As of 2022, 92-year-old Warren Buffet has a 102 billion dollars net worth, being the world’s fifth biggest billionaire, right before Bill Gates. According to Forbes, Warren Buffet, also known as the “Oracle of Omaha”, is one of the biggest and most successful investors of all time.
Even though he’s respected and admired for his business savvy, Buffet is also known for coming up with brilliant wisdom. This article will tell you everything you need to know about Warren Buffet’s 5/25 rule and how it can help you improve and increase your productivity.
Free eBook: How to work smart, not hard
Get a free copy of the eBook and learn top productivity tips for teams and their leaders
What is Warren Buffett’s 5/25 Rule?
Warren Buffet’s 5/25 rule is a productivity strategy based on three simple steps:
- Write down a list of your top 25 career goals.
- Circle the 5 most important goals that trulyspeak to you. These areyour most urgent goals and the highest priorities to focus on.
- Cross off the other 20 goals you have listed that hold less importance.
Since those 20 goals aren’t as urgent as the 5 you circled, according to Warren Buffett, any effort invested in them doesn’t allow you to truly focus and dedicate time and energy to the 5 highest-priority goals. And that’s exactly what the Warren Buffet’s 5/25 rule is all about.
Why is Warren Buffet’s rule important?
The truth is one of the main contributors to workload and workplace stress is the limited amount of time and energy available to reach our daily goals. And why is that?
Maybe we’re a little too ambitious and chase too many goals simultaneously. So, we end up not spending the necessary amount of time and energy on the bigger goals we set for ourselves.
As a result, we get easily tired, distracted, and lose focus, ending up not fulfilling our dreams and accomplishing what really matters to us.
And that’s the key point in Buffet’s rule, to answer one simple question: How do you find a way to prioritize and focus when there are so many goals calling for your attention?
According to Warren Buffet, his simple 3 step strategyhelps you focus on your most important goals first and achieve consistent progress in your life.
How is Warren Buffet’s 5/25 rule helpful?
The 5/25 rule is an exercise used to help people truly focus on the most valued accomplishments that are most meaningful to them.
Even though it’s most used for career accomplishments, the 5/25 rule can be applied to both personal or professional goals, family time, or career aspirations, making it an effective, simple technique for prioritizing all aspects of life.
However, making lists of goals is something that most people already do. It’s the typical first step in countless goal-setting methods.
The truth is, it’s Buffett’sway of prioritization that makes this rule so unique: selective focus. Buffet’s 5/25 rule is precisely how you prioritize your list of goals the Warren Buffet way.
Focus solely on fully committing to smaller goals to complete them more effectively instead of juggling all your goals at once.
At first, this kind of sounds weird, right? But the truth is we’re constantly used to assuming that doing more is better, in terms of speed and quality, even though we deep down know that’s not true.
It’s humanly impossible to give all your time and energy to many things at once. It will only make you fail at everything and accomplish nothing.
Free eBook: How to work smart, not hard
Get a free copy of the eBook and learn top productivity tips for teams and their leaders
Do you know what are the differences between long-term goals and short-term goals? Read everything in our blog.
How did the Warren Buffett’s 5/25 rule come about?
The origin of this story may not be 100% accurate. However, it’s said that Warren Buffett’s 5/25 rule came out of advice he gave to his airline pilot Mike Flint.
Supposedly, Flint asked Buffett for life advice and how to find time to get everything in his life done. Buffett replied with a three-step approach to solving the problem.
The story is that he first asked Flint to write down his 25 professional priorities and then circle the 5 most important items, leaving Flint with two separate lists: the 20 less important goals, his B-list, and the top 5 goals, his A-list.
However, as weird as it sounds, this exercise’s point was not to pay much attention to the A-list. The true purpose was for Flint to create his B-list, to identify his 20 less important goals. Because these are the real problem.
These things will pull focus and time away from the A-list, the top 5, and the truly important goals for Flint. These are your biggest energy suckers and professional distractions.
The 5/25 rule is a reminder that it’s not what you do but what you don’t do that drives your productivity and performance.
But how is this even effective? Does it work?
Free eBook: How to work smart, not hard
Get a free copy of the eBook and learn top productivity tips for teams and their leaders
Is Buffet’s 5/25 rule effective?
Yes. It’s that simple. This Buffet’s 5/25 does work simply because you’re acknowledging that you can’t focus on lots of things at once, which we humans tend to do all the time.
We always tend to think we can have more on our plate than we truly can. Put it this way: just as you can’t have 25 jobs, you can’t work towards 25 goals at the same time. You just have no time or energy for it. It’s impossible!
This constant state of ruthless prioritization is characteristic of Buffett’s business philosophy. One of his most famous quotes is
“The difference between successful people and really successful people is that really successful people say no to almost everything.” After all, what is prioritization other than saying no to the many so you can say yes to the few?
However, being this extreme with our prioritization doesn’t come naturally. As we said, we tend to work on many things simultaneously.
We love to keep our options open and often be incredibly ambitious about our goals. Using the 5/25 rule allows you to split time and energy resources across a smaller number of goals, increasing the chances you’ll achieve them.
How to apply Buffet’s rule to everyday productivity?
We face many challenges daily, both professionally but also personally.
We live in a continuous battle against procrastination and distraction; the truth is, without healthy working practices, it’s a lot harder.
With accurate time management and selective focus, you can boost your life’s productivity, allowing you to reach your life goals and overall be more successful.
By adopting the 5/25 rule, you’re one step closer to truly spending time on what matters most to you and becoming more productive, whether in your workplace or at home.
Clear your head and genuinely focus on your goals. Here are some examples of how to apply the 5/25 rule daily:
Have a clear purpose for why you’re doing something. Find the true reason for every action you’ve planned in a daily schedule (find how to use a planner to organize your agenda);
Eliminate all your distractions and minimize procrastination;
Be organized and use tools to help you with your productivity, such as top time tracking tools or task automation software;
Use selective focus to follow your priorities and say no to all time wasters;
Prolonged focus is draining, so take regular breaks to refresh. For instance, take a walk, get some fresh air, step away from the screen, or do a little workout, whatever works for you!;
Buffett calls your B-list the “Avoid-At-All-Cost list” for good reason. Stopworrying about things outside the top 5. Set your top 5 realistic goals and stick to them if you want to become a high performer.
Find how to set realistic goals.
Conclusion
Does the Warren Buffet 5/25 rule work? Surely it helps you have some clarification on the goals you set for yourself and allows you to prioritize, which is key in the busy lives we’re currently living.
Warren Buffet believes in minimalism and simplicity. In his opinion, it’s truly important to get rid of “noise” in your head and to get rid of the waste that is pushing you away from accomplishing your ambitions.
With the 5/25 rule, you’re eliminating all the inessential things in your life that keep you from making your life easier and reaching your ultimate goals.
If you’re distracted by way too many goals, you won’t be able to succeed in what you really want.
It all comes up to this: would you rather make real progress and succeed or muddle through your objectives?
Even though you may have the best organizational skills, you’re probably splitting your energy and time between way too many things.
With Buffet’s 5/25 rule, you can make things easier for yourself and have a better shot at success!
You might be interested in:
- How to prioritize your tasks
- How to effectively manage your workload
- RICE – A method to prioritize your tasks
- The best time management techniques
- MoSCoW prioritization method
- Top-rated work prioritization apps
Sign up for more time management and productivity tips
