Today, 30-Aug-2021, Warren Buffett turns 91. I have never met him. Although, in 2009, I owned stocks of Berkshire Hathaway and I could’ve gone to Omaha for the annual shareholders meeting, except that I thought it was expensive to make the trip!

In 2015, I took a 3 month sabbatical from work. One of the things I did during the break was to read all the 50 letters of Warren Buffett to shareholders. And reading those letters changed my life. I fell in love with Warren Buffett and investing. And I decided to spend the rest of my life investing. So, if there was no Warren Buffett or his letters, my life would have been a lot poorer.

Some of Warren Buffett’s best lessons aren’t even related to investing. It’s about how to live and how to think of the world around us. Here are some of them, in no particular order.

#1: Living by an inner scorecard.

“Would you rather be the world’s best lover but everyone thinks you are the worst or would you rather be the worst lover but everyone thinks you are the best?”

-Warren Buffett

The first way of living is the inner scorecard and the second, the outer scorecard. And, in my opinion, living by an inner scorecard is the better way to live because you don’t really care about the world’s opinion anymore. If you know in your mind and in your heart why you are doing what you are doing, then that is all that matters. As I started to think and live by this philosophy, seeking likes on social media seemed like living by an outer scorecard. And therefore I deleted my Facebook and Twitter accounts.

Investing is a lot like inner scorecard. You have to take decisions that maybe unpopular with everyone else. The outcome matters less and the process more.

#2: I can buy anything I want but I can’t buy more time.

We have just 24 hours in a day and about 80 years’ worth of days of life. That’s it. And that time is diminishing. (Visit a few funerals and you will know what I mean. )

And after thinking about this for a long time, I came to the conclusion that to have more time, I must subtract. Things that are most important to me like work, family, health, friends and relations will get my time and attention. Things like what to eat, what to wear, what to drive are no longer that important will get very little time and attention. By eliminating such decisions and such activities, I am saving time and energy. By eliminating social media from my life, I have eliminated activities pertaining to seeking validation.

In the book “Almanack of Naval Ravikant”, I came across this wonderful idea of the aspirational hourly rate. Even when Naval Ravikant was poor he had set an aspirational hourly rate of $5000. So spending 30 minutes (=$2,500) to save $50 on a flight ticket was an absolute no-no. While I admire the business of D-mart, I don’t intend to spend 2 hours to save some money. I can buy a more expensive car, but I choose not to because my current one is extremely low maintenance and therefore costs me less time.

And this brings me to why it is important to say no.

The difference between the very successful and the successful is that the very successful say no to almost everything.

-Warren Buffett

Very recently I received a very innocent request: would I be willing to pay the utility bills of a distant distant relative and a senior citizen, every month going forward using online means?

One way to think was the incremental effort to pay his bills would be minuscule. Another way to think was that I am not just paying bills, I am taking on some additional responsibilities which must be discharged in good times and difficult times. For example: if I forget to pay his power bill for any reason and his connection is disabled, would I do the needful to ensure his power is restored? I was not comfortable thinking of such a scenario and what it would cost me in units of time. And therefore with a heavy heart I chose to say No. (To the the list of things I eliminated, I can add popularity too 🙂 )

#3: Associate with people better than you.

It has been an article of faith for me that I should always try to hang out with people who are better than I. There is no question that by doing so you move yourself up. It worked for me in marriage and it’s worked for me with Don Keough. When I’m with Don Keough, I can feel myself on the up escalator.

– Warren Buffett, Foreword to The Ten Commandments for Business Failure by Don Keough

Great minds discuss ideas; average minds discuss events; small minds discuss people.

-Eleanor Roosevelt

By associating with people better than us we have a chance to inculcate their thoughts and behaviors. Eleanor Roosevelt may have been talking of my friends when she did about great minds, because they are all very humble people, they talk of great ideas from books. They all value time over money and they never indulge in any gossip.

Cherish some man of high character, and keep him ever before your eyes, living as if he were watching you and ordering all your actions as if he beheld them.

-Seneca

Mohnish Pabrai has a bust of Charlie Munger in office and Charlie Munger has a bust of, not Mohnish Pabrai, but of Benjamin Franklin. On my bedroom wall, I have portraits of Warren Buffett and Charlie Munger. And on my work desk I have a caricature of them to guide me.

#4: The ovarian jackpot

Warren Buffett has said this many times that being born as White, Male in America in the 1930s was an ovarian jackpot. Absent any of those conditions and his talents would have been useless. For example, his sisters (Female, also White) got the message in many ways from their mother that they needed to look after their homes and families. Likewise, there were very few countries that had such a mature capital market at that time.

Indians like me have benefited immensely from the economic reforms since the 90s. If I were not educated or if my country wasn’t free or if I didn’t have the reforms program, I couldn’t have progressed in life as much as I did. I live in a time when there is internet, electricity, running water, vaccines which has allowed me to find and pursue what I love. So while it may be tempting to think it was all because of me, the fact is a majority of it is because of luck. I too hit the ovarian jackpot like Warren and I am enjoying the fruits of the trees which were sown by several people who came before me.

And therefore it becomes a responsibility to sow seeds so that others that are not as lucky or are yet to come can have opportunities to progress in life. Thank you Warren for giving away most of all your wealth and prioritizing humanity over wealth.

#5: Not sleep walking through life.

Finding a passion and a purpose in life and following it, even if it means earning less.

#6: Having low expectations in life.

Low expectations are like shock absorbers. If things don’t turn out as expected, you are unlikely to be dejected. But if things do turn out better, you have everything to be happy for. Warren Buffett could have given sermons about how you too can become rich and successful as he, by staying focused and working hard and so on. Instead he seems to say: I had low expectations and I got lucky.

#7: Develop a great sense of humor like Warren Buffett.

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I read this somewhere, but am unable to verify this: Warren Buffett was asked how would he like to be remembered a 100 years from now. He said “as a teacher”.

Thank you, Warren Buffett for all your teachings.