car loans), mortgages, and possible 0% deals that may pop up every once in a while. Now, don’t mistake that sentence to mean that I think it’s okay to have debt—that’s not what I’m saying. The main thing is to use debt as a tool and use it wisely.
7. Be persistent – Always remember the saying: “If at first you don’t succeed, try, try again.”
8. Know when to quit – You have to know when to say, “when.”
9. Assess the risks – Do some worst-case-scenario analysis before you proceed. In other words, count the costs before you begin.
10. Know what success really means – I love the fact that Buffett is not on an ego trip with his giving. According to the article, Buffett does not want any buildings named after him. That’s soooooo cool! I really respect that about him.
Anyway, there’s a quick summary of the article with my thoughts added. You can read the article here.
Topics: Books | 25 Comments »
September 9th, 2008 at 2:04 pm
Student loans got me into the sorry state I am in today.
September 9th, 2008 at 2:24 pm
Words from one of the most successful men in history can not be over-published.
Thanks
September 9th, 2008 at 4:39 pm
I would agree with Terry that you need to be very careful with student loans. Too many people mortgage their future by borrowing tons of money for college. I know that I did.
September 9th, 2008 at 6:55 pm
Enjoyed thsi post! I really like to read everything about this man. He has so much wisdom.
September 10th, 2008 at 12:43 am
Since December 5, 2007, Berkshire Hathaway has been lagging SPX. As of today, it is beaten by SPX with a 2 percentage margin. It’s investment in WFC, WB, AIG has been dwindling, dwindling and dwindling …
It’s funny that old man still gets heck luv misguided respect
September 10th, 2008 at 8:39 am
I would say most of those 10 ways can be considered common sense; though from time to time that’s a rare thing rather than the common one. I really like the understated tone of the list, the suggestions apply just as easily for a person living on minimum wage as one making billions.
September 11th, 2008 at 8:40 pm
I read that article too – I especially liked the story about how he got started making money. By selling packs of gum, then Coca-Cola, and so on. And good on his parents not to punish him when the cops stopped him for selling used golf balls.
September 14th, 2008 at 3:50 am
There’s a lot more on Buffett and his methods in his best biography to date by Roger Lowenstein. His auto-biography will come out in 2 weeks – it’s already one of the most popular books on amazon, and it’ll be priceless for everybody interested in PF or investing.
September 15th, 2008 at 3:05 am
great post
jasmine celion
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September 15th, 2008 at 3:56 am
Student loans are one of the most insidious financial threats out there. Business loans should, however, be on your “acceptable” list.
September 16th, 2008 at 6:10 pm
I have to agree with what Tom Hanna said. I believe that business loans are indeed acceptable. Taking reasonable amounts of risk and using leverage responsibly is key to making great returns. It will be hard to become rich only using the money you yourself have unless you are rich to begin with
September 18th, 2008 at 8:48 am
You missed out No.11. Write a book about it all.
September 19th, 2008 at 1:10 am
My advice is to take Warren Buffett’s advice. Since I started reading great business books and advice from successful entrepreneurs I’ve been able to quit my engineering job and run my own business full-time and I love it. Of course I’m also on the 10-year student loan repayment plan like many people…
September 19th, 2008 at 8:23 am
I have always strive hard to implement Warren Buffett’s advice. And his annual letter to shareholders is one of the most eagerly anticipated reading for me.
September 19th, 2008 at 8:23 am
I have always strive hard to implement Warren Buffett’s advice. And his annual letter to shareholders is one of the most eagerly anticipated reading for me.
September 30th, 2008 at 6:05 am
Striving for perfection can break you. Striving for excellence often produces above-average performance.
October 11th, 2008 at 4:10 am
warren buffet yaar kya karega atani sapati ko saath to kuchh bi ane vala nahi……
October 11th, 2008 at 4:28 pm
Everybody thinks that they are wise. Being rich means more bullshit to deal with.
October 11th, 2008 at 8:52 pm
warren buffet for president!
October 12th, 2008 at 4:13 am
do you really think those rich would really tell you how they get their money? All crimes they have committed just to fuel their wealth and greed.
October 12th, 2008 at 10:11 pm
At least NOT the blind leading the blind.
Regards;
Ong
October 13th, 2008 at 7:53 pm
Agreed, Terry, I’m 29 and if I am able to continue to make my student loan payments, they will be payed off when I’m 52 and I will have paid almost double the principal balance.
I am trying to add a bit extra to decrease that time, but it isn’t easy with my other bills.
October 16th, 2008 at 5:17 am
We spoke at the site myinvestorsplace.com that maybe Warren Buffett was getting in too early with his purchases of GE and GS… what do you think??? IS he still making money??
November 28th, 2008 at 11:42 pm
Of course, I know that we have to be persistent if we want to get rich. But knowing you are not happy with what you are doing, you can’t get rich. Interests and enthusiasm must be included in your list.
June 1st, 2009 at 4:35 pm
heres a top 10 stock picks list for you for 2009 http://davesstockpicks.blogspot.com/ I really liked this article