I've read the Barefoot Investor and got my money buckets working in a way that's helping me to manage my money better, build a mojo account and pay out toxic debt. Now it's time to develop my financial education and learn more about the world of investing.
But I know nothing.
I am a complete beginner.
The world of investing has been a mystery to me for a very long time. Where do I even start?
I'm a big believer in reading and learning from others, so it was only natural to find a book that would help me to develop my understanding of investing.
Also, self-education appeals to me - a lot.
In the past I'd never paid much attention to investing because, let's be honest, I found the whole thing confusing and learning the language and culture of investing seemed too hard.
But now I am curious and driven to gain an education in the world of investing.
And who better to start my education with than Warren Buffett!
When I decided to delve deeper into the world of investing, I picked up The Tao of Warren Buffett and hoped it would provide me with insight into the philosophies and values that drive Warren Buffett - successful investor, philanthropist and one of the richest men in the world (according to my highly scientific Google search) to invest with wisdom.
I'm happy to say that The Tao of Warren Buffett has not disappointed me. It has been a book filled with guidance, insight and wisdom. It's a great purchase and addition to my home library.
The book is written in a simple way that makes it easy for people like myself to read and understand. It's a small book, only 174 pages long and that's including the index.
The authors have created a book that is easy to read one page a day if that's how you would like to approach it.
The book is broken into the following topics:
Getting and Staying Rich
Analysts, Advisors, Brokers - Follies to Avoid
Why Not to Diversify
Discipline, Prudence, and Patience
Beware the Folly of Greed
When to Sell, When to Leave
Mistakes to Beware Of
Your Circle of Competence
The Price You Pay
Long-Term Economic Value Is the Secret to Exploiting Short-Term Stock Market Folly
Under each topic, the authors quote Warren Buffett and then go into a page long explanation of what he means. They provide the reader with nourishing ideas to think through in relation to actions the reader may want to take in building their own investment portfolio. But no advice (as outlined in the disclaimer) is officially given.
As I have read each page, I have started building a basic understanding of the investment world and Warren Buffett's personal approach to it. It has been a great experience and I am developing a hunger to learn more.
So far I have learned quite a few things from reading this book, including:
the idea of never losing money and never breaking that rule - I'm not sure how easy this rule is to keep from breaking but I'm interested.
be thorough and investigate a company's management and economics to be as sure as possible that it aligns with your values and is a good purchase before buying.
the importance of having a moat of safety - I'm still trying to wrap my head around that idea but I do understand the basic concept that it's about the protection of an asset.
invest in the sweet spot by seeking investments that are selling at a reasonable price but also have value and longevity - this relates to a baseball analogy that Warren Buffett uses in his investing strategy.
invest in the long term and compound, compound, compound.
There's so much in this book for investors and for anyone just wanting to gain a basic understanding of the underlying concepts, beliefs and values that have guided Warren Buffett to become such a successful investor. More than I can highlight here and really, I don't want to spoil the reading experience for you.
The Tao of Warren Buffett is a wonderful way to start my education in the world and mindset of investing and I have found it to be a book to read and contemplate. It's a way of practising the art of investing and going beyond emotions to analysis and practising habits that may bring about great financial success over time.
If you are interested in growing your wealth mindset through learning from a long time investor such as Warren Buffett, you may want to consider dropping into your local bookstore and picking up a copy. Then pour yourself a cuppa, put your feet up and enjoy Warren's way of working in the world, his philosophies and his values.