Compounding is the most powerful force in the universe and one we all can use to our advantage. Of course, you have to understand it to achieve the best results.
It’s been about a year and a half since my last article on the power of compounding. Since then, I have gone on to appreciate its value to the universe even more intimately.
Read from the source. First and foremost, the holy grail of compounding is the book “The Compound Effect.” Everyone should read this book immediately.
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Inside the book, we learn that everything we do compounds in the universe—good and evil.
If you form great habits, you’ll get great results. Conversely, if you build negative patterns, you compound these adverse effects.
Therefore, we have to be intentional with everything we perform. If we want to build a habit, we need to do it for 30-90 days.
My life and compounding. I want to give my real-life experience with compounding because it’s vital to help others understand the concept.
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Here are some areas of my life that have benefited from compounding by taking intentional steps to reform, refit, and rebuild.
- Drinking alcohol
- Physical fitness
- Knowledge & Education
- Dividend Investing
- Writing
- Creating Book Covers
- Book Sales & Website
Drinking Alcohol. I used to be a massive drinker. When I was younger, it was frowned upon if you didn’t drink. However, drinking is not suitable for my blood pressure.
I had to take extraordinary steps to overcome my habit because drinking was the thing to do every night. I used a spreadsheet to track my drinking over 3-6 months.
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Finally, once I committed to writing and reading every day, there was no room in my life for over-drinking. I still have an occasional beer, but it’s far and few between; there is too much work I need to accomplish.
Physical fitness. I made it a point to exercise every day since 2013. I have kept that promise to myself since then.
The most important part of staying fit is turning yourself into your own coach. No matter where you are, you need to find a way to exercise.
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I exercised daily on my seven-day passive income road trip from Pensacola, Florida, to San Diego, California. I even picked hotels that had gyms.
Physical fitness is a tough habit to build, but if you can do it, you’ll be good for the rest of your life.
Knowledge & Education. Robert Kiyosaki said in “Unfair Advantage” that education compounds. The more you read, the more the connections in your brain interact and grow.
My son told me he doesn’t read much because he can’t remember everything. I replied that your mind retains, but it may not seem that way. The more you read, the more you comprehend everything.
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That’s why your vocabulary grows when you read continually. You are naturally picking up words along the way, even though you may not realize it is happening.
After 125 books, my mind seeks more and more knowledge. I love the idea of building a mega computer in my brain just from reading.
Dividend Investing. Most people talk about the power of compounding as it relates to investing. Yes, it’s true; you’ll see massive gains in your investments over time.
Sometimes, you cannot even fathom how your accounts are doing so well. In August 2019, I earned $0.88 in dividend income. Three years later, in August 2022, I will make over $1,000. That is a gain of over 1,000%.
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Writing. I love writing, and it is something I do most every day. I haven’t missed a day (outside of airplane travel) in 1.5 years.
I don’t think I have become a better writer because of compounding. However, I know I can write much more effortlessly and achieve a flow state more quickly. I never have to sit and think about what to write next.
The ability to write comes from reading and consuming as much content as possible. I can convert news into actionable articles to write next. I have become my own content-producing machine.
Creating book covers. Designing book covers has been my creative outlet for two years now. It is so fun to go into a book cover without an idea of how I will complete it.
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Many times, I look back on my books and don’t even know how I created something like it. I have emotional responses to many of my book covers (hopefully, you do as well).
I started a YouTube channel so you can follow along my journey to create book covers. It is fun to replay some of these moments because a lot of the creative process is random.
Book Sales. Finally, my book sales and website numbers are compounding rapidly. If you didn’t know, selling books on Amazon and driving traffic to a website is tough.
However, you only need to do the hard work once. As your sales and website grow, you’ll appreciate that they will keep growing over time. You only have to be in the dark once.
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My sales are starting to see the light, and every month this year, has performed very well on a year-over-year basis. My website is doing even better on a year-over-year performance metric.
If you become a content creator, you must understand how the power of compounding snowballs into bigger results slowly (at first).
Conclusion. A quick bonus topic is paying off debt. As your knowledge compounds, so does your focus. You’ll hate wasting even a penny if it’s not going to pay down debt.
My wife and I paid down our debt in roughly two years. The power of compounding will grab hold of anything you deem necessary.
It is your job to tell the world the result you’d like to achieve. You will compound your way to success as soon as you make a focused, organized effort to reach a goal.
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The book “Think & Grow Rich” is so powerful because of compounding our affirmations. You write a goal, say reach $1 million in a dividend portfolio; then you compound toward achieving this goal.
Your thoughts will compound, then your actions, and then your results. Sometimes it is hard to predict how you will achieve the results because they seem unfathomable. However, you’ll start to see nuggets of new ideas to obtain your goal.
The brain is an incredible force in the world; however, limiting beliefs keeps it from growing into its potential. Once you comprehend the power of compounding, you are allowing your brain to do what it does best—compound. Good Luck!
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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. All Right Reserved Military Family Investing
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