10 ways to get rich, courtesy of Warren Buffett

By
Real Estate Agent with HomeSmart Realty West CalBRE #01458572

Since I worked at various Borders bookstores for over 35 years, I'm kind of addicted to reading. I read newspapers, magazines, books, and more.

A few weeks ago a book was released about Warren Buffett, the world's richest man, with an estimated fortune of $62 billion. Hmmmmmm. He could have rescued a few banks all by himself. The book is The Snowball: Warren Buffett and the Business of Life, by Alice Schroeder.

One of the promotional pieces in advance of the release date was 10 Ways to Get Rich: Warren Buffett's Secrets That Can Work For You, a synopsis of which I provide for you here:

  1. Re-invest your profits—Most of us spend our profits: new car, vacation, etc. Re-investing it can lead to greater wealth down the road.
  2. Be willing to be different—I think I read where Buffett said about the stock market, "Buy when everyone else is selling."
  3. Never suck your thumb—Gather the information you need to make a decision, and then make a decision. More sitting and more thinking is just "thumb sucking."
  4. Spell out the deal before you start—Many of us can take this one to heart because of all the work we did for a "Client" who wasn't under contract only to have him or her use someone else.
  5. Watch small expenses—I'm constantly amazed at the super rich who will haggle over a dollar here and a dollar there. Perhaps that's how they got to be rich.
  6. Limit what you borrow—As many have discovered recently, living on loans and credit cards doesn't make you rich. Keeping up with the Joneses doesn't make you rich. Having lots of toys that aren't paid for doesn't make you rich.
  7. Be persistent—My Partner loved this one since his favorite catch phrase seems is "Be persistent and consistent in what you do." That persistency and consistency can result in winning battles against more established competition.
  8. Know when to quit—You will have some losses in life. Know when to walk away.
  9. Assess the risks—I like to do this by creating two TOP 10 lists for any major decisions I might make, one for all the negative things that might happen, and one for all the positive things that might happen. It usually happens that one of them won't have 10 things on it, making my decision quite easy.
  10. Know what success really means—This is really powerful, so I'll quote directly from Buffett: "I know people who have a lot of money, and they get testimonial dinners and hospital wings named after them. But the truth is that nobody in the world loves them. When you get to my age, you'll measure your success in life by how many of the people you want to have love you actually do love you. That's the ultimate test of how you've lived your life."

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  1. Edna Ledoux Jamieson 10/23/2008 12:48 PM
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Rainer
97,844
Lara O'Keefe
North Texas Home Finders - McKinney, TX

Jim. thanks for sharing! That is some very good and powerful advice.

lmo

Oct 11, 2008 03:57 PM #1
Ambassador
1,340,791
Norma Toering
Charlemagne International Properties - Rancho Palos Verdes, CA
Palos Verdes & Beach Cities Homes in L.A. CA

Warren knows a thing or two about making (and saving) money.  His new book is on my must read list.

Oct 11, 2008 04:21 PM #2
Rainmaker
1,198,781
Tony & Darcy Cannon
Keller Williams Legacy - Woods Cross, UT
The C Team

Jim, thanks for sharing that list, nice short and concise!

Oct 11, 2008 05:11 PM #3
Rainer
226,839
Ryan Shaughnessy
PREA Signature Realty - www.preasignaturerealty.com - Saint Louis, MO
Broker/Attorney - Your Lafayette Square Real Estate Partner

Love the Buffettisms - definitely knows value and how to assess risk.

Oct 21, 2008 06:26 PM #4
Rainmaker
95,407
Michael Sahlman
www.HomesForVIPs.com - Keller Williams Realty - Miami Beach, FL
e-PRO - Miami Beach Florida Luxury Homes

Jim I have to bookmark this and read them again, or do something really crazy and actually read the whole book he wrote!

Oct 21, 2008 10:34 PM #5
Rainer
28,399
Edna Ledoux Jamieson
Lakeshore Rentals & Sales - Smith Mountain Lake, VA

Thanks for sharing this.  I agree that we can all be wasteful on "little" expenses and the folks that have $ are more conservative. 

Oct 23, 2008 12:41 PM #6
Rainer
125,232
Laurie Logan
Keller Williams Realty, Inc., Broker Associate - Madison, WI
South Central WI Real Estate

Hey Jim,

Thank you for sharing this list, I especially like the idea of writing the 'two top ten lists,' good way to analyze things!

Take care,    Laurie

Oct 29, 2008 02:20 PM #7
Ambassador
562,631
Julie Chapman
Lennar - Jacksonville, FL
New Homes Sales

Warren Buffet would have made a great President to bring this country's economic issues into order.....

Nov 09, 2008 09:07 AM #8
Rainer
141,208
Tanya V Fresh Eye Designs LLC
Fresh Eye Designs LLC - Lawrenceville, GA
Where Staged Equals Sold

Jim, thanks for sharing. Warren Buffet is great! Even with all his success and money, he is still a very pratical guy.

Nov 09, 2008 09:53 AM #9
Rainmaker
526,226
Shirley Parks
Sands Realty 210-414-0966 - San Antonio, TX
Broker, 210-414-0966, San Antonio TX Homes

Hi Jim, I have trouble with number 8, "know when to quit." :-(

Dec 05, 2008 05:20 PM #10
Rainmaker
243,033
Bill Dean
Worth Clark Realty St. Louis, Mo. - Fenton, MO
William Dean - Broker, Salesperson

Jim,

A little too late for me on number 6 Limit what you borrow??  Had to use the plastic more this year than ever befroe.  But a good post and a lot of wisdom in copying what Buffett does.  thanks

Dec 06, 2008 11:37 PM #11
Rainmaker
333,348
Gerry Khatchikian
Red Lodge, MT
ASA, TRC, SFR

Jim,

I enjoyed reading this post.   Thank you for the synopsis.   We can all learn from the wisdom, great experience and time tested investment advice of Mr. Buffet.  I would be interested to know how you got colored fonts in your post.   I am new to AR and this the first post where I am seeing the use of colored fonts.

Dec 30, 2008 02:16 PM #12
Rainmaker
198,163
Kent Anderson
Coldwell Banker Realty-Schweitzer Mountain, Sandpoint, Idaho - Sandpoint, ID
from Schweitzer to the Lake
Great points, Jim. ...especially #4..."spell out the deal before you start". Add to that..."smarter, not harder". Happy New Year.
Dec 31, 2008 06:23 PM #13
Rainmaker
130,018
KAREN SANCHEZ
Real Living Hamilton Landon - Apple Valley, CA
...Marketing your home like no one else will.

Thanks Jim,

I had a tough week.  This was the a need little shot in the arm.   I'll go back and do it again tomorrow.  I'll be working on #7.  I don't think it's time for #8.

Karen

Feb 08, 2009 09:37 PM #14
Rainmaker
49,232
Richard Overall
United Country Premier Properties - Harker Heights, TX
Your OVERALL Long-Term Real Estate Resource

Hi, Jim, just stumbled across your list.  Thanks for the boost.  These are great reminders that we in real estate don't have a job, we have a business and we should treat the day to day decisions as such.

Feb 24, 2009 09:09 PM #15
Rainmaker
145,149
Kathleen Frawley
Keller Williams Sacramento CA 916 730-4404 - Elk Grove, CA
South County Sacramento, 916 730 4404

Great stuff Jim! I'm addicted to reading also...read the book, and your synopsis was exceptional thanks.

Apr 24, 2009 01:54 AM #16
Rainmaker
1,108,597
Jim Frimmer
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist

Hey, Kathleen.

I could never be rich like Buffet, Gates, Winfrey, and others, but it is fascinating to read how they did it, much more interesting than reading the daily trash about Lohan, Hilton, Spears, etc.

Apr 24, 2009 12:04 PM #17
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Jim Frimmer

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