<ol><li>Hold stocks for the long term</li><li>Be choosy about where to invest - by understanding the business</li><li>Ask yourself"Is the business going to keep producing more money all the time?"</li><li>Extreme diversification is the right approach if you do not have enough time to sort through the businesses. The solution is low-cost index tracker funds</li><li>If you have time to  put in the effort, try to find about 6 wonderful businesses.</li></ol>

How to use Buffet's 5 tips to build Wealth

"What we really want to do is buy businesses that we will be happy to hold forever"

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<div><a href="https://www.fool.co.uk/" dir="ltr">Home</a> » <a href="https://www.fool.co.uk/category/investing/" dir="ltr">Investing Articles</a> » With no savings at 30, I’d use Warren Buffett’s 5 tips to build wealth</div><h1>With no savings at 30, I’d use Warren Buffett’s 5 tips to build wealth</h1>If I’d learnt about these five Warren Buffett tips at the age of 30, I’d likely be a lot richer now… and here’s why.<figure><img width="733" height="413" alt="Warren Buffett at a Berkshire Hathaway AGM" src="data:image/svg+xml;nitro-empty-id=MTYzMToxMTM1-1;base64,PHN2ZyB2aWV3Qm94PSIwIDAgMTQwMCA3ODgiIHdpZHRoPSIxNDAwIiBoZWlnaHQ9Ijc4OCIgeG1sbnM9Imh0dHA6Ly93d3cudzMub3JnLzIwMDAvc3ZnIj48L3N2Zz4="><figcaption dir="auto">Image source: The Motley Fool</figcaption></figure>Billionaire investor&nbsp;<a href="https://www.fool.co.uk/investing-basics/great-investors/warren-buffett/" dir="ltr">Warren Buffett</a>&nbsp;has spent a lifetime ‘eating his own cooking’ when it came to investment advice. Over the years, he’s been as keen to teach as he has been to invest. And it’s clear from his portfolio and performance that he does what he says with his investment strategy.I was once 30 with no meaningful savings. But if I could go back in time and talk to my younger (and poorer) self, I’d whisper the words ‘Warren Buffett’ in that young man’s ear. And that’s because using five of his tricks as a foundation for investing could potentially have delivered meaningful returns between the age of 30 and retirement.Buffett’s been consistent in his advice for many years. And around 24 years ago, he delivered a fascinating lecture to some students at The University of Florida. He gave them lots of advice and he still appears to use it himself today. The only thing that’s changed is the vast increase in his wealth since!Here are some of the things he said:<h2>A long-term approach</h2>“What we really want to do is buy businesses that we will be happy to hold forever.”In that statement, there’s no mistaking Buffett’s intention to hold stocks for the long term. And that’s the first tip. However, he went on to say,&nbsp;“we can’t find a lot of them.”&nbsp;&nbsp;Buffett researches his potential investments thoroughly and most don’t make the grade. So tip two is to be very choosy about where to invest. He told those students that investing is about using money to get more money back later. And&nbsp;“to do that you have to understand the business.”He recommended they ask themselves the question, is the business going to keep producing more money all the time? And if the answer is yes,&nbsp;“then you don’t need to ask any more questions.”&nbsp;For me, that’s tip three. Buffett focuses on the potential for businesses to increase their earnings over time.<h2>Diversification versus concentration</h2>However, Buffett acknowledged that not everyone will have the stamina, time and focus to invest in his style. So he offered a two-track method that could help investors. The first track is tip four, to me. Buffett believes that&nbsp;“extreme diversification”&nbsp;is the right approach for those without the time or inclination to invest. And to him, that means investing in low-cost&nbsp;<a href="https://www.fool.co.uk/investing-basics/isas-and-investment-funds/introducing-the-index-tracker/" dir="ltr">index tracker funds</a>.But track two is&nbsp;“for those willing to put in the required effort”.&nbsp;And, under those circumstances, he said that wide diversification between stocks&nbsp;“is a terrible mistake.”&nbsp;He went as far as to say that&nbsp;“six wonderful businesses” is all that most committed investors need. And that’s tip five, for me.However, despite investing for a long time now, I’ve yet to find my six wonderful businesses. Investing like Buffett might sound simple, but it’s not easy. My personal approach today involves following both tracks simultaneously. But I’m not a billionaire and I haven’t yet got a portfolio as small as six stocks!Nevertheless, I do wish I’d learnt of these five Buffett tips when I was 30.Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.<h2>More on Investing Articles</h2><img width="733" height="412" alt="Young woman sat at laptop by a window" src="https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch.jpg" srcset="https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch.jpg 1000w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-300x169.jpg 300w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-225x127.jpg 225w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-125x70.jpg 125w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-400x225.jpg 400w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-600x338.jpg 600w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-800x450.jpg 800w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-343x193.jpg 343w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-768x432.jpg 768w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-663x373.jpg 663w, https://cdn-dfoll.nitrocdn.com/tSUsPcuDMaCDjkKGRxswpkeBalYirhyT/assets/static/optimized/rev-3feab25/wp-content/uploads/2018/01/ShareResearch-724x407.jpg 724w">

This article provides two key tracks about investment in terms of time available. 

If I'd learnt about these five Warren Buffett tips at the age of 30, I'd likely be a lot richer now... and here's why.

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With no savings at 30, I’d use Warren Buffett’s 5 tips to build wealth

If I’d learnt about these five Warren Buffett tips at the age of 30, I’d likely be a lot richer now… and here’s why.

Billionaire investor <a href="https://www.fool.co.uk/investing-basics/great-investors/warren-buffett/">Warren Buffett </a> has spent a lifetime ‘eating his own cooking’ when it came to investment advice. Over the years, he’s been as keen to teach as he has been to invest. And it’s clear from his portfolio and performance that he does what he says with his investment strategy.

I was once 30 with no meaningful savings. But if I could go back in time and talk to my younger (and poorer) self, I’d whisper the words ‘Warren Buffett’ in that young man’s ear. And that’s because using five of his tricks as a foundation for investing could potentially have delivered meaningful returns between the age of 30 and retirement.

Buffett’s been consistent in his advice for many years. And around 24 years ago, he delivered a fascinating lecture to some students at The University of Florida. He gave them lots of advice and he still appears to use it himself today. The only thing that’s changed is the vast increase in his wealth since!

Here are some of the things he said:

“What we really want to do is buy businesses that we will be happy to hold forever.”

In that statement, there’s no mistaking Buffett’s intention to hold stocks for the long term. And that’s the first tip. However, he went on to say, “we can’t find a lot of them.”

Buffett researches his potential investments thoroughly and most don’t make the grade. So tip two is to be very choosy about where to invest. He told those students that investing is about using money to get more money back later. And “to do that you have to understand the business.”

He recommended they ask themselves the question, is the business going to keep producing more money all the time? And if the answer is yes, “then you don’t need to ask any more questions.”

For me, that’s tip three. Buffett focuses on the potential for businesses to increase their earnings over time.

However, Buffett acknowledged that not everyone will have the stamina, time and focus to invest in his style. So he offered a two-track method that could help investors. The first track is tip four, to me. Buffett believes that “extreme diversification”  is the right approach for those without the time or inclination to invest. And to him, that means investing in low-cost <a href="https://www.fool.co.uk/investing-basics/isas-and-investment-funds/introducing-the-index-tracker/">index tracker funds </a>.

But track two is “for those willing to put in the required effort”.  And, under those circumstances, he said that wide diversification between stocks “is a terrible mistake.”  He went as far as to say that “six wonderful businesses ” is all that most committed investors need. And that’s tip five, for me.

However, despite investing for a long time now, I’ve yet to find my six wonderful businesses. Investing like Buffett might sound simple, but it’s not easy. My personal approach today involves following both tracks simultaneously. But I’m not a billionaire and I haven’t yet got a portfolio as small as six stocks!

Nevertheless, I do wish I’d learnt of these five Buffett tips when I was 30.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.

With no savings at 30, I'd use Warren Buffett's 5 tips to build wealth

How to use Buffet's 5 tips to build Wealth

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