Alveena Ahmad
Warren Buffett’s strategic investments have no doubt reached mythical proportions. It is because he follows the five-hour rule and spends 80 percent of his time in reading and analyzing. Buffett has spent most of his life reading and thinking since he was in grade school. Most people think that Buffet can read because he has a lot of time to do that but in reality, having free time is never available to anyone unless a proper strategy is applied.
There are some strategies Warren Buffett has used throughout his career so that he can have more time to read and think. Following are the six strategies that you can also follow to do what’s most important to you every day:
1. Kill busy work:
Buffett has not been seen talking to Wall Street because he estimates that around 20 percent of the typical public CEO is spent there. Therefore, he never talks to analysts and rarely talks to the media. For his entire career, Buffett has lived outside of NYC in Omaha, and like any typical CEO; Buffett barely attends any internal meetings.
2. Work with people you could see yourself working with forever:
Buffett has the habit of working with people he trusts, who gets results, and someone with who he can work for decades. He audits who he works with because of this he does incredibly little negotiation and due diligence before purchasing a company. He enjoys conversations with his CEO and this is the reason he has ignored purchasing many companies with attractive financials who had CEOs he did not trust.
3. Keeping things simple:
Buffett lives a very simple life and has been living in a modest home for the last 60 years. On his personal needs, he spends only $100,000 per year and no matter how much he gains, he does not add complexity to his life with more spending. For Buffett, what is truly powerful is to keep things simple and it takes effort and skill which he uses very intelligently.
4. Focus on a few:
Buffett does not make numerous investments; he is in a habit of making just a few investments every year. It is because he believes that exceptional returns are a result of concentrated portfolios. According to Buffett the trick in investing is just to sit there, watch pitch after pitch goes by, and wait for the one right in your sweet spot. You need to ignore what people around keep on yelling.
5. Focus on long-term bets:
It is Warren Buffett’s habit to hold bets for extremely long periods of time. His current top five options have been held for over twenty years on average. For the typical mutual fund, this compares with an average holding period of less than one year. But he is not the only one who thinks long-term, the largest accelerator in the world Sam Altman refers to long-term thinking as one of the few arbitrage opportunities that are left in the market. Also, Jeff Bezos measures the success of the new programs over a seven-year time frame whereas, most other public companies think in a three-month increment. Warren also pointed out to investors not to invest in Bitcoin saying it’s a lost bet in the future.
6. Avoid the technology bandwagon:
In order to stay up-to-date, Buffett avoids riding on the technology bandwagon. He is very clear on what information he requires for making an investment. He is not willing to do what is trendy and is confident in his own thinking. He is keen on removing potential distractions around him rather than depending on willpower.
On a theoretical level, Buffett’s strategies are extremely helpful but they lack a few things on the practical level. Following is an elaborated process that can help you prioritize your schedule with the help of the 8020 rule:
7. Know what your true values are:
When you don’t know what the true values are, you stay unsatisfied all the time. Therefore, learn what your true values are and then move forward with your strategies.
8. Identify the top 20 percent priorities that will give 80 percent of the outcome:
Here you need to get a perspective on what actually matters in your life and rise above any kind of information overwhelm to stay focused.
9. Practice the 80/20 rule:
Just like any other skill, you must practice the 80/20 rule in your daily life. It is because prioritization is a skill and by learning as well as using various mental models, you can see different perspectives of seeing your priorities.
Conclusion:
Warren Buffett’s strategies for maximizing productivity and focusing on what truly matters in life offer valuable lessons for anyone seeking to prioritize their time effectively. By adopting principles such as minimizing busy work, surrounding oneself with trustworthy individuals, simplifying one’s lifestyle, concentrating on a few key investments, maintaining a long-term perspective, and avoiding trendy distractions, individuals can streamline their efforts towards what truly aligns with their values and goals.
Additionally, incorporating practical steps such as identifying one’s true values, pinpointing the top priorities that yield the most significant outcomes, and consistently applying the 80/20 rule to daily tasks can further enhance one’s ability to prioritize effectively. Prioritization, like any skill, requires practice and the utilization of various mental models to gain diverse perspectives on what truly matters.
Ultimately, by integrating both Buffett’s strategic insights and practical prioritization techniques, individuals can optimize their time, focus their efforts on what brings the most meaningful results, and cultivate a more fulfilling and purpose-driven life.
