Warren Buffett, a billionaire investor turned 93 today. If you want to learn investing and make money, listening to Warren is enough. While many of us want to be like him, it is just not possible to be so for many reasons. Some of them could be as follows:
1. Long life span with good health:
One in five thousand live beyond the age of 90. And most of those who live beyond 90, will be suffering from health issues, needing support and care. But Warren at 93, runs a business, actively manages billions of dollars. Though age has made his body weak, he seems to be healthy and his mind is sharp as ever. He still reads everyday, tracks economic data and makes investment decisions. Also shares his knowledge and wisdom.
We already know Warren made most his wealth after he turned 60. Well, most of us would be retired by 60 and dead by 70. So forget about compounding doing the same magic for us.
2. Not upgrading lifestyle:
Any common man would like to show-off with the increase in income. Even a level headed guy would want a comfortable living. But Warren still lives in the same house he had bought many decades ago in a sleepy village. He bought second hand cars and ate at McDonalds. He did not upgrade his lifestyle. He reinvested all of his savings, That helped him become what he has become. He is a living example for his quote "If you buy things you do not need, soon you will have to sell things you need". This is when most of the world lives on debt and borrows to spend.
3. Compounding Knowledge before compounding money:
After the graduation, he did not take up a job for money. He volunteered to work under Ben Graham to learn investing. He has spent most of his waking life reading. Not living in a town like New York saved him from commute time, flashy parties, celebrations and extravagant social circle. He did not need any kind of validation from the society. He just drove to his office to read multiple newspapers, company reports, and all the relevant things to keep him sane and make wise decisions. He compounded his knowledge before compounding his investments. This is when we can't wait to upgrade lifestyle, drive Ferrari and live in a massive mansion.
4. Staying within the circle of competence
Those who earn name and fame, be it movie actors, businessmen or scientists, often stay within their circle of competence. It helps them to keep focus and avoid errors. Warren did it too. He not only limited himself to the world of investing, he put money only in the businesses he understood well. While it is natural for most us to wander, and become error prone without proficiency in any one of the chosen subjects, Warren wisely avoided all those temptations. Even after becoming wealthy, he did not want to become a politician or try any other profession. Even when he decided to give away most of his wealth, rather than starting his own foundation, he gave most of it to foundations who are already doing a good job there. He chose to stick to running his own business which he was good at. Warren's investing style is simple but having his temper is difficult.
While I can give a dozen more reasons why we can't become another Warren, the above reasons are enough to indicate he is an unique person. While we are unique in different ways, becoming another Warren might not be a goal we all want to pursue either. He is a role model for many of us and not for all necessarily. Even if someone wants to follow his footsteps, you know it is quite rare to have a long life span having a sane mindset, not giving in to temptations and go on building the wisdom.
Warren who made billions and gave it away too, should be better known for his common sense, long term thinking and situational wisdom rather than the wealth he amassed. He has left behind a cult of investors and has motivated many across the world.
If possible, I would like to have the temperament of Warren, if not his wealth.
I wish him a happy birthday!
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