Investing is a marathon, not a sprint. Finding a financial routine that works for you can be just as effective as making one big “lucky” decision.
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Just ask billionaire investor Warren Buffett, who has a surprisingly simple yet focused daily routine. A recent Finty.com article tracks what he does between being awake to his slumber and how his daily routine informs his success.
Buffett’s Morning Routine
Buffett rises each morning and drinks a can of Coca-Cola before heading to his local McDonald’s for breakfast. In the 2017 HBO documentary “Becoming Warren Buffett,” he reported that when he feels prosperous he buys a bacon, egg and cheese biscuit, which was just $3.17 at that time.
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“The market’s down this morning,” Buffett told the crew filming his routine. “I’ll pass up the $3.17 and go with the $2.95.”
Some might question the necessity of saving 22 cents when his net worth is $146.2 billion, but Buffett plays the long game. He understands that seemingly small financial decisions can have massive consequences.
For example, imagine it’s 1965. Warren Buffett has bought Berkshire Hathaway, and a share costs $19 that year. You save 25 cents a day for 76 days, then take your $19 and invest.
Fast-forward to the holiday season of 2023. You’ve held onto your single Berkshire Hathaway share, which has now increased in value by nearly 4,400,000%. Your 25 cents a day are worth $833,121.
Every savings opportunity counts.
The Workday Is Spent Doing Hours of Research
Buffett spends his workday reading in his office. He spends the most time researching investments using company financial documents, investor reports, and industry publications.
When researching an investment, Buffett delves deeply into the company’s story. He reads about as much of the history as possible, tracking its progress and financials, and examines its growth strategy.
Understanding your investment target is a cornerstone of Buffett’s financial strategy.
“What an investor needs is the ability to correctly evaluate selected businesses,” he wrote in a 1996 letter to shareholders.
Note that word “selected.” You don’t have to be an expert on every company, or even many. You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.
When you understand what a company does, your research is more effective and efficient. You can interpret company financials and understand why the organization performed as it did. More importantly, you can critically assess strategy and decide whether it looks promising.
You don’t need doctoral-level expertise, but understanding the basics is essential.
Winding Down for the Night
Buffett has always prioritized work-life balance. He gets home from the office between 5 and 6 every evening, which is usually after another trip through the McDonald’s drive-thru.
This is noteworthy because, according to Finty, Buffett becomes frustrated when others don’t respect his boundaries.
Leaving work on time may not be the sole secret behind Buffett’s success, but balance almost certainly helps him make better decisions. Taking personal time reduces stress, which can impair a person’s ability to make rational decisions. By closing the books at 4 or 5 p.m., Buffett lets his brain reset and prepare to make good decisions the next day.
After enjoying his evening away from work, Buffett puts himself to bed at 10 p.m., reads for half an hour, and turns out the light by 10:45 p.m. His simple lifestyle may seem at odds with his status as a legendary investor, but it works.
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This article originally appeared on GOBankingRates.com: Warren Buffett: A Look Inside the Billionaire Mogul’s Daily Routine
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
