The Compound Effect

1. Larry didn’t change his routine, he did like he was doing always.
2. Scott started making some small, seemingly inconsequential, positive changes like reading 10 pages of a good book per day, 20 minutes of podcasts, cutting 125 calories from his diet every day, and walking a couple of extra steps daily. No big deal of bravery or grand effort was done. Doable? Yeah.
3. Brad, makes some poor choices, he bought a big screen TV, so he can watch more of his favorite programs, tried out new recipes on the food channel, and installed a bar in his room which added a few drinks per week. Nothing crazy, Right?

At the end of 5-10 months, we can’t see any noticeable changes in any of their lives. They continued whatever they were doing.

But at about month 25, we start seeing really measurable, visible differences.

After 31 months or 940 days, When a detailed examination was done

1. Brad got fatty because he ate 125 calories more than Scott, so he gained 33.5 pounds weight. Now he weighs 67 pounds more than Scott.
2. Scott besides being slim, light & active, gained great pieces of knowledge from books and podcasts. He got good raise and got promoted. His marriage is thriving.
3. Larry is pretty much same as he was.

To understand this, we can put only 1 bad habit of Brad under the microscope—eating rich food more frequently—to know how the compound effect can work in a negative way and can create a ripple effect that impacts the whole life.

• As we already know, he makes recipes that he learned from TV, he makes some great desserts, and the family loves that, so he makes more of that and takes some extra share from that sweet.
• This extra food makes him sluggish at night and wakes up a little groggy, which makes him cranky. This crankiness and sleep deprivation impacts his work performance, so gets insulted.

• As he gets discouraging feedback from his boss, his energy level is way down, his commute seems longer and more stressful than ever. All this makes him reach for more comfort food (stress has a way of doing that).
• So, he is now less likely to walk with his wife, like he used to. She misses their time together.
• Now with fewer shared activities with his wife and an absence of fresh air and exercise, Brad is not getting the endorphin release, that can make him feel upbeat and enthusiastic.
• Because he is not happy, he starts finding fault with himself & others, stop complimenting his wife like before

• Brad’s own self-esteem goes down, he started escaping from reality and starts losing himself in late-night TV shows.
• His wife starts to complain, then becomes needy. When that doesn’t work, she emotionally withdraws to protect herself. She’s lonely. She spends more time with her girlfriends to fulfill her need for companionship. Men start flirting with her, which makes her feel desirable again. She would never cheat, but Brad feels that something’s wrong.
• Instead of seeing that his poor choices and behaviors are the base of all these problems, he finds fault with his wife. Relationship is now ❌.

The most challenging aspect of the Compound Effect is that we have to keep working away for a while, consistently and efficiently, before we can begin to see the payoff. Our parents & grandparents knew this, they didn’t spend their money & time binge-watching, buying unusable stuff to get thinner, etc.

Wealth tends to skip a generation.

Why, because overwhelming abundance often leads to a lackadaisical mentality, which brings a sedentary lifestyle. Children of the wealthy are more susceptible. They weren’t the ones who developed the discipline and character to create wealth in the first place.

Understanding the compound effect will rid you of “instant-results” expectations.

Promise yourself that you’re going to let go once and for all of your lottery-winner expectations because, let’s face it, you only hear stories about the one winner, not the millions of losers. That person you see jumping up and down in front of the Vegas slot machine or at the Santa Anita horse track doesn’t reveal the hundreds of times that same person lost. If we go back to our mathematical chance of a positive result, again, we have a rounding error of zero—as in, you have about zero chance of winning.

Harvard psychologist Daniel Gilbert, author of Stumbling on Happiness, says that if we gave lottery losers every thirty seconds on TV to announce not, “I won!” but “I lost,” it would take almost nine years to get through the losers of a single drawing!

Don’t try to fool yourself into believing that a mega-successful athlete didn’t live through regular bone-crushing drills and thousands of hours of practice. He got up early to practice—and kept practicing long after all others had stopped. He faced the frustration of the failure, loneliness, hard work, and disappointment it took to become No. 1.

We all come into this world the same: naked, scared, and ignorant. After that grand entrance, the life we end up with is simply an accumulation of all the choices we make. Our choices can be our best friend or our worst enemy. They can deliver us to our goals or send us orbiting into a galaxy far, far away.

Think about it. Everything in your life exists because you first made a choice about something. Choices are at the root of every one of your results. Each choice starts a behavior that over time becomes a habit.

Either you choose any habit or if you don’t, you get another option automatically

-Mosquito does. It means our very small, negligible choices every day affects us more than the big ones.

e.g. you inhale a soda and bag of potato chips and suddenly realize only after you polished off the last chip that you blew an entire day of healthy eating—and you weren’t even hungry. You get caught up and lose two hours watching mindless TV—scratch that, let’s give you some credit and make it an educational documentary—before realizing you spaced on preparing for an important presentation to land a valuable client.

You have allowed yourself to make a choice without thinking.

CHOOSE WISELY.

We are all self-made humans, but only the successful take credit for it.

In a seminar author attended, speaker asked, “What percentage of shared responsibility do you have in making a relationship work?”

People blurted and yelled different answers like 50-50, 80-20, 49-51 etc etc.

The speaker turned to the easel and wrote 100-0 on the paper and said “You have to be willing to give 100 percent with zero expectation of receiving anything in return.”

When you don’t take 100% responsibility, you opt for finger-pointing, victimhood, blaming, and expecting someone else/government to solve your problems.

Preparation (personal growth, skills, knowledge, expertise, relationships, resources) + Attitude (belief/mindset) + Opportunity (a good thing coming your way) + Action (doing something about it) = Luck.

For being aware of your choices, you have to Track every action that relates to the area of your life you want to improve.

• If you want to get out of your debt, you need to start tracking every penny you spend out of your pocket.
• If you want to lose some extra weight, you need to start tracking every single thing you put in your mouth.
• If you want to train for an athletic event, you need to track every step you take, every workout you do.

Simply carry a notepad and a writing instrument or just phone, and that's all. But do this without fail, no excuses, no exceptions. 

Think Big Bro is watching you.

This process forces you to be conscious of each of your decisions.

Jim Rohn says, “What’s simple to do is also simple not to do”.

Magic is not the complexity of the task, but it’s in doing the simple things repeatedly and long enough to ignite the miracle of the Compound Effect.

Keeping an expense log just for 2 months makes you aware of your habits. You create a completely new set of choices and disciplines around spending.

Since awareness and positive behaviors compound, you find yourself more proactive with money in general, you try to find areas like where to invest, save for retirement, and also find where it's a clear waste to spend money.

A horse wins by a nose but gets 10 times the prize money. Was he 10 times faster? Not at all. Those extra laps, extra efforts and a little better-disciplined nutrition his jockey provided him have made the results a bit better.

Or savings tree.

• Prepare your own food instead of spending money outside.
• Cancel some extra subscriptions.
• Spend every penny consciously (needs vs wants).
• Don’t buy anything on EMIs. Go for full payment.
• Follow the 50-30-20 Rule- Spend 50% of your monthly income on your needs, 30% on Hobbies and entertainment, and save or invest the last 20% for the future.

In his book Focal Point, Brian Tracy gave a simple success formula.

• Improve yourself or your earnings by 1/10 of 1% each work day. After a week, improvement goes to 1/2%, equalling 2% each month and 26% each year, and gets double in 2.9 years.

Why are we so irrationally enslaved by so many bad habits? Because our need for Immediate gratification can turn us into the most reactive, nonthinking animals around.

• If you took a bite of a Big Mac and immediately fell due to heart attack, you might not go back for second bite.
• If your next puff of cigarette turn your face into a 90 year old person’s face, chances are you’ll pass on the cigarette.
• If the first piece of cake instantly put 50 pounds, saying “no thanks” to dessert would be the true piece of cake.

The slightest adjustments to your daily routines can dramatically alter the results.

It's not so much, that you want to take out of your life, instead, add some beneficial options in advance. 

For example, Don't think (“I can’t eat a hamburger, chocolate, or dairy”). But Add your Healthy option so there is no place for the worse. (e.g., “Today I’m going to have a salad, steamed vegetables and fresh figs”).

Fill your focus and belly with what you can have, so you no longer have attention or hunger for what you can’t.

• Choose a hobby instead of binge-watching.
• Choose to play with your kids than be a couch potato.
• Choose your own ADD IN rather than the choices your inactivity gives you

Find a Peak Performance Partner (PPP), he/she can be your success buddy in your paths of different aspects of life. Give personal appreciation for their performance and get praise for your achievements too.