3 Investing Tips From Warren Buffett

    • Melissa Chapman
  • Investing
investing chart

According to Forbes’ 2018 Word Billionaire list, business magnate and investor Warren Buffett clocked in at the third wealthiest person on the planet.

At 88 years old, Buffett’s history of investment success is a long one, and the CEO of Berkshire Hathaway has released a number of books detailing his tips for a successful career in business and investments.

His eighty-four billion dollar net worth has not come easily, and Buffett has dedicated a great deal of his life to guiding others towards success. Here, we list three of his best investing tips for the beginner – who better to learn from than the world’s top investor?

1. Make Your Biggest Investment In Yourself

Buffett has famously said:

“The best investment you can make is in your own abilities. Anything you can do to develop your own abilities or business is likely to be more productive.”

This simple yet brilliant piece of advice overarches Buffett’s entire philosophy on the world of investment: without a solid personal foundation on which to grow your career, you will likely fall short.

Studying both the investment market as well as yourself can jumpstart your career and allow you to play to your own strengths and believe in your own abilities. Invest your time in learning about yourself and where your strengths and weaknesses lie.

While putting your trust in yourself can be a daunting prospect, it is with this self-sufficiency that you will ultimately be able to better yourself and your future endeavours.

There will, of course, be bumps in the road, but Buffett suggests recording your own mistakes so that you don’t make them again. In his words “the rearview mirror is always clearer than the windshield”. Move on from your mistakes while still allowing what you have learned from them to shape your future.

2. Be Patient

Warren Buffett advocates for patience in everything – time is the friend of the successful investor.

Instead of rushing to sell stocks or other investments when they are at their most valuable, remember that this is only their most valuable so far and that just because you could make money selling something, it doesn’t mean that you should.

Buffett’s mentality is to hold onto stocks for years in order to reap the best rewards – only if you need the money should you allow yourself to part with your investment early.

Of course, patience is not a guarantee for success, but Buffett’s main argument is that one need not rush towards a goal: instead, give yourself the time you need and don’t lose faith in your decisions too quickly. “Successful investing takes time, discipline and patience. No matter how great the talent or effort, some things just take time”. Being patient with both yourself and your investments is one of the key ways to achieve the kind of success Buffett believes in.

3. Don’t Get Caught Up In The Actions Of Others

While Buffett does stress the importance of building relationships and allowing yourself to receive help and guidance from those you admire, he also believes that a certain degree of success can be found in an independent approach to investment.

Often, news reports can be misleading and can result in frenzied selling of stocks and other investments that only serve to create hype and overreaction. Not allowing yourself to get caught up in this hype is part and parcel of being patient and trusting your own investments and decisions.

Buffett has said that you should “try to be fearful when others are greedy and greedy only when others are fearful” – avoid following the scrambling crowd and instead choose to play the long game.

Allowing yourself to grow and accumulate your own knowledge and business plan can be helpful in separating you from others. Create your own unique approach that is tailored specifically to you and the you that you have invested in.

Buffett also advises that you only invest with your own money – this way, you can begin to gauge how you are faring independently, and you can prevent yourself from landing up in sticky situations.

There is a reason that Warren Buffett’s success is celebrated and recognised the world over: his independent, business-savvy, and patience-driven approach is one that has proven helpful not only in his life but in the lives of those he inspires.

Buffett is a master when it comes to the business world, and it is his focus on self-growth and trust that has made him what he is today. Keeping in mind these three tips that Buffett swears by, you will be able to take one step further towards your own investment career goals as well as those regarding your personal growth.

Mammoth Investor
New South Wales 2000