Warren Buffett’s Key to Success: Building Wealth Through Two Lists
Warren Buffett, also known as “the Oracle of Omaha,” has tens of billions of dollars to his name and is consistently ranked as one of the wealthiest people in the world. Buffett has amassed his fortune through successful investment strategies.
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According to ModelThinkers, Buffett’s “two lists” model has been another key to his success. It allows him to prioritize and say no to tempting or important tasks that get in the way of his main goal.
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Warren Buffett’s Path to Success
Warren Buffett began building his wealth by investing in the stock market at the age of 11, according to Forbes, and first filed his taxes at age 13. As a teenager, he was bringing in about $175 per month by delivering The Washington Post, Business Insider reported. This was more than most adults made at the time. He also sold calendars, used golf balls and stamps. At 16, he built the equivalent of $53,000.
As a young adult, Buffett formed his own company and began investing in companies he viewed as undervalued. He reinvested all profits in more investments and his wealth grew.
Most of Buffett’s wealth was built after his 50th birthday. According to Benzinga, Buffett transformed Berkshire Hathaway from a textile company into a conglomerate using his value investing philosophy. Today, the vast majority of Buffett’s net worth is tied to his publicly traded holding and investment company.
According to the Bloomberg Billionaires Index, the Berkshire Hathaway chairman and CEO is now the eighth-richest person in the world, with an estimated net worth of $136 billion.
Building Wealth Through Two Lists
One story published by James Clear best illustrates Buffett’s approach to productivity and time management.
Mike Flint — Buffett’s personal pilot for a decade and former pilot for four U.S. presidents — had a discussion with Buffett about career priorities. Buffett presented a three-step exercise to help streamline his focus.
The first step was to write down his top 25 career goals. In the second step, Buffett told Flint to identify his top five goals from the list. In the final step, Flint had two lists: the top five goals (List A) and the remaining 20 (List B). Flint assumed List A was his primary focus, but he was wrong.
Buffett reportedly replied, “No. You’ve got it wrong, Mike. Everything you didn’t circle just became your Avoid-At-All-Cost list. No matter what, these things get no attention from you until you’ve succeeded with your top 5.”
Buffett stated that List B should be completely avoided until the top five in List A were achieved. According to Buffett, this “two list” strategy is essential for true success: focusing on a few critical goals rather than spreading yourself too thin, Benzinga reported.
When you achieve one goal from your top five, add a new goal from List B. ModelThinkers noted that the list is always a work in progress, and something on the “avoid at all cost” list might become a priority as you achieve your top five from List A.
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This article originally appeared on GOBankingRates.com: Warren Buffett’s Key to Success: Building Wealth Through Two Lists