If I haven’t learnt anything new by lunchtime I feel I’m having a bad day.
I’m a voracious learner, yet it seems that most people go though life not really getting any smarter.
The average Australian seems to think education finishes when you leave school.
Of course you can acquire all the knowledge you want
But sometimes it’s easier to come home, sit on the couch, watch TV and zone out until bedtime rolls around.
But that’s not really going to help you get smarter.
According to Farnham Street there is a simple formula, which if followed is almost certain to make you smarter over time.
Simple, but not easy.
However, it involves a lot of hard work.
They call it the Buffett formula, named after Warren Buffett and his longtime business partner Charlie Munger.
These two are an extraordinary combination of minds.
They are also learning machines.
And we can learn a lot from them.
They didn’t get smart because they are both billionaires. It’s the other way around…
They became billionaires, in part, because they are smart.
More importantly, they keep getting smarter. And it turns out that they have a lot to say on the subject.
How to get smarter
Read. A lot.
Warren Buffett says,
“I just sit in my office and read all day.”
He estimates that he spends 80% of his working day reading and thinking. Charlie Munger commented:
“You could hardly find a partnership in which two people settle on reading more hours of the day than in ours,”
When asked how to get smarter, Buffett once held up stacks of paper and said:
“read 500 pages like this every day. That’s how knowledge builds up, like compound interest.”
All of us can build our knowledge but most of us won’t put in the effort.
But how you read matters too.
You need to be critical and always thinking.
You need to do the mental work required to hold an opinion.
Munger sees his knowledge accumulation as an acquired, rather than natural, genius.
And he’d give all the credit to the studying he does.
“Neither Warren nor I is smart enough to make the decisions with no time to think.
We make actual decisions very rapidly, but that’s because we’ve spent so much time preparing ourselves by quietly sitting and reading and thinking.”
How can you find time to read?
Finding the time to read is easier than you think.
One way to help make that happen is to carve an hour out of your day just for yourself.
It’s important to think about the opportunity cost of this hour….
On one hand you can check twitter, read some online news, and reply to a few emails while pretending to finish the memo that is supposed to be the focus of your attention.
On the other hand, you can dedicate the time to improving yourself.
In the short term, you’re better off with the dopamine laced rush of email and twitter while multitasking. In the long term, the investment in learning something new and improving yourself goes further.
Reading is only part of the equation
But reading isn’t enough. Charlie Munger offers:
We read a lot. I don’t know anyone who’s wise who doesn’t read a lot.
But that’s not enough: You have to have a temperament to grab ideas and do sensible things.
Most people don’t grab the right ideas or don’t know what to do with them
Nature or Nurture?
Another way to get smarter, outside of reading, is to surround yourself with people who are not afraid to challenge your ideas.
“Develop into a lifelong self-learner through voracious reading; cultivate curiosity and strive to become a little wiser every day.” — Charlie Munger
Read more at Farnham Street.
Subscribe & don’t miss a single episode of michael yardney’s podcast
Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.
Need help listening to michael yardney’s podcast from your phone or tablet?
We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.
Prefer to subscribe via email?
Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.