What I discovered When I Tried Warren Buffett’s 5/25 Rule

dav

I saw a video recently about Warren Buffett’s 5/25 rule in which it is claimed that Buffett once had a conversation with his pilot. For anyone who doesn’t know, Warren Buffett is one of the most successful investors in the world and has been top of his game for decades. After realising he’d had the same pilot for 10 years, he was perturbed to find that the pilot had not moved on in all that time. I will be paraphrasing, but Buffett says something along the lines of “if you’ve been working as my pilot for 10 years, I must not be doing my job right” so he instructs the pilot to write down 25 career goals and that he can write anything he wants.

Next Buffett tells the pilot to prioritise the top 5. This is more difficult, but the pilot does it. Now, Buffet asks him

“What will you do with the other 20?”

The pilot says “I will treat these as 2nd best and work on them when I have spare time”

Buffett replies “No. You avoid those at all costs, until you had achieved your top 5.”

Buffett explains that spreading yourself too thin means you don’t make any significant progress towards any of your goals. Focusing on a goals instead, is the key to making progress.

This doesn’t mean that you are limited to do just 5 things for the rest of your life, never trying anything new, just repeating the same cycle of days for the rest of time. BUT you can’t do number 6 until you have achieved ONE of the top 5. This is the crux of the idea.

This idea can be applied to any area of life where you have too many options. Too many options meaning there are multiple things you want to achieve, but you never quite seem to get any of them done, they just remain on a wish list for all time. For example, do you have too many hobby projects you never complete? Too many career skills, so none seem to improve all that much? Too many new business ideas, but you don’t ever seem to start any? All of these can be whittled down to your top 5, allowing you to focus and make real progress.

I tried this for myself. I don’t have 25 career aspirations, so I wrote down 25 things I want to do in my life in general from hobbies, to work, to travel. The top 5 I prioritised, see below:

  1. Improve my writing
  2. Improve my blog
  3. Exercise regularly
  4. Travel outside Europe
  5. Start a Side-Hustle
  1. I have been reading more and more lately about the benefits of being able to write well, which was part of my inspiration to start a blog, so that was always going to end up on this list.
  2. This blog is new, there’s lots of room to grow and improve, but I’m enjoying the process so far With a lot of practice I hope to be writing better articles, have a better website and anything else that would make the blog better.
  3. I have been trying to do this for years, but I always give up a few weeks in. I was recently pointed towards “Couch to 5k”, which aims to make running a habit by easing you in. Instead of going too hard too soon and quitting, as I always have done in the past, you build up to longer runs until you can do 5k even if you started from a point of doing no exercise at all. The best part for me has been the structure the app provides, as I tend to just run hard, then get tired and never want to run again.
  4. I love to go on solo-travel trips, but I have played it pretty safe so far, going to European cities where pretty much everyone speaks English and the culture isn’t too different to our own. I want to go further away and experience more, even if it is a little scary to not speak the language or know all the customs, that’s part of the fun, right?
  5. I recently read a fantastic book by Chris Guillebau, in which he describes the merits of having a “side-hustle” and how to start one. The book is very clearly written and inspiring, with great advice. I aim to write a post on it someday soon. The main reason the idea drew me in, is it allows you to have a project of your own, that gives you a sense of achieving something of your own. Guillebeau says it’s not about workaholism, having a second job would be a nightmare for many people. Side-hustles come come in many different forms, as you can see on his podcast it’s a creative outlet for some people for others it gives them a sense of independence. It’s a great way to do some work you enjoy, just for you, without going all in and quitting your job to start a business.

If this post or the original video inspires you to try the idea for yourself, please let me know in the comments below, how it worked out for you!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s