You probably know the effects compound growth can have on an investment over a number of years.
With a long enough time and a sufficiently high interest rate, the growth is always impressive.
Warren Buffett has been preaching the importance of compound interest for six decades, and it’s made him billions.
Stephen Guise writes, “All who have been educated in basic finance know this about compound interest, but far too few think about their decisions in the same way, even though it works the same way.”
The principle of compounding also applies in many areas of our lives: health, fitness, personal development, productivity, business, and relationships.
Acting rationally, consistently, has long-term effects.
Life is a series of choices we make daily that add up to a large outcome.
Every decision is a seed planted for your future.
Good decisions … good outcome.
Bad decisions … bad outcome.
“It’s not the big things that add up in the end; it’s the hundreds, thousands, or millions of little things that separate the ordinary from the extraordinary, says Darren Hardy,” author of The Compound Effect.
Darren lays out a simple formula in the first chapter …
Small, Smart Choices + Consistency + Time = RADICAL DIFFERENCE
According to Darren, “Small, seemingly insignificant steps completed consistently over time will create a radical difference” in your life and put you on the road to the career success you want and deserve.
Compounding is not different from the 10,000 hour rule.
Malcolm Gladwell talks about it in his book, The Outliers.
Gladwell explains that reaching the 10,000-Hour Rule, which he considers the key to success in any field, is simply a matter of practicing a specific task that can be accomplished with 20 hours of work a week for 10 years.
Every action has consequences on your future.
Even the simplest choices compounds.
Actions taken over time GROW.
Darren explains, “The real cost of a four-dollar-a-day coffee habit over 20 years is $51,833.79. That’s the power of the Compound Effect.”
ACTING or NOT ACTING is a decision you shouldn’t take lightly.
Anything repeated over time ultimately creates a compounded result.
There are countless actions you can take everyday to reap the benefits of compounding:
Honing your skill one day at a time, reading just five pages of a great book, choosing to eat 100 calories less, working out for just 10 minutes a day, taking a few minutes walk daily, meditating for five minutes in the morning, drinking a glass of water when you wake up, getting up half an hour earlier to work on your passion project, expressing appreciation, starting a journal, saving a few dollars every month, and investing in your personal development even if it’s just a few minutes everyday, pays in the long-term.
In fact, after just a year, the difference will be huge in your life.
Cumulative discipline pays!
Some of our choices support our growth, and some don’t.
Choose your actions with care!
Simple errors in judgment, that don’t seem to make any difference today, can cost you tomorrow.
Becoming aware of your choices is the first step.
“The first step toward change is awareness. If you want to get from where you are to where you want to be, you have to start by becoming aware of the choices that lead you away from your desired destination,” writes Darren Hardy.
Making an informed choice today, not tomorrow, to mindful of your habits, actions, and decisions can change your life.
Compounded effect makes all the difference in the world.
You reap what you sow; you can’t get out of life what you’re not willing to put into it.
Today is the BIG day to make decisions you will be thankful for by this time next year.
You are at this point in your life because of the way you have treated every ‘today’ for decades.
You will never change your life until you change something you do daily. You can determine a better future, by making better decisions today.
You can reap huge rewards from a series of small, smart choices.
Ready to start a life-changing habit?
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This article first appeared on Medium.