Bill Gates, Warren Buffett And Oprah All Use The 5-Hour Rule
Top business leaders use this simple daily habit to learn “breakthrough knowledge”, which helps them think faster and make better decisions. Here’s how to do the same…
Why has the world’s richest person, Bill Gates, read a book a week during his career? And why has he taken a yearly two-week reading vacation throughout his entire career?
Why has the best investor in history, Warren Buffett, invested 80% of his time in reading and thinking throughout his career?
Why did the busiest person in the world, former president Barack Obama, read an hour a day while in office?
Why do the world’s smartest and busiest people find one hour a day for deliberate learning (aka the 5-Hour Rule), while others make excuses about how busy they are?
- Oprah Winfrey credits books with much of her success: “Books were my pass to personal freedom.”
- Mark Zuckerberg reads at least one book every two weeks.
- Elon Musk grew up reading two books a day, according to his brother.
- Mark Cuban reads more than 3 hours every day.
- Arthur Blank, co-founder of Home Depot, reads two hours a day.
- Billionaire entrepreneur David Rubenstein reads six books a week.
- Dan Gilbert, self-made billionaire and owner of the Cleveland Cavaliers, reads one to two hours a day..
What do they see that others don’t?
The answer is simple: Learning is the single best investment of our time that we can make.
Or as Benjamin Franklin said, “An investment in knowledge pays the best interest.”
This insight is fundamental to succeeding in our knowledge economy, yet few people realize it…
Knowledge Is The New Money
“Intellectual capital will always trump financial capital.”
— Paul Tudor Jones, self-made billionaire entrepreneur, investor, and philanthropist
We spend our lives collecting, spending, lusting after, and worrying about money — in fact, when we say we “don’t have time” to learn something new, it’s usually because we are feverishly devoting our time to earning money.
But something is happening right now that’s changing the relationship between money and knowledge…
We are at the beginning of a period of what renowned futurist Peter Diamandis calls “rapid demonetization”, in which technology is rendering previously expensive products or services much cheaper — or even free.
This chart from Diamandis’ book Abundance shows how we’ve demonetized $900,000 worth of products and services you might have purchased between 1969 and 1989.
While goods and services are becoming demonetized, knowledge is becoming increasingly valuable.
Perhaps the best example of the rising value of knowledge is the self-driving car industry.
Sebastian Thrun, founder of Google X and Google’s self-driving car team, gives the example of Uber paying $700 million for Otto, a six-month-old company with 70 employees, and of GM spending $1 billion on their acquisition of Cruise. He concludes that in this industry:
“The going rate for talent these days is $10 million.”
That’s $10 million per skilled worker, and while that’s the most stunning example, it’s not just true for incredibly rare and lucrative technical skills.
People who identify skills needed for future jobs — e.g., data analyst, product designer, physical therapist — and quickly learn them are poised to win.
Those who work really hard throughout their career, but don’t take time out of their schedule to constantly learn will be the new “at-risk” group. They risk remaining stuck on the bottom rung of global competition, and they risk losing their jobs to automation, just as blue-collar workers did between 2000 and 2010 when robots replaced 85 percent of manufacturing jobs.
People at the bottom of the economic ladder are being squeezed more and compensated less, while those at the top have more opportunities and are paid more than ever before.
The irony is that the problem isn’t a lack of jobs.
Rather, it’s a lack of people with the right skills and knowledge to fill the jobs.
An Atlantic article captures the paradox:
“Employers across industries and regions have complained for years about a lack of skilled workers, and their complaints are borne out in U.S. employment data. In July , the number of job postings reached its highest level ever, at 5.8 million, and the unemployment rate was comfortably below the post-World War II average. But, at the same time, over 17 million Americans are either unemployed, not working but interested in finding work, or doing part-time work but aspiring to full-time work.”
In short, we can see how at a fundamental level knowledge is gradually becoming its own important and unique form of currency.
In other words, knowledge is the new money.
Similar to money, knowledge often serves as a medium of exchange and store of value.
But, unlike money, when you learn and apply knowledge, you don’t lose it. In fact, it’s the opposite. The more knowledge you learn and apply, the more you:
- Remember it
- Understand it
- Connect it to other ideas in your head
In other words, the value of knowledge compounds faster than money. It helps you accomplish your goals faster. It makes your brain work better. It expands your vocabulary, making you a more effective communicator. It helps you think more creatively. It connects you to powerful insights you didn’t even know existed. It can even be converted into many things that money can’t buy, such as authentic relationships, and a fulfilling, meaningful life.
Because knowledge is so valuable, that’s why some of the busiest people in the world invest their most precious resource — time — into learning…
Even when they’ve delegated almost every task in their life and businesses to the best and brightest.
And this is what I’ve ultimately come to as well:
At the highest levels, learning isn’t something you do to prepare for your work.
Learning is the most important work. It is the core competency to build. It’s the thing you never delegate. And it’s one of the ultimate drivers of long-term performance and success.
What’s The Best Way To Learn? Here’s What I Found…
So, if you get the importance and urgency of learning, here’s the question for you…
How can you learn proven, useful, impactful knowledge —
with the limited time you have?
How do you choose what to learn… with only 24 hours in a day?
My interest in this question is personal.
As someone who has read thousands of books across disciplines, I’ve asked it repeatedly throughout the years. There are hundreds of books scattered among my bookshelves, Amazon shopping cart, Kindle library, and Audible wish lists that I’d love to read, but don’t have time for.
Before I answer the question, first consider the following possibility…
Right now, somewhere out in the world is a paragraph, chapter, or book that would change your life forever if you read it.
I call this kind of information “breakthrough knowledge”.
Books that have “breakthrough knowledge” are rare, but one is worth a thousand merely good books. A “breakthrough knowledge” experience might only last a few minutes, but its effect can last a lifetime. It is the ultimate form of learning.
- For Warren Buffett, the book that gave him “breakthrough knowledge” was The Intelligent Investor, which he read when he was 19. This book cemented the core of the investment philosophy Buffett would use throughout his career.
- For Elon Musk, it was The Hitchhiker’s Guide to the Galaxy, which he said helped him ask bigger questions, and therefore think about addressing larger problems in the world.
- For me, it was Poor Charlie’s Almanack, written by self-made billionaire Charlie Munger (which I will get into later.)
Now, imagine learning “breakthrough knowledge” once a year, rather than just once a decade… Or even once a month!
Given the power of “breakthrough knowledge” — and the difficulty of finding it — the question you should then ask yourself is:
How can you find “breakthrough knowledge”
— with the limited time you have?
The obvious answer that you’ve probably heard is reading.
But here’s the problem with books that most people don’t realize…
Why Reading Books Are No Longer The Best Way To Learn
Thousands of books are being published every single day.
In fact, a writer found out that 2,790 new books were published on Amazon… in just 24 hours.
And most of them just aren’t great books that have “breakthrough knowledge”. The latest business bestseller? More likely a miss than a hit.
Even if you narrow down your options with book recommendations, you still will be left with hundreds of great books. (I know that very well myself, after combing through 50+ book lists of prominent entrepreneurs and executives.)
And even if you do find books that have “breakthrough knowledge”…
You still have to read through the entire book… just to find the few pages that will give you the most value.
Wouldn’t it be great if you can just read those few pages, and learn “breakthrough knowledge” right away?
This is where book summaries come in…
The Power — And Limitation — Of Book Summaries
Book summaries are valuable, since not all information within a book is created equal.
They provide the most concise description of the book’s main ideas, stories, exercises, and takeaways.
And there’s a huge demand for them: over the last five years, we’ve seen the rise of a cottage industry of these summaries.
Search for any bestseller on Amazon, and it’s likely you’ll see a few book summaries for purchase.
Search on Google, and you’ll see several for free.
Services like MentorBox, Blinkist, Get Abstract have catalogued thousands of book summaries in video, audio and text format.
But even the best book summaries have two limitations:
- They don’t always focus on the highest-quality knowledge that you can learn right now. In other words, they aren’t designed to help you learn “breakthrough knowledge”.
- Even if some of them have “breakthrough knowledge”, they aren’t designed to help you apply your new knowledge, so that you can get results in real-life situations.
That means you still have to spend a lot of time reading to get to the “breakthrough knowledge”, before the book summaries can actually be useful.
If Books And Book Summaries Aren’t The Best Ways To Learn “Breakthrough Knowledge”…What Then?
Being an entrepreneur and learner, I really wanted to figure out a better solution.
I thought to myself:
“There must be a more effective way to learn.”
To figure out the best, fastest way to learn, I read thousands of books across dozens of fields, talked with multiple experts, invested in seminars, coaching, and online courses, and even did hundreds of hours of research myself…
What I eventually found blew me away, and completely transformed my life.
The #1 “Breakthrough Knowledge” That Self-Made Billionaires, Accelerated Learners, Technology Investors, Successful Entrepreneurs, Highly-Paid Consultants & Coaches, & Cultural Creatives All Use….
In my quest to find “breakthrough knowledge”, I stumbled upon and read Poor Charlie’s Almanack.
Written by Charlie Munger — a self-made billionaire and Warren Buffett’s longtime business partner — this turned out to be the one book that changed my life.
In Poor Charlie’s Almanack, Charlie introduced mental models, and attributed them to much of his incredible business success.
He goes on to explain…
“You can’t really know anything if you just remember isolated facts and try and bang ’em back… You’ve got to have [mental] models in your head.”
So what are mental models, really? Let me explain…
You can think of a mental model simply as:
“The way you think that things work in a particular domain.”
It’s the idea that you have about how something works.
And just like you can build a model car or model plane to learn how the “real one” works… you can also build MENTAL models in your mind, in order to understand how success works in different areas of life.
If your model is bad, then your thinking is bad.
If your model is accurate, then your thinking (and decision-making, and prediction ability) is far more accurate.
Here’s some examples of powerful mental models… do any of these sound familiar?
According to this mental model, most of your results are going to come from just a small percentage of your effort or work.
According to this mental model, a small investment now yields surprisingly large returns over time.
It’s that simple.
All of us already use mental models in our lives… we just haven’t learned them systematically.
As I realized this myself…
BOOM! Suddenly, my entire reality changed.
No wonder when the world’s most successful entrepreneurs and leaders talk, it’s almost as if they’re speaking a different language!!
It’s because they think, decide and act in terms of mental models.
Here’s what Ray Dalio, self-made billionaire and the founder of one of the largest hedge funds, said about mental models:
“Those who understand more of them and understand [mental models] well know how to interact with the world more effectively than those who know fewer of them or know them less well. “
Elon Musk describes how he explains his mental model to make better decisions:
“I look at the future from the standpoint of probabilities. It’s like a branching stream of probabilities, and there are actions that we can take that affect those probabilities or that accelerate one thing or slow down another thing. I may introduce something new to the probability stream.”
The more I studied mental models, the more I naturally started to use them in my life and business outside of writing, and the better results I got. This was a game-changer for me.
The results I was getting weren’t just a little better. This wasn’t a little 5 or 10% change. It wasn’t even a 100% improvement. This was 10x, and in some cases 100x. It was a big deal.
Here’s the transformation I experienced because of mental models…
- I saw reality on a much deeper level — and on a fundamentally different level. I looked back on many of my old mistakes, and thought to myself, “Oh my God! If I had only known this or that mental model…” I wasn’t just learning new strategies or hacks… I was learning a deeper and fundamentally different way of understanding reality.
For example, 12 years ago, I borrowed $100,000 from friends, vendors, and banks (at high interest rates) to launch what I thought would be a world-changing company. Instead, the company died a slow, painful death.
Now that I understand mental models, I see how a bad mental model — “sunk cost fallacy” — caused my poor decision-making.
Today when I consider new business ideas, instead of just imagining how great they’re going to be, I also envision what could go wrong — a good mental model — saving a lot of my time and money upfront .
- I started having big, counterintuitive insights that often go viral… whereas previously my insights had been conventional and didn’t make any real impact.
In college, I had written hundreds of blog posts with the dream of becoming a writer, but things fizzled, and I feared the same thing would happen again. I knew what it felt like to be a mediocre writer.
After learning about the 80/20 Rule (which is now one of my favorite mental models), I started asking the most successful article writers what the 80/20 was for them. Almost all of them mentioned that titles were a key to success. Previously, I viewed the titles as just an afterthought.
Because of this insight, I now have a system where our team dedicates 5–10 hours per article creating new innovative words and terms, and also testing the titles of the articles before publishing them.
This is how my articles have been viewed tens of millions of times…with the average article now being viewed 150,000+ times.
- I started making a lot more money.
- I have had people hire me for six-figure consulting contracts.
- I began charging $250-$500 per hour as a coach and consultant.
- I even got a five-figure speaking gig from an article.
- When I launched a new company, we were able to create a business strategy based on “breakthrough knowledge” that is hard to replicate. This one strategy alone made us over 7-figures in revenue.
One night, I literally jumped on my couch like a little kid, elated that I was finally finding success and impact after so many years of struggle.
For the first time, rather than feeling like I was on a “hamster wheel” — always scrambling to keep up with the latest hacks and best practices — I felt like I had carved my own unique path to understanding not just career and business success, but life in general…
The feeling of figuring out a secret formula and seeing it work over and over was exhilarating.
Then I Put It To The Real Test
After discovering and using mental models in my own life, I started teaching them to friends and clients. I also started using them when doing projects for other companies.
I used it with one client who had almost no audience. No readers, no shares, no viral success. I used my mental models to help them write an article, and they got 30,000 views on the first article, and then it started to go viral. I did the math, and this was 175x better results than they had ever gotten before.
Another article I helped another client in another industry write had 100,000 readers and 20,000 shares.
I helped write something for a client on Quora, and it went crazy and got a million readers.
Another client wanted to use article writing to generate sales leads and customers, and the article we wrote got a half a million views, and made them $100,000 in sales very quickly.
These models were working everywhere I tried them.
Once I really understood mental models, and how powerful they were, I made a commitment to learning them for the long-term. I knew that I had discovered THE shortcut to getting better at anything in life quickly…
In other words, I realized that mental models are the #1 source of “breakthrough knowledge”.
Of course, once I realized this, I wanted to learn everything I could about mental models. So I went online and started researching mental models, reading books about them, and finding experts who understood them.
What I Found Actually Surprised Me…
There were almost no good books about mental models! Charlie Munger’s book got me interested in mental models, but it was a unique gem. Almost no one else was writing about them.
And when I searched online, I found a handful of people who were interested in models. They typically had a big list of mental models that were important to learn — but they didn’t explain the models, how to use them, and how to apply them.
Because mental models were so important, I realized that I was going to need to roll up my sleeves, and figure this out for myself. I couldn’t believe it, but there just wasn’t a systematic way to learn the most important mental models for success in business and life.
So I began reaching out to experts who understood mental models, making friends with people who used them, and generally trying to hack into this domain. I even co-hosted a mastermind with a bunch of PhDs and other experts from different domains who were all experts with mental models.
As I did this, I made lists of hundreds of different mental models from different domains. I wanted to identify the most important mental models, learn them, and then start using them in my life. (And because I knew the 80/20 Rule, I already knew that it was going to be a small number of models that really made the difference — which turned out to be correct.)
Over the past few years, I have now identified what I consider to be the most valuable and useful mental models in business and life. And more importantly, I’ve started teaching them to a serious group of thought leaders, entrepreneurs, investors, and other professionals.
Introducing The Mental Model Club
If you’re starting to understand the power of mental models, and you’re ready to go to the next level and learn the most important mental models to create success in your life, then I’d like to invite you to join our Mental Model Club.
Inside, every month you’ll learn one of the most important mental models and how to apply it to your life — in just 1–2 hours per month.
The Mental Model Club is an online course, community, and membership that teaches you the most valuable and useful mental models. We have almost 1,000 members from around the world, and we’re growing fast.
Inside the Mental Model Club, you’ll…
- Learn key mental models that are most critical for professional success (without feeling overwhelmed by all of the distracting information out there)
- Automatically apply mental models in your professional and personal life, without having to remember what you learned
- Use the right mental model in the right situation every time, so that you can think faster, smarter, make better decisions, get the results you want
- Avoid painful thinking and decision-making mistakes that set us back (most people aren’t even aware of these, because they are so hidden inside their minds)
Here’s What You Get Every Month…
✔ Your Mastery Manual
Every month, you receive one mental model in the form of a high-quality, comprehensive guide. I call it your Mastery Manual.
It’s the most condensed, in-depth explanation of any mental model that exists in the entire world. We take the best of what’s ever been said about the mental model, cut out all of the fluff, and organize it in a way that is easy and fast to learn.
In each Mastery Manual, you learn…
- A 101 Overview of the mental model (why it’s important, how it works, vocabulary, etc.)
- An advanced overview to give you the high-level summary, then an in-depth report that includes a more nuanced explanation
- Examples, tricks, and hacks you can use to apply the mental model to every area of your life and career
- Exercises, resources, & templates that you can use on a daily basis to integrate lessons in the manual and get results in your life.
✔ Your Monthly Masterclass
To help you learn your mental model knowledge faster, you also get a high quality, pre-recorded masterclass of the month’s mental model.
The monthly masterclass is deliberately designed as a standalone resource, so that you can get value right away — well, in just one hour of listening to it.
Here’s what you get in each pre-recorded masterclass:
- Concise “80/20” overview of the mental model: To help you understand and apply the mental model on a deeper level, I explain the most important ideas.
- Walkthrough of mental model exercises: I handpick exercises in the Mastery Manual, and coach you on using them.
- My answers to other Mental Model Club members’ questions: These are often common questions that people have about the mental model.
What Mental Model Club Members Are Saying…
“As a self-taught entrepreneur who has built five organizations (which employ over 60 people) on transforming education to include character building and skill development, I am blown away by the content in the Mental Model Club. Having read hundreds of books, without a doubt, it provides the most comprehensive training on mental models in the world. As an educator, I think we should be teaching everyone about mental models and, I’m impressed by Michael’s approach to teaching it.”
— Tijl Koenderink, Entrepreneur
“I’ve been a teacher, trainer, administrator and ultimately am an entrepreneur. I have been learning more from the Mental Models than anything else in my recent memory. The mastery manuals articulate concepts in a way that not only filled in my knowledge but gave me much better language to explain the concepts to others. The Mental Model Club provides actionable insights for a very reasonable price. I am enjoying being the first of my friends to recommend the club as it makes me feel smarter than everyone else who hasn’t found it yet.”
— Juliet Mee, Teacher, Trainer, Administrator, Entrepreneur
“I joined the Mental Model Club, so I could experience faster rates of growth in my personal life and career. The biggest benefit I’ve had from being a member so far is realizing how little of my potential I’m using and how much more I’m capable of. As a result of the 80/20 module I’ve 80/20'd my morning routine, what used to be a stressful anxiety inducing experience is now the cornerstone of me having an excellent day and has become a keystone habit. As a result of the goal setting module, I’m now enjoying a higher quality of life by spending more time in nature and more time with my wife. In a sea of intellectual mediocrity and information overload, the Mental Model Club is my 80/20 cubed of gaining actionable insight I can get to make real traction in my life.”
— David Pita, Project Manager, Digital Agency
“I joined the Mental Model Club just a month ago and not only my clarity has skyrocketed, since I no longer need to read a lot of books and lots of info. Because I know understand the mental models and thought processes behind them. Thanks to this club too, my business decisions are 10X better because I use the mental model checklists provided. As I scale to 7-figures this year this club is a must have for me. It keeps my thinking and mindset straight as I face some of the problems that come with scaling up.”
— Sergio Estevez, Entrepreneur
Try The Club Now For Just $1
As you become more successful in life, you have to do different things to get to the next level.
You can keep using trial & error, building your knowledge on a potentially shaky foundation. Keep risking making mistakes in your career, business and life.
you can get it right the first time, by investing in the Mental Model Club today.
When you register now, you’ll start by learning what we consider to be the most powerful mental model. You get a Mastery Manual and implementation exercises.
In less than an hour, you’ll be making better decisions, understanding the world better, and making better predictions and estimates about what’s going to happen.
Give Mental Model Club a try now: