5 Reasons Why Warren Buffet Became the Greatest Investor of All Time

Have you ever wondered why Warren Buffet became the greatest investor of all time and the richest man on earth?

Was it because of his natural ability to trade stocks?

Was it a series of lucky breaks?

Was he just way smarter than everyone else?

I’d argue that the answer is none of the above.

I recently watched the documentary about Warren’s life called “Becoming Warren Buffet” on my flight to Chicago (it’s a great documentary and I highly recommend watching it), and it all made sense.

It was definitely not that he was lucky, super smart, or a “natural”. He really just worked harder and smarter than everyone else.

In this post, I’ll share 5 reasons that I believe made Warren Buffet the greatest investor of all time.

#1 – He dedicated his life to one thing

Most of us live our lives in a distracted world where we jump from one thing to another. We spend a few years working in one job, then we switch careers. We take on one hobby, get bored of it, and jump to another one. We learn about one subject, read a few books on it, and then explore other subjects.

Warren Buffet did the opposite of what we do. He dedicated his life to learning about and doing just one thing – making great investments. He didn’t “just” spend 10,000 hours (which usually takes roughly 10 years) to be come an expert. He likely spent more than 100,000 hours learning about and practicing the art of investing, to achieve a true level of mastery.

You can see a similar trend in other people who dedicate their life to one thing without worrying about being good at everything – they just practice more than everyone else. You can see the same pattern in people like Kobe Bryant who wouldn’t leave practice until he made 400 shots each day, Gary Kasparov who spent endless hours each day studying the patterns of old chess games to improve his own game, and world’s best copywriters that wrote hundreds of headlines a day to get better at writing great headlines.

Sticking with just one thing in your life is something that few people do, but the ones that do usually make it further than everyone else.

How to apply this lesson to your life:

If you want to become incredibly good at what you do, according to the studies pointed at on peoplebynetworth.com, the first thing you need to do is pick ONE thing you want to be great at, rather than 5 or 20 different things – and then dedicate your life to it.

To get started on your journey, you can decide to learn about just one thing for the next month. This might mean practicing your copywriting skills for a month, reading books only related to copywriting or connecting just with people who are incredible copywriters.

Then, if you want to get better at it, spend another month on it. And another. And another. It’s only a matter of time until you’ll get amazing at it.

#2 – He started learning about investing early on

While I don’t believe that Warren Buffet necessarily had “lucky breaks”, it’s true that he did have certain advantages over other people that allowed him to get to where he is today. One of those advantages was that his dad had a library full of books about investing.

When he was a young kid, he spent hours and hours reading those books and expanding his knowledge, when most other kids were just busy with playing around. This allowed him to clock in thousands of hours of learning and accumulate knowledge that made him look like a prodigy later on when most of his peers just started to learn about investing.

The same is true for most other “prodigies”. People like Tiger Woods and Mozart who are incredibly good at what they do usually started practicing when they were 3 or 4 years old, getting a head start on most people around them.

How to apply this lesson to your life:

Invent a time machine, go back in time, and start building expertise when you’re just 3 or 4 years old. Just kidding.

While you might not be able to go back in time, you can stop waiting for the “right moment” to get good at something. If there’s something you always wanted to learn about, get started with it today. Take that kickboxing class you are thinking about. Read that book about songwriting that’s on your wishlist. Bake that chocolate shuffle you always wanted to learn how to bake.

The other thing you can do if you have kids is to give them the ability to start learning something – either a sport, an art form or a skill – early on in their life, when they’re just a few years old. This will give them a fighting chance at becoming the best in the world at what they do.

#3 – He reads for 5-6 hours a day

Most of the days of Warren Buffet are pretty boring. He spends 5-6 hours a day secluded in his study, either reading about the stock market or thinking about investments he wants to make or the solutions to his problems. He has been doing that for years on end.

I noticed a similar trend in my mentor Allon who is a high-performance coach that managed world’s best tennis players like Novak Djokovic and Marat Safin. He spends hours and hours each day immersed in books, speeches, podcasts and online courses related to what he does. That’s why he seemingly knows everything there is to know about high performance – he’s been doing that for 20+ years.

Derek Halpern, a leading authority in the online business world is another example of this in action. In his early podcast interviews, he admitted that he reads 2-3 books a week because he heard that Warren Buffet did a similar thing. It’s no accident that he has amassed a wealth of knowledge that he shares in his YouTube videos and blog posts that get viewed thousands of times.

How to apply this lesson to your life:

Pick a subject that you want to learn about and buy and read EVERY book you can find about it. Even if you just read for 1 hour a day (for 30 minutes when you wake up, and 30 minutes before bed) you’ll be able to read a book or so a week. After you read 10 books about a certain subject, you’ll know the subject pretty damn well.

If you want to kick things up a notch, make the time to read more. Instead of spending time on Facebook , read. Instead of browsing the internet while you’re on the toilet or waiting at the doctor’s appointment, read. Instead of watching Netflix in the evening, read. As an added bonus, you can also listen to audiobooks on Audible while you’re committing or buying groceries, which can easily help you work through another book or two a week.

#4 – He stayed in his circle of competence

The school system nowadays encourages us to master every subject – from biology to psychology to art and maths. The society expects us to get good at cleaning, cooking and mowing the lawn. The online business world expects us to practice writing, speaking, podcasting, copywriting, Facebook ads, designing our websites…

Warren Buffet was different than most people in the fact that he was conscious of the things he was competent in and stuck with them. He never bothered learning about cooking or art – he stuck with investing. Even within the investing world he only made investments that he knew would work out, and wouldn’t take big, uncalculated risks. He stuck with the things he was good at.

Zlatan Ibrahimovic, one of the best football players in the world did a similar thing – he knew he was incredibly good at dribbling and attacking, so he practiced that. During the football matches, he would often stay up front and not help the defenders, so he could conserve his energy for when he needed it most – scoring goals. It’s no wonder that he still scores tens of goals each season at the age of 36.

How to apply this lesson to your life:

Don’t spend your time doing things that you’re not good at. Instead hire people that are just as good as you or better than you at designing your website, cleaning your apartment or making dinner. Then use the time you have available to progress further in developing your skill sets.

Instead of trying to get good at every skill of building an online business (writing, podcasting, speaking, etc.) start by spending your time on just ONE skill you’re good at. If you love writing, write. If you love speaking, speak on podcasts, create YouTube videos or speak at events. If you love writing stories, write a lot of stories. If you prefer writing about systems or tactics, write about that.

You don’t need to do everything that people tell you to do. Instead, you can be more like Warren Buffet and do what you’re competent in doing, and take full advantage of it.

#5 – He lives a very simple life

One of the reasons why Warren Buffet is able to get so much reading done is that he lives a very simple lifestyle. He doesn’t have a computer or a smartphone, so he doesn’t spend any of his time on needless distractions like Facebook, email or surfing the web. By living a simple life, he can dedicate most of his time to one thing that matters most in his life – reading about investing and investing.

Cal Newport writes about the importance of living a simple life in his book called Deep Work, where he shares countless examples of people who are able to create incredible amounts of work because they spend minimal time on distractions like email. He himself is a testament of that philosophy by not being on social media. Over the past few years he has published tens of academic papers, written multiple books and hundreds of blog posts, and read hundreds of books – all while having plenty of time for his family.

I’ve had a similar experience as I quit Facebook a month ago. It’s no coincidence that I’ve read 10 books over the past month, written tens of thousands of words and clocked in 40 hours of coaching calls, all while spending 10-15 hours a week in the gym and having plenty of time for my girlfriend, family and friends.

How to apply this lesson to your life:

If you want to become the best in the world at what you do, or even grow your business faster than you’re growing it right now, you’ll want to mercilessly cut out all the distractions that unnecessarily complicate your life. There’s no real other way around it. If you’re serious about doing this, I highly recommend Cal Newport’s Deep Work, it’s a great read.

So why did Warren Buffet REALLY become the greatest investor of all time?

In my mind, it’s simple. He just put in more effort, learning and deliberate practice than anyone else in this world. While most people are checking emails, he’s reading. While they’re browsing the news and spending time on Facebook, he’s working on new investments. He’s not smarter than them or luckier. He’s just more hardworking and more focused.

We can all learn from Warren Buffet and his habits. We can all dedicate our life to one thing, constantly read and improve our skill sets, stick with our strengths and minimize our distractions to live a simpler life. The only thing we don’t have an effect on is starting as early as Warren Buffet – but we can get started today.

Which was your favorite lesson from Warren Buffet and why?