Warren Buffett's Top 10 Rules of Success

He is one of the most successful investors, philanthropists, and business tycoons and a billionaire worth over $70 billion. Since 2017, Warren Buffett has been considered the second richest man in the world and is famous for his investment advice and strategies.

Many people model his success and want to learn his strategies to build massive wealth. In this article, you will discover Warren Buffett's top 10 rules for success.

Buffett was born in Omaha and developed an intense passion and interest in business and investing in his youth. He graduated from Columbia University and learned his investment philosophy from another great investor, Benjamin Graham, who is famous for his principle of value investing.

Buffett's company, Berkshire Hathaway, owns more than 60 companies, including Geico, Dairy Queen, and Duracell. While most young people have a good time playing games, Buffett started his career as an investor. He bought his first stock at age 11 and filed a tax return at age 13.

Along with his best friend Bill Gates, the richest man in the world, Buffett launched The Giving Pledge, asking billionaires to donate their wealth. Facebook founder Mark Zuckerberg was one of them. Buffett believed in giving back and pledged to donate over 99% of his fortune to charity. To date, he has given nearly $32 billion to charity.

So, how was Warren Buffett able to produce such a fantastic outcome in his life, amassing massive wealth and creating outstanding success in his investing career? He has a particular set of principles and philosophies regarding making a decision, investing, running a business, and succeeding in life. These principles of success can be summed up with the top 10 rules below.

1. Find your passion

Almost all successful people agree that finding and following your passion is important if you want to produce amazing results in life. Warren Buffett is also convinced of this. During an interview, he confided that he had been lucky enough to discover what he liked to do from an early age. He said that once people find their passion, their lives will change.

There's no guarantee you'll be able to find your passion in your first job, but you have to keep digging until you find it.

Passion is the only way to produce exceptional work. Without passion, you will do things with a half-hearted approach, and there is no way to become the best that way. So, find your passion, do what you love, and you can produce incredible success in life when you do.

2. Recruit well

If you want to be a billionaire, you can't do it alone. You have to have a good team, and to have a good team, you have to learn how to recruit well. Always remember that you cannot succeed in this world alone. You need the help of others to bring you the success you want. Your employees will be your greatest assets.

Buffett emphasizes three qualities when hiring: integrity, intelligence, and energy. Buffett also said that integrity comes first out of these three qualities. He jokingly said that you don't want to hire someone who has no integrity but a lot of intelligence and energy. Integrity comes first. Without integrity, other qualities don't matter.

Buffett is famous for saying, "It takes 20 years to build a reputation and five minutes to ruin it." He firmly believed that to build a billion-dollar company, you must hire someone with integrity. This is because people have to manage money in business. And if you hire people with no honesty, many problems will arise.

3. Don't care what other people think

Buffett's third rule of success is that he doesn't care what other people think. This is extremely important because if he wants to consider what others have to say, his decision will be influenced, and he will never be able to cling to his investment principles. If Buffett were to listen to what others were saying, he would become like most people, living an average life rather than living like a billionaire, and become such a successful investor.

The same goes for you. When it comes to achieving the success you want and living your dreams, some people will tell you that it is impossible to achieve what you want and simply suggest you get a real job... Never listen to the opponent.

Warren Buffett is known for the concept of the "circle of competence," which he used to focus his investments on operating only in the areas he knew best. The concept basically explains that each of us has developed useful knowledge in certain areas, and we need to operate in those areas that we are good at. So ignore what others have to say about the rest.

It is human nature to want to be assimilated and accepted by others. However, this will cause you to worry too much about what others think and say about you. It will also prevent you from living your best life on your own terms. When you care too much about what others think and say about you, you will restrict your freedom and always be their prisoner.

4. Read, read, read

It said this billionaire reads about 5-6 hours a day and about 6 newspapers every morning. The more you read, the wiser you will become and the more knowledge you will get.

Your skill will help you make better decisions that will lead you to success.

Before investing in businesses, Buffett often read Benjamin Graham's "The Intelligent Investor.". Successful people are great readers, and you must adopt the same habits.

Reporters asked SpaceX CEO Elon Musk how he learned to build rockets. Elon's response was simple: "I read books." Reading helps one learn more about the world and become more open-minded.

So, commit to reading every day. If you are busy and need more reading time, start small and read 15 minutes daily. Go for more. Read for at least an hour a day. You can wake up earlier and make time to read or make good use of your commute time to read.

5. Have a safety margin

The concept of a "margin of safety" originated in Benjamin Graham's teachings. Warren Buffett, Graham's most successful follower, learned the concept and used it in his investment portfolio.

The concept is easy to understand, and Buffett often explains it using the metaphor of driving over a bridge. When you build a bridge, you insist that it can carry 30,000 pounds, but you only drive 10,000-pound trucks on it. Thus, you have a safety margin of 20,000 pounds.

When it comes to investing, you'll never buy a $50 million company for $60 million. You will buy the company worth $50 million at a lower price than this to ensure a margin of safety. In banking, a bank will never lend you money if you can barely pay the interest each month. The banks will ensure that you have an extra to pay the loan installment in case something goes wrong.

This concept is central to the principle of value investing. It helps investors make better and wiser decisions before they buy a stock. When an opportunity comes your way, evaluate it using the concept of a margin of safety before deciding.

6. Have a competitive edge

Buffett said capitalism is someone coming in and trying to take the castle. In the business world, your company must have a sustainable competitive advantage to survive in the long term.

Today's competition is tough, and people can copy exactly what you do, produce the same product, and put you out of business. That's why having a competitive edge is essential to protect your business, just as a moat protects a castle. Buffett said he would invest in companies with a competitive edge because he wants to ensure the company will still be around years from now.

So ask yourself: What are you good at? How can you make your product so unique and special that other people can't copy it? What kind of service can you provide to your customers that can act as your competitive advantage, make your business flourish, and help you become the industry leader?

7. Plan your personality

One of the rules that ensured Buffett's success was that he built his businesses around his personality. Buffett said he doesn't like meetings and builds his businesses how he wants and loves. He also mentioned that to succeed in what you do, you have to find your rhythm and sweet spot to enjoy your work and perform at your best.

Buffett loves to read and chooses to read to improve his knowledge. Then, he acts as a strategist and runs his business from behind the scenes. You should do the same if you want to perform at your peak level.

Well, not everyone can be like Warren Buffett and spend five hours reading every day, but you can plan your work around your personality. If you like to have a cup of coffee before you start work, do it. Organizing your workspace according to your own taste will make you more productive. The key is to play to your strengths and personality so you can become the best at what you do.

8. Always be competitive

Buffett thinks one of the most common killers in business is complacency. When people fall into their comfort zone and fail to improve their competitiveness, their companies will eventually fail or be taken over by competitors.

And to stay one step ahead, you always have to compete. Every business has problems in every industry. Buffett believes the key to success is its ability to compete and stand out from the crowd. When IBM stock fell significantly, Buffett said IBM didn't perform as he or management expected. He also said that IBM is a significant and robust company with a big and powerful competitor. And IBM must improve and innovate to continue to thrive in its business.

Buffett also said Geico had added 700,000 policyholders over the past year, far outpacing receding competitors. That's why he invested in Geico, and the business continues to thrive because it is still in the competition. Therefore, never rest on your laurels. Stay competitive, and keep improving and innovating in your business.

9. Success Model

There is only one way to succeed in this world. If you want to succeed in life, you need others. You need to model other successful people, or better yet, find yourself a mentor. This is why Warren Buffett learned from Benjamin Graham and worked for him as a disciple.

Look at the sports industry; every outstanding and professional athlete has a coach. Tiger Woods has a trainer. Michael Jordan has a trainer. Usain Bolt has a coach. You need a coach to guide you on your journey to success. Your coach can also remind you of your goals and encourage you to do your best.

A mentor in business is considered one of the most important keys to success. When Steve Jobs started, he learned and received a lot of business advice from Mike Markkula. The same goes for the famous motivational speaker Les Brown. When Les was young, LeRoy Washington guided and mentored him to achieve the best in his life. Les Brown was called "educable mentally retarded" at school, and one day his mentor, LeRoy Washington, said something to him that changed his life. He said to young Les Brown:

"Don't let someone's opinion never become your reality."

So, find a mentor or coach to guide you in your business and life. Success leaves clues, and to produce a great result, you need to model the success of others. Learn and study from others, then improve to become better.

10. Give unconditional love

Finally, Warren Buffett believes unconditional love is the most potent force. And the unconditional love he received from his father, Howard Buffett, a US congressman, made Warren who he is today.

Buffett says his father believes in and supports him in everything he has done. Whatever Buffett has done, no matter how much money he has made, his father will tell him to do his best in whatever he tries. That is why Buffett believed he could produce excellent results in his life. He also suggests that anyone wanting to succeed should give unconditional love.

While this last Warren Buffett rule of success has nothing to do with a trading strategy, it has much to do with your personality and beliefs. As a philanthropist, Buffett believes in helping society and giving back to the world. He always seeks to help and to give rather than to take. Operating with a giving and helping mindset puts your customers first, making a business thrive.