10 Best Advice Mantras From Warren Buffet

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The “Oracle of Omaha” has created an impressive following of people and his investing results have proven the test of time.  Below are some simple bits of wisdom that I believe are timeless.

  • Never lose money.  Buffets rule # 1 is to not lose money.  And his rule #2 is to remember rule #1.  Keep in mind if you lose 50% of your investment, then it takes 100% return to get back to even…yikes that’s hard.
  • Get high value for low price.  What his means is value is what you pay for.  Make sure that you are paying the right price for the value in the produce, business or investment that you are buying.
  • Build health money habits.  Habits are what drive our behavior.  It’s been said that finance is 80% behavior and 20% math.  If we don’t change poor behaviors with our wallet then we can expect for us to find success with money or building a business.
  • Avoid debt and more specifically credit card debt.  Be wary of credit card debt because interest rates can be as high as 18% and more.  If you must roll over your credit card balance regularly then you can’t afford spending on it.  In effect you are trading your future for your present satisfaction.
  • Keep cash on hand.  Come up with what your minimum cash balance needs to be.  Is it 3 months or 6 months of expenses?  “cash is to a business as oxygen is to an individual: never thought about it when it is present, the only thing in mind when it is absent,” said Buffet.
  • Invest in yourself.  Your biggest income producing asset is yourself.  Improve your skills to make yourself more valuable to the market.  Unlike other assets and investments, “nobody can tax it away and they can’t steal it away,” said Buffet.
  • Learn about how to manage money as a part of the investment in yourself.  Not everyone enjoys this subject, however, there are simple methods to follow that help you win with money.  Spend less than you make…. save 15% into a low-cost index mutual fund…it’s not how much you make its how much you decide to spend.
  • Trust a low-cost index fund. Expenses matter when it comes to returns on your investments.  Consistently adding to your investments each month or quarter exercises an important “money muscle.”
  • Give back on a regular basis.  There is a saying about giving of our “time, talents, and treasure” to our community and nonprofits.  I believe giving is a natural law of human nature where we want to help others in need.  Giving produces psychic benefits for the giver and it helps society move forward.
  • Long term game.  Investing not only dollars but in ourselves is a long-term game.  Building true financial security takes time.  Buffet said, “someone’s sitting in the shade today because someone planted a tree a long time ago.”

Together these pieces of advice can help take us on the journey to financial security.  The advice is simple and timeless.  Here is to your chance to implement the advice and reach your financial goals!

Mike

6 Tips for Increasing Productivity

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Is increasing your productivity one of your New Year’s resolutions?

I recently read an article by Stephanie Vozza that outlined a number of productivity tips she culled from various CEOs and entrepreneurs.  Given how connected we are in today’s 24/7 world, one of their universal frustrations was getting focused work done.  Here are 6 ideas for you from Vozza’s article:

  1. Keep one day a week meeting free.  Meetings are a necessary way to communicate among your team and the verbal communication can be critical for understanding. However, meetings are also a disruption to getting work done.  One person’s meeting is another person’s disruption.  CEO Dustin Moskovitz at Asana has implemented a “no meeting Wednesdays” rule so actual work free of disruptions happens.
  2. Take a nap.  Many of the top CEOs and business owners take a nap during the workday to recharge.  Studies have revealed higher levels of productivity occur when you take a 10-20 minute nap daily.  The timing of the nap depends on your optimal work cycle.  Some people take a nap after lunch as they digest their food, and others take one following their afternoon coffee.  The caffeine from the coffee doesn’t kick in until about 20-30 minutes later, just enough time to nap and then get a jump start on your next cycle of work.
  3. Allow downtime to think.  Downtime is critical for a business owner to think about their business strategically.  “Doing” all the time does not allow for space for planning.  Sara Blakely, CEO of Spanx, lives near her office, however, she does a “fake commute” where she drives aimlessly around so she can have her thoughts come to her in the quiet car ride commute to work.  She can then write down an idea and be ready for the day.  Bill Gates, founder of Microsoft, would take “think weeks” and retreat to a secluded location to read and think about the business.
  4. Be email specific and send fewer emails.  CEO Jeff Weiner of LinkedIn sends as few emails as possible.  He noticed that most of his email clutter was the result of response threads in emails where too many people were copied who felt they needed to respond.  After he decided to write and respond to only the absolutely necessary emails, he noticed a dramatic decrease in the volume coming to his inbox.  Another tip is to give a specific deadline in your email to help shorten the back and forth.
  5. Decide quickly.  Have you ever experienced the “paralysis by analysis” over an issue when people get frozen in their decision making? Meg Whitman, former CEO of Hewlett Packard, said “a fast no is better than a long-extended no or long-extended yes.  It helps knowing that when you make mistakes, you can always fix mistakes.”
  6. Make a list.  I start each week with a list of activities that I want to accomplish for myself and my clients.  It helps me prioritize what needs to get done and when.  Brian Chesk, CEO of Airbnb, says he “makes a list of everything you want to accomplish that day.  Be as exhaustive as possible…. grouping similar tasks together.”  This helps me ensure as much as possible that things don’t fall through the cracks.  While the system is not perfect, it is a way to help stay on track.

Productivity and time management have always been a key component of an effective leader.  Today with all of the distractions that surround us, it’s even more important to stay vigilant on maintaining our productivity to help us win each day. 

Cheers to increasing your productivity!

Mike

Should You Ever Stop Learning?

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As kids are heading back to school (at least here in Georgia), it brings to mind the question of “Are you ever too old to stop learning?”  The answer, of course, is no.  The notion that the CEO of a business should “know all” is a relic of the past.  Given the rapid pace of change in today’s digital world, the CEO needs to be a person who embraces the ideal of lifelong learning and realizes that they “don’t know what they don’t know.” 

Some of the best leaders consider themselves constantly learning and they never want to stop learning.  This should not just resonate at the top level of leadership but also throughout an organization.  Creating this type of environment is one of the qualities that sets “great” companies apart from “good” companies, according to Jim Collins’ classic Good to Great.

How do you set up an environment to model lifelong learning?  One method I have seen successfully implemented is the CEO who models the behavior of self-improvement.  I have met leaders who are at the pinnacle of their careers, and they have engaged with seeking out mentors and coaches to improve themselves.  In 2015, Harvard Business Review did a study of 45 CEOs with formal mentoring relationships and found that through these relationships their company performed better financially.  They also made better decisions and an demonstrated an improved ability to meet the needs of its stakeholders.

The mentor or coach is not necessarily senior to you and can run across generational divides for the person to gain insights from a wide range of perspectives.  I have been a part of a business roundtable, Vistage, for over 15 years and engage monthly with other local peers who are both senior and junior to me.  I learn from all of them because they help me understand issues from many different perspectives.  I have also recently engaged a personal business coach to help me better understand my blind spots and where I need to focus to improve my skills.

These relationships helps facilitate the exchange of ideas and information that I may not otherwise get exposed to.  I know of companies who hold regular offsite learning meetings with the sole purpose of providing their teams with information that helps them improve their leadership.

There is also no substitute for accountability.  Meeting on a regular basis with a coach, mentor, or mastermind group that holds you accountable can make the difference between success or failure both professionally and personally.

Cheers to a lifetime of learning!
Mike