It’s true that no two careers are identical, but that seems especially accurate in the case of Warren Buffett.
He’s the man who started out slinging newspapers, but now spends five to six hours a day reading them, keeping a close eye on market trends and his 100 billion dollar empire.
As much as he’s revered for his business savvy, he’s known for coming up with brilliant wisdom that goes beyond Wall Street. For career advice, you’d struggle to find many people more insightful than Buffett, even if he was telling you to avoid your goals.
With a rule for everything, Buffett could definitely write some profound pages on productivity. Strangely enough, he’s never authored a book, but his 5/25 rule would surely crop up early.
Warren Buffett's 5/25 rule is an exercise used to help people focus on their most valued aims, the life pursuits that seem most meaningful.
The 5/25 rule can be applied to personal or professional targets, family time or career goals, making it an effective, simple technique for prioritizing all aspects of life.
Making lists of goals isn’t anything new. In fact, it’s the typical first step in countless goal-setting methods. It’s Buffett’s brand of prioritization that makes this rule so unique, an aggressive alignment with minimalism, keeping the bulk of goals at bay in favor of a select few.
The 5/25 rule is precisely how you prioritize like Warren Buffett, focusing solely on/committing fully to a minimal number of goals, thus raising the chance of completing them more effectively than if you had juggled all of your goals at once.
It feels counterintuitive as we assume doing more is better, in terms of speed and quality. In actuality, focusing on less is entirely logical, exactly what our single-focused brains love to do. The story of such an out-of-the-box idea begins exactly where you’d expect – 35,000 feet in the air.
The origin of this pro-prioritizing rule isn’t totally agreed upon; it’s most likely something that business magnate Buffett has incorporated throughout his career.
With that being said, public knowledge of the 5/25 rule sprung from a conversation between Buffett and his personal pilot, Mike Flint.
Having previously flown four presidents in Air Force One, Flint knew a little about the uber-successful, so it seems natural that he would be curious about their secrets. As Flint’s account goes, he was discussing his career with Buffett, who promptly instructed him to write down 25 professional priorities. As soon as Flint had done so, Buffett told him to then circle the 5 most important items.
Scrupulously perusing the list, Flint eventually had his top 5 career goals circled. In effect, this presidential pilot now had two lists: the list of 25, the B-list, and the top 5 goals, the A-list. Catching on quickly, Flint reassured Buffett that the A-list would be his primary focus. When asked what he would do with the B-list, Flint replied that he would commit some time and energy to the others, as he deemed appropriate.
“No. You’ve got it wrong, Mike,” Buffett is quoted as saying, “Everything you didn’t circle just became your Avoid-At-All-Cost list.”
Perplexed, Flint asked for clarification. Buffett concisely told his dear friend that, if he was seriously interested in achieving these career goals, he must give zero attention to the B-list, working towards the 5, not the 25. Upon completing his top goals, Flint could repeat the process, adding new goals to the B-list, from which a new A-list would be created.
It’s deceptively simple, actually. The 5/25 rule works because you’re essentially acknowledging the exceptionally simple fact that you can’t focus on lots of things at once.
Just as you can’t hold down 25 jobs, you can’t work towards 25 goals at once.
For a goal to get on the list, it must hold value and/or meaning. However, the circled goals are, by definition, the most valuable, therefore the most deserving of your efforts.
This constant state of ruthless prioritization is characteristic of Buffett’s business philosophy. “The difference between successful people and really successful people,” reads one of his most famous quotes, “is that really successful people say no to almost everything."
After all, what is prioritization other than saying no to the many in order to say yes to the few?
Every single choice leaves the majority of options unchosen, thus prioritization is not simply a productivity hack enjoyed by Warren Buffett, but a fact of life experienced by all.
Though, being brutal with our prioritization doesn’t come naturally. We love to keep our options open, often incredibly ambitious about how many goals can be met. Forcing oneself to commit to the best 5 of 25 objectives allows you to split resources across a smaller number of goals, increasing the chances you’ll achieve them.
The 5/25 rule is a handy exercise for all the goals in your life but, for Mike Flint, it was sold as a career management tool. It’s especially useful as such because a career plan will contain a vast number of goals. Following the Buffett ideology allows you to view long-term prospects as specific goals.
If you’re an employee, you will likely have a list of professional goals for your career. If you are a manager, your goals will extend to you team, and an executive, your company. The process remains the same, and it goes exactly like this:
1. Write down a list of your top 25 career goals. These can be short-term (getting a qualification or promotion) or long-term (starting your own business).
2. Decide on the five most important goals of these 25 by circling the top 5 items. You can choose goals based on their perceived value, meaning, relevance, results or urgency.
3. Take your carefully crafted list of 25 and eliminate 80% of it. Don’t put your lower 20 in the calendar, don’t save them for a rainy day, and don’t even let them keep living on the page – cross them out. Yes, even if you don’t want to… actually, especially if you don’t want to!
By eliminating the majority of your goals, you’re consciously classifying them into one or two categories: do or do not. You use the 5/25 rule to help you focus on the most important goals first and avoid being distracted by less important items. This effectively frees up some mental resource, whereby you’re not worrying about too many ambitions.
In other words, keeping your objectives narrow better accommodates selective focus, the ability to direct your attention to one goal and block out distractions. It’s a skill that ultimately helps you get more done in less time, and it’s required for everyday time-management, as in time-blocking, as well as general long-term success at work.
As we now already know, Buffett’s 5/25 Rule is as much about saying no to goals as it is saying yes. However, it’s more a “don’t start what you can’t finish” attitude, rather than full-blown rejection of future aims.
The presumption is that you have the opportunity to revisit the eliminated goals later, but never right now.
It’s systemically achieving a smaller set of goals, instead of having insignificant progress with many. Saying no, in Buffett’s eyes, is the major difference between periodic chunks of success and getting stuck with one half-finished mess of a to-do list.
So how do you learn to say no to a goal? The trick with many of these productivity hacks is to use them in conjunction with each other.
Prioritizing proves rather difficult for some of us, so it may be useful to find a complementary productivity system that aids you in making tough decisions.
The Eisenhower Decision Matrix, as example, works on the premise that not all important tasks are urgent, and vice versa. Using it can quickly teach you that a large proportion of what we consider important actually isn’t, especially insightful for long-term goal striving. It’s a visual technique that can greatly benefit those who value more illustrated forms of task-organization.
Warren Buffet’s 5/25 rule isn’t going to get you all the way. It’s top-down planning, which is great for visualizing the future, requires breaking down into smaller steps before it becomes actionable. Combining it with a bottom-up system will yield better results.
David Allen’s Getting Things Done (GTD) method is a day-to-day system that can help you translate long-term career goals into clear actions and positive behaviors. As a bonus, such a system has its own prioritization process to determine whether a pursuit is worthwhile before you bother committing it to a calendar or future pile.
Note: Review our picks for the best goal-setting software.
There’s not many who have success quite like Warren Buffett does, partly because of the sheer dedication and perseverance that his business principles demand. It’s a continuous battle against procrastination and distraction, one which you will lose without reliable and healthy working practices.
It wouldn’t hurt to improve your focus if you’re thinking about adopting the 5/25 rule.
We won’t go into great detail here, but there’s quite a number of ways to be more productive. Clear your head and getting stuck into your goals:
1) Have a clear purpose for why you are doing something. (e.g. assess the reason for every action you’ve planned in a daily schedule)
2) Eliminate distractions and minimize interruptions
3) Be organized and have an efficient system in place (e.g. use an online planner, not a paper calendar)
4) Use selective focus to follow your priorities (e.g. don't multi-task, but single-task instead!)
5) Prolonged focus is draining, so take regular breaks to refresh (e.g. take a walk, get some fresh air, step away from the screen)
6) Buffett calls it an “Avoid-At-All-Cost list” for good reason – don’t waste time worrying about things outside the top 5 (e.g. if an opportunity to work on another goal presents itself, resist and stick to your set 5 priorities)
Making difficult choices is obviously a regular occurrence in the day of Warren Buffett, a man with arguably the best ever investment track record. His career started from three shares of Cities Service Preferred, at $38 per share, all the way to his record $139 billion investment in Apple. It’s no coincidence that the majority of Buffet’s stock value comes from just a handful of holdings,
This is a man who has definitely practiced what he preached to pilot Mike Flint, all those years ago.
His curated selection proof that he is a man of firm priorities, one whom will focus on the lucrative few, not the confusing mass. When it comes to setting goals, it’s really no different. Invest in your top 5, ignore the rest, and you’ll soon see some nice returns!