Have you ever wondered why some people always seem to be lucky? What if I told you that a series of decisions were made to get that ultimate result. “The Compound Effect”, by Darren Hardy, takes a hard look at the day to day decisions we make that will ultimately lead to success or failure. The premise of the book is that every day we make decisions that will build up to something amazing as a result. The counterpoint is that every day we can make poor decisions that stack upon one another, and they will lead to our failure. Take starting a blog as an example. Every time you produce an article, you put your words into the universe. The universe (and the internet) already has tons of words floating inside of it. There is little chance someone is going to stumble onto your words. But as you keep writing and contributing, there is a higher chance that your words are read by someone. It may take 6 months or it takes 2 years, but eventually, someone will find your words. And when they finally find ALL of your words, they will share the complete package with someone else. There will be a chain reaction of people reading all of your words. It will be more than just the one article, but years of writing. Someone from the outside will look at you and say “man, you got lucky”. But you know all the hard work you put into getting all your articles done. No one was there, in the beginning, to pat you on the back and congratulate you. It is just you and your words.
That is the difference between those who succeed and those who fail. The successful person keeps going past the pain and agony. It is a lonely world when you are starting out. You don’t have a crowd cheering for you from the start. There aren’t endorsement deals to entertain. No one wants to buy your book, listen to your podcast, watch your YouTube video, or read your blog. “The Compound Effect” is a motivational book that commands you to keep pushing. It says that whatever you put into the universe will come back to you. Your consistent hard work will pay off, it just takes an amount of time that no one can predict. You have to trust your higher being and the universe to sort everything out. This book also looks into your habits and asks if you are compounding good habits in your daily health, fitness, self-education, and relationships. With that, let’s jump into my 5 takeaways.
1) There is no shortcut to success. We have been taught that we can be anything we want. And yes, I agree, this is true. But this will not come easy for most of us. Even gifted basketball players have to spend tons of time shooting free throws or dribbling, in order to round out their game. If we understand the compound effect, we will understand that any amount of time put into something, will lead to that something multiplying. The caveat is that it can be a good something or a bad something that is multiplying. Be very aware of your habits. Ensure that they will multiply into something productive and rewarding.
2) “The Compound Effect is the principle of reaping huge rewards from a series of small, smart choices.” This is what we are not taught about success. I have been able to understand building passive income very easily. I am able to study for hours on end, take notes, and comprehend what I have read. I realize now that this is because I was a great student in middle school and high school. I learned how to study and prepare for tests. This is the ultimate payback because now I am reaping the rewards of all those years of studying and learning how to learn. My brain was using the compounding effect to build up a habit of successful studying. Now I can reap the benefits from that.
3) Once we experience a period of prosperity, health, and wealth, there is a chance that we become complacent. We can use the compound effect to build successful habits, but it can also work against us when we stop building. For my blog example, let’s say I wrote an article a day for a year. Then my blog became extremely successful. I started dialing in the writing or calling in a ghostwriter. These things would compound against me and lead to the slow death of my blog. This doesn’t mean that I am stuck writing a blog every day for the rest of my life. I can introduce a partner who can split days with me, for example. But I cannot just try to hide the fact that I am not doing what everyone expects of me.
4) Take credit for your actions and inactions. This sounds super simple, but it is one of the most important parts of our lives. If we can accept that we are where we are in life because of our own actions, then life becomes easy. We cannot blame the president, the government, corporations, or our families. It is us. We have to use our time wisely. If we want better relationships, then it is our job to create them. If we want more wealth, then it is our job to learn how to build it. Life is much easier when we are in control.
5) A daily routine built on good habits separates successful people from the rest of the population. I believe that this is why the military is so successful at creating good members of society. They dictate what people’s habits will be. This includes fitness, health, education, and training. I wish that it includes relationships as well. I am starting to take a deep dive into my daily routine and ensure that it is compounding things that I want to compound. It is good to evaluate where you stand in the universe from time to time.
The book had a different take on my favorite quote. My favorite quote is “The main difference between the rich and the poor is how they spend their free time.” The book’s quote is “The biggest difference between successful people and unsuccessful people is that successful people are willing to do what unsuccessful people are not.” I whole-heartedly agree with this. I always laugh to myself when my wife and I tell people that we rent out rooms in our house. They give a look of disgust. That doesn’t bother us because our kids each already have a house and a brokerage account. They have money compounding in real estate and the stock market before they even graduate high school. My wife and I live a life free from day to day worrying about money issues. We are using our room rentals to compound our future lives and our kids’ lives as well. And we are just getting started. I recommend reading this book if you strive to be your best self. If you are on the fence about starting a blog, business, YouTube channel, etc. This is the book for you. When you start, chances are that you will not be as good as you think. That’s part of life. You can use the compounding effect to increase your skills, motivation, and likelihood of success.
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
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