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The Compounding Interest of Good Habits

Compound interest is the 8th wonder of the world. He who understands it, earns it; he who doesn’t, pays it.

Albert Einstein

Did you know that at an annual return of 9% it only takes 8 years to double an investment? This is due to the magic of compounding interest.

Warren Buffet famously referred to the above Einstein quote when he called compounding interest one of the most powerful forces in the universe.

But this powerhouse concept is not limited to your portfolio. Think about how it applies (perfectly) to habits.

The value of compounding interesting comes in small, incremental increases over time. This requires consistency. What it does not require is heroic feats of willpower.

In fact, in the spirit of consistency it’s better to start your habits uncomfortably small.

To start with doing 20 pushups/day for the first couple weeks instead of trying to bang out 100 (and most likely bailing after 3 days) because it’s what your friend told you he does.

20 pushups/day with a modest weekly increase (an extra 1 per week, let’s say) can create a staggeringly large volume of pushups over a year’s time. Far more than if you gritted out the aforementioned 100 a few times over the course of that same year.

This applies to almost every habit. Writing, meditation, fitness, diet, intimacy etc.

If done with consistency (no matter how small the effort), the results add up spectacularly over time.

I found this with writing over the past year. For my entire life, I would go 4 months without writing and then, in a fit of inspiration, bang out 2 hours one caffeinated morning…and then another 4 months would pass. Very little writing was accumulated and very little writing skill was developed.

But in the past year, after reading Steven Pressfield’s The War of Art, I decided that I was going to write with consistency no matter what. No matter how small.

And so I did.

Some days it ended up being 2 hours of writing. But more often than not it was less than 15 minutes. And that was ok. But the important thing was that on most days, I wrote.

And in that year I accumulated more writing than I had in the previous 31 years of my life. It wasn’t even close.

Plus writing doesn’t feel like a big deal now. It’s just something I merely do. It doesn’t intimidate me like it used to (most days at least). It’s just part of my day.

I attribute all of this to compounding interest of this good habit.

With consistency (which was mainly made possible through accountability partners) and a commitment to being ok with modest daily efforts the results over time, at least compared to my previous results, have been staggering.

8th Wonder of the World indeed.

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