In The Psychology of Money, Morgan Housel tells the tragic story of Jesse Livermore, a Great Depression-era stock trader whose success was spectacular—until it wasn’t. While many people lost money during the crash of 1929, Livermore shorted the market and made a handsome profit.
Sounds impressive, right? The problem is, Livermore couldn’t retain his wealth. His early contrarian bets bred overconfidence, and he later made several risky investments that didn’t turn out so well. Sadly, after encountering financial ruin, he died by suicide.
Now contrast Livermore with Warren Buffett—widely hailed as one of the world’s greatest investors. Buffett is known for his cautious but canny approach: he accumulates lots of cash, stays on the sideline, and then swoops in with a big move when he smells a good deal.
But if you’re a fan of Buffett—and he does have something of a cult following—you’ll know he freely admits his mistakes and his lack of knowledge. Buffett has said he underestimated the growth potential of companies like Amazon. He didn’t jump in to buy Amazon stock during the early years of its meteoric rise. In fact, with only a few exceptions, Buffett avoids buying tech stocks—not because he doesn’t believe in them, but because he acknowledges he lacks the expertise to assess their valuation.
You probably knew this article isn’t about investments or stocks. I offer absolutely no advice whatsoever on what you should invest in. Rather, I think Buffett possesses a critical virtue that Livermore lacked.
The difference between the two? In one word: humility.
Rethinking Humility
Humility is truly life’s most underrated virtue. Not because it’s superior to all others, but because it’s misunderstood, underappreciated, and underutilized.
Many people recognize humility as a virtue—just not one that fuels success. They may imagine humble people as nice and harmless but not particularly ambitious or accomplished.
The problem lies in how we define humility. So let’s begin with what humility is not.
Humility is not low self-esteem or self-loathing. A humble person can be confident, ambitious, and proud of their achievements.
So what is humility?
Not all researchers agree, but synthesizing the work of various scholars, here’s where I land: at its core, humility is a lack of self-importance. This de-prioritization of the self enables humble people to (a) view themselves accurately and recognize their limitations, (b) be open to learning and growth, and (c) attend to the needs of others (Davis et al., 2011; Tangney, 2000; Wright et al., 2017).
Let me unpack this. Because humble people are not preoccupied with themselves, they aren’t easily threatened by negative feedback. Their ego is neither inflated nor fragile. They recognize both strengths and limitations. This frees them to admit mistakes, laugh at themselves, apologize when they’ve wronged others, and seek help where they’re lacking. Humble people recognize they have legitimate needs—they aren’t doormats. Yet they also understand they don’t reside at the center of the universe. This lack of self-importance enables them to take an interest in others and value others’ needs—not just their own.
If you’ve read my earlier piece on the biggest obstacle to gratitude, you might notice that humility is almost the mirror image of narcissism. Narcissists obsess over their social image and their own needs; humble people do not.
There’s a famous “quote” by C. S. Lewis floating around the Internet: “Humility is not thinking less of yourself but thinking of yourself less.” But these weren’t his exact words. What Lewis actually wrote cuts deeper—it’s not only dialing down self-focus but also turning up our focus on others:
Do not imagine that if you meet a really humble person he will be what most people call “humble” nowadays: he will not be a sort of greasy, swarmy person telling you that, of course, he is a nobody. Probably all you will think about him is that he seems a cheerful, intelligent chap who took a real interest in what you said to him. If you do dislike him it will be because you feel a little envious of anyone who seems to enjoy life so easily. He will not be thinking about humility: he will not be thinking about himself at all [emphasis added].
Humility vs. Narcissism
Let’s explore how humility plays out in everyday life by contrasting humble and narcissistic responses.
Scenario 1: Someone offers you unsolicited constructive feedback. It’s a bit harsh, but after thinking about it, you realize it’s largely true.
Narcissistic response: You fly into a rage. “How dare you criticize me!” You counterattack, criticize them, damage the relationship, and lose an opportunity for growth. You continue repeating the same mistakes the feedback might have helped you correct.
Humble response: You acknowledge that the feedback stung, and you also thank the person for helping you recognize a blind spot. You’ve strengthened a relationship and embraced an opportunity for growth.
Scenario 2: During a two-hour flight, you strike up a conversation with the person beside you. He’s a truck driver.
Narcissistic response: You ask one question, then pivot to talking about yourself—your accomplishments, vacations, and hobbies. You leave the conversation pleased because you had an attentive audience.
Humble response: You share about yourself but also, like the humble person Lewis described, you take a genuine interest in him. You’re curious about his work, ask thoughtful questions (e.g., “What is the best and worst part about being a truck driver?”), and end the flight having learned something new and made a connection.
What We Miss About Success
The idea that humble people are nice but unsuccessful is a myth. Research on leadership shows that humble leaders produce better organizational outcomes, such as better task performance among employees. Humble leaders admit mistakes, prioritize others’ needs, and avoid drawing excessive attention to themselves, which earns trust.
Because humble people are more willing to seek help and feedback, they learn and grow. Over time, they become more effective. As a professor, I’ve noticed that the students to whom I give the most constructive feedback aren’t necessarily those who struggle—they’re the ones who aren’t defensive and are eager to learn. These students embody humility, and they end up learning the most. When students are defensive, I struggle to give them feedback, and over time, they stagnate.
Humble people also recognize the role of G-d in their success.
Recognizing the role of G-d has several benefits. It makes us more grateful. But there’s more. Returning to Livermore and Buffett, I suspect Livermore failed to grasp the role of G-d in his early success. By attributing everything to his own uncanny abilities, he took increasingly reckless risks that ultimately ruined him.
Conversely, acknowledging G-d and the limits of our abilities—that’s humility in action—keeps us from making unnecessarily risky decisions. This is part of Buffett’s enduring success as an investor.
How Humility Fuels Gratitude
Research shows that gratitude and humility mutually reinforce each other: humility fosters gratitude, and gratitude deepens humility.
If you consider the seven foundational principles for living gratefully, humility sits at the core. Gratitude requires recognizing that many of our benefits come from external sources, including luck—this requires humility. The abundance mindset—the belief that we’ve received more than we’re entitled to—is premised on a lack of self-importance. Humble people, and therefore grateful people, recognize how fortunate they are and live with wonder at the gifts in their lives.
Do you want to be more grateful? Start by embracing humility.
Let’s Practice Humility
If you value humility, pursue it not because it will make you successful—that’s incidental—but because it helps you live a good and meaningful life.
The path to humility doesn’t lie in extensive self-analysis (e.g., constantly asking yourself whether you’re humble)—that can morph into another form of self-preoccupation—but in humble practices. Look at the list below and challenge yourself to try at least one this week:
If you’re used to helping others, try asking for help instead.
If you think you know a lot, acknowledge to others something you don’t know.
If you’re very aware of your strengths, but not your weaknesses, ask someone who knows you well for honest feedback.
If you typically credit your success solely to your talents, pause to consider how others and G-d play a role.
If you tend to talk about yourself a lot, pull back and focus on getting to know someone else.
If you enjoy the spotlight, shine it on someone else—celebrate them, praise them, encourage them, thank them.
In the end, the humble life naturally becomes the grateful one—and that’s a life worth living.
