The 10 worst decisions you can make in your life, according to Warren Buffett

Warren Buffett built one of the greatest fortunes in history, but ask him directly about it and he rarely talks about stock picking. He talks about mistakes. Over seven decades of letters to shareholders, campus discussions and interviews, he returned to the same mistakes, ones he saw ruin people who were smarter than him.

Below are ten decisions Buffett says can destroy a life, in his own words.

1. Marrying the wrong person

Buffett said that the choice of spouse trumps any career move you make. He explained it this way in a 2017 conversation with Bill Gates at Columbia University:

“You want to associate with people who are the kind of person you would like to be. You will move in that direction. And the most important person in that regard by far is your spouse. I can’t stress enough the importance of that.” –Warren Buffett.

He was married to Susan Buffett for over fifty years and later credited her with much of his personal stability. The people you leave closest to you, he argues, quietly pull your whole life in their direction, for better or worse.

2. Sitting idle during big opportunities

Buffett divides mistakes into two categories. There are errors of commission, things you did that failed, and errors of omission, good actions you saw clearly and never took. He said the second type hurt a lot more.

“The biggest mistakes I made, by far, were errors of omission, not of commission. I mean, those were the things that I was pretty good at doing, and I was sucking my thumb. Those were the ones that hurt.” –Warren Buffett.

A bad investment costs you money. A good opportunity that you understood and passed up costs you the version of your life that you could have had.

3. Pretending to know everything

Buffett’s “circle of competence” is one of his oldest ideas and one of the simplest. Stay within what you truly understand. Get out of it, whether in a job, a relationship, or an investment, and you’re guessing by calling it knowledge.

“What an investor needs is to be able to properly evaluate the selected companies. Note that the word is selected. You do not need to be an expert on every company. The size of your circle of competence is not very important. Knowing your limits is vital, however.” –Warren Buffett.

Failure is not ignorance. Buffett’s view is more subtle than that. Failure is not knowing where your own ignorance begins.

4. Chase away a toxic path to escape from stubbornness

Buffett’s biggest regret, he says, was buying Berkshire Hathaway itself. It was a dying textile mill when he bought it, partly out of malice toward the man who ran it. He spent twenty years trying to save a company with poor underlying economics before finally abandoning the textile business and rebuilding the company around insurance.

“When a manager with a reputation for being brilliant meets a company with a reputation for bad economics, it’s the reputation of the company that remains intact.” –Warren Buffett.

Staying in a losing situation because you’ve already invested years, money, or pride rarely saves it. This usually just adds years to the loss.

5. Trade your reputation for a quick win

A career built over decades. A big wedding. A name people trust. Buffett warned that all of this can be undone in one bad moment and that the math of this trade does not favor the shortcut.

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about it, you’ll do things differently.” –Warren Buffett.

He told Berkshire executives directly that he could absorb the losses. Loss of reputation is another matter entirely, and much more difficult to recover.

6. Let desire take the lead

Buffett and his late partner, Charlie Munger, kept returning to this theme at Berkshire’s annual meetings. Of all vices, they said, envy is particularly useless, because it offers no advantage, not even bad pleasure.

Charlie Munger said: “It is not greed that drives the world, but envy.” Buffett expanded on this idea in his own words: “My partner Charlie says envy is the only one of the deadly sins where you don’t have fun. Gluttony, you can eat. Lust, you have a good time. But envy just makes you feel bad.” –Warren Buffett.

Watching someone else win and wanting what they have does nothing to them. It only costs you your own concentration.

7. Trade what you need for what you want

Buffett has little patience for people, or companies, who endanger something essential to chase something they don’t actually need. He said the odds hardly mattered once the stakes were set that way.

“If you’re risking something that’s important to you for something that doesn’t matter to you, it just doesn’t make sense. It doesn’t matter if the odds are 99 to 1 or 1,000 to 1.” –Warren Buffett.

That’s why Berkshire avoids leverage that could sink the company even in long-term difficulties. A small, almost certain gain is never worth a small chance of losing everything.

8. Letting emotions hijack your intellect

A high IQ doesn’t do you much good if panic or excitement drives decisions. Buffett has argued for years that temperament matters more than raw intelligence, in investing and elsewhere.

“If you can’t control your emotions, you can’t control your money. You want a stable personality. You need a temperament that doesn’t take much pleasure in being with the crowd or against the crowd.” –Warren Buffett.

It doesn’t describe someone who doesn’t feel anything. It describes someone who can feel abundance while acting on evidence rather than adrenaline.

9. Postponing your life for a future that is not guaranteed

Buffett bluntly told students that staying in a job you don’t like, just because it will look good later, is a bad job. He used one of his most memorable similes to make his point.

“I think you’re losing your mind if you keep taking jobs you don’t like because you think it will look good on your CV. Isn’t that a bit like saving sex for your old age?” –Warren Buffett.

The CV is built anyway. What doesn’t come back are the years spent waiting.

10. Not adopting good habits while you are young

Buffett compared your body and mind to a car that is given to you once, with no trade-in or replacement. He advises young audiences to address them early, because bad habits are much easier to avoid than to break.

“The chains of habit are too light to feel until they are too heavy to be broken.” –Warren Buffett.

Buffett has used this phrase for decades in his discussions with students, and he has made it clear that the idea did not come from him. What matters, he says, is that the habits you get rid of at twenty are the ones that run your life at sixty.

Conclusion

Buffett’s advice rarely seems complicated, and that’s kind of the problem. Protect the people closest to you. Stay within what you truly understand. Guard your name like it’s worth more than any transaction, because it is.

None of these ten decisions require genius to avoid. They require honesty about what you already know and the discipline to act on it before the cost is due.