Twelve Insights from Warren Buffett on How to Get and Stay Rich
- personal995
- Dec 12, 2024
- 4 min read
Updated: May 7, 2025
Warren Buffett, often referred to as the "Oracle of Omaha," is one of the most successful investors of all time and a long-time CEO of Berkshire Hathaway. Born in 1930, Buffett displayed a keen interest in business and investing from an early age. Over decades, he transformed a modest initial investment into a multibillion-dollar fortune, cementing his reputation as a master of value investing. Despite his immense wealth, Buffett is renowned for his down-to-earth lifestyle and commitment to sharing practical financial wisdom.
Buffett’s insights on building and maintaining wealth transcend stock markets—they apply universally to anyone seeking financial independence and a fulfilling life. His philosophy emphasizes patience, discipline, and long-term thinking. Core principles such as living below your means, investing in yourself, avoiding unnecessary debt, and harnessing the power of compounding form the foundation of his approach. Buffett’s focus on rational decision-making, quality over quantity, and surrounding oneself with the right people offers a blueprint for sustainable success.
1. Frugality: Live Below Your Means
“If you buy things you don't need, you will soon sell things you need.” Warren Buffett
Buffett has always emphasized financial discipline over outward displays of wealth. Despite being a billionaire, he still lives in the modest home he bought in 1958. He believes that freedom is found in avoiding lifestyle inflation.
Lesson: The first step to wealth is spending less than you earn—and staying that way, no matter your income level.
Useful Members Link: Frugality (State)
2. Self-Investment: Make Yourself Your Greatest Asset
“The best investment you can make is in yourself.” Warren Buffett
Buffett attributes much of his success to personal development—especially communication skills and lifelong learning. He reads for hours each day and advises others to build both knowledge and good habits.
Lesson: Before you invest in stocks, invest in your education, character, and ability to think clearly.
Useful Members Link: Self-Investment (State)
3. Long-Term Thinking: Value Over Velocity
“Someone's sitting in the shade today because someone planted a tree a long time ago.” Warren Buffett
Buffett believes in playing the long game, whether it’s in investing, reputation, or relationships. He avoids trends and short-term fads, focusing instead on long-lasting value.
Lesson: Focus your time, energy, and capital on things that will compound over decades, not weeks.
Useful Members Link: Long-Term Thinking (State)
4. Patience: Resist the Urge to Act Fast
“The stock market is designed to transfer money from the impatient to the patient.” Warren Buffett
Impulsive decisions destroy wealth. Buffett urges calm, considered choices, and a mindset that welcomes boredom in pursuit of long-term gains.
Lesson: Let others chase excitement. Your job is to stay calm, stay the course, and wait for the right opportunity.
Useful Members Link: Patience (State)
5. Compounding: Let Time Work for You
“My wealth has come from a combination of living in America, some lucky genes, and compound interest.” Warren Buffett
The magic of compounding rewards consistency more than brilliance. Start early, be consistent, and let time amplify your efforts.
Lesson: You don’t need to be a genius to get rich—you need time, discipline, and consistency.
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6. Debt Avoidance: Don’t Let Debt Steal Your Future
“I've seen more people fail because of liquor and leverage - leverage being borrowed money. Warren Buffett
Buffett has repeatedly warned that debt, especially used irresponsibly, is one of the fastest ways to destroy wealth. He avoids leverage personally and professionally, urging others to build their lives and businesses on solid, debt-free foundations whenever possible.
Lesson: High-interest or excessive debt undermines your ability to grow wealth and stay resilient - avoid it unless absolutely necessary.
Useful Members Link: Debt Avoidance (State)
7. Competence: Stay in Your Circle
“Risk comes from not knowing what you're doing.” Warren Buffett
Buffett only invests in companies and ideas he deeply understands. He advises others to do the same - stick to your circle of competence and expand it slowly over time.
Lesson: Focus your time and energy where you have an edge and avoid pretending to know what you don’t.
Useful Members Link: Competence (State)
8. Saving First: Spend What’s Left, Not the Other Way Around
“Do not save what is left after spending; instead spend what is left after saving.” Warren Buffett
This mindset reversal is key to building wealth. Saving is a non-negotiable and use automation to make it effortless.
Lesson: Pay yourself first. Make saving a habit, not an afterthought.
Useful Members Link: Saving First (State)
9. Temperament: Be Rational, Not Reactive
“The most important quality for an investor is temperament, not intellect.” Warren Buffett
Intelligence alone doesn’t build wealth, emotional discipline does. Buffett avoids emotional decisions and remains steady during booms and busts.
Lesson: To succeed financially, master your emotions more than the market.
Useful Members Link: Temperament (State)
10. Quality: Fewer, Better Choices
“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” Warren Buffett
Buffett applies this principle to everything, from business to relationships. He looks for quality and is willing to wait or pay more for it.
Lesson: Aim for quality in what you buy, where you work, and who you spend time with. It always pays off in the long run.
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11. Environment: Choose People Who Elevate You
“It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.” Warren Buffett
Who you spend time with shapes your thinking, standards, and outcomes. Buffett credits much of his character and success to surrounding himself with the right people.
Lesson: Seek out people who inspire you to be better and avoid those who drag you down.
Useful Members Link: Environment (State)
12. Safety Margin: Plan for What You Can’t Predict
“The three most important words in investing are: margin of safety.” Warren Buffett
Buffett always plans for downside risks. Whether buying a business or managing cash, he insists on buffers that protect against surprises.
Lesson: Build your life and finances to withstand volatility—don’t assume everything will go right.
Useful Members Link: Safety Margin (State)
Buffett’s approach to wealth isn’t built on complexity, it’s built on character. By mastering timeless fundamentals and staying calm while others chase trends, anyone can apply his principles to grow wealth, freedom, and peace of mind.
Member's Related Links & Readings:
Berkshire Hathaway Letters to Shareholders by Warren Buffett (Library: Finance & Investing)
The Snowball (Warren Buffett Biography) by Alice Schroeder (Library: Biography)
Financial Management (Finance)
Investing (Finance)
Knowledge (Competence)
Detachment (Wisdom)
Judgement (Wisdom)
