“Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t, pays it.” -Albert Einstein
The book talks about the law of “Compounding Effect” and it’s the principle of reaping huge rewards from a series of small and smart choices. It means that small consistent action over a long period of time has greater payoffs than intensely large but short changes.
Everyone in this life has his own definition of success it could be money, fame, being happy, well-shaped… etc. But what we don’t get is that success is not about the information we have, it’s about a new plan of action It’s about creating new behaviors and habits that are oriented away from sabotage and toward success.
The Magic Penny
Let’s say you were offered $3 million in cash at this moment or a single penny that doubles in value every day for 31 days. Which would you choose?
obviously, if you weren’t aware of the compounding effect you will choose the first deal. Now let’s imagine that each of you and your friend got this offer, and your friend choose the 3 million dollars but you picked the penny route, on the day ten and while your friend enjoys spending his big check you only receive $5.12
After 20 days you have $5,234 you didn’t even reach $10K and your friend got $3 million dollars in one day, here, you start saying yourself: ” is that a really good decision?? “, only 11 days left, now the magic start works in the day 31 you ended up with $10,737,418.24 more than three times your friend’s $3 million, mind-blowing right !! that’s exactly how the compounding effect works, consistency over time is so important maybe you can’t see the immediate results in the beginning but in the long run, it’s so obvious.
If you wanna live the life you want, you must believe that luck has nothing to do with it. The difference between becoming rich, happy, and healthy, or broke, depressed, and unhealthy, it’s up to you and the choices you make every day.
When the author asked Richard Branson if he felt luck played a part in his success, he answered, “Yes, of course, we are all lucky. If you live in a free society, you are lucky. Luck surrounds us every day; we are constantly having lucky things happen to us, whether you recognize it or not. I have not been any more lucky or unlucky than anyone else. The difference is when luck came my way, I took advantage of it.”
Darren Hardy talked in this book about the formula of getting lucky which is :
Preparation (personal growth) + Attitude (belief/mindset) + Opportunity (a good thing coming your way) + Action (doing something about it) = Luck
-Preparation: By consistently improving and preparing yourself, skills, knowledge, relationships, and resources, you will be ready to take advantage of great opportunities when they arise.
-Attitude: It’s seeing situations, conversations, and circumstances as fortuitous. You cannot see what you don’t look for, and you cannot look for what you don’t believe in.
-Opportunity: “It’s possible to make your own luck, but the luck I’m talking about here isn’t planned for, or it comes faster or differently than expected. In this stage of the formula, luck isn’t forced. It’s a natural occurrence, and it often shows up seemingly of its own accord” – Darren Hardy
-Action: here when we separate “the lucky and the unlucky one” as Richard Branson thinks, we are surrounded by a lot of opportunities and when you see one your job is to act up otherwise you’re going nowhere.
Understanding the Compound Effect will rid you of “instant-results” expectation—the belief success should be as fast as your fast food, your one-hour glasses, your thirty-minute photo processing, your overnight mail, your microwave eggs, your instant hot water, and text messaging.
“Enough, okay? 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 each 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! ” -Darren Hardy
Understanding how the Compound Effect works put you in a position where you Don’t try to fool yourself into believing that mega-successful people didn’t live through regular bone-crushing drills and thousands of hours of hard-working. they got up early to work—and they kept working long after all others had stopped. they faced the sheer agony and frustration of the failure, loneliness, hard work, and disappointment it took to become what they are today. By the end of this book, or even before, you need to know in your bones that your only path to success is through a continuum of mundane, unsexy, unexciting, and sometimes difficult daily disciplines compounded over time.
The Compound Effect is always working. You can choose to make it work for you, or you can ignore it and experience the negative effects of this powerful principle. It doesn’t matter where you are on this graph. Starting today, you can decide to make simple, positive changes and allow the Compound Effect to take you where you want to go.
Power of consistency
if there’s a discipline that gives you a competitive advantage, it’s your ability to be consistent. Whatever you wanna reach in your life depends on your level of consistency, literally, Even good, passionate, and ambitious people with good intentions can fall short when it comes to consistency. But it’s a powerful tool you can use to launch the flight toward your goals.
and the “pump well” example used by the author made it very clear:
Think of hand-pumped water well, which uses a pipe to draw water up from the water table several feet underground. To get the water to the surface, you have to pump the well’s lever to create the suction that brings the water above the ground and out of the spout
When most people start a new endeavor, they grab the lever and start pumping really hard. they pump and pump and pump but after a few minutes (or a few weeks), when they don’t see any water (results), they give up pumping the lever altogether. They don’t realize how long it takes to create the vacuum needed to suck the water into the pipe and eventually out of the spout and into their bucket. it takes time, massive energy, and consistency to pump water.
Most people give up, but wise people continue to pump. Those who persevere and continue to pump the lever will eventually get a few drops of water. This is when a lot of people say, “You’ve got to be kidding me! All this pumping, and for what—a few measly drops? Forget it!” Many people throw their hands up in defeat and quit, but wise people persist further.
And here’s where the magic happens: If you continue to pump, it doesn’t take long before you’ll get a full and steady stream of water. You have your success! Now that the water is flowing, you no longer need to pump the lever as hard or as quickly. It becomes easy, actually. All you have to do to keep the pressure steady is to just pump the lever consistently. That’s the Compound Effect.
Making the right choice, holding to the right behaviors, practicing perfect habits, keeping your momentum, and most important staying consistent is easier said than done, but once it’s done it’s gonna make a massive change to your life
Do the unexpected
What’s popular is average, it’s what’s common. Common things deliver common results. The most popular restaurant is McDonald’s, the most popular drink is Coca-Cola, Consume those “popular” things, and you’ll be part of the common, average pack. But that’s ordinary. There’s nothing wrong with ordinary. but when you have the successful mentality you will never settle for ordinary especially after you read The 10X Rules by Grant Cardone
In our attention-deficit, propaganda-saturated society, sometimes doing the unexpected is required to get your voice heard. If you have a cause or ideal worthy of attention, do what it takes, even the unexpected, to make your case heard. Add a little audacity to your repertoire
” You are ready to make dramatic improvements, right? Of course, the obvious answer is, “YES!” But you know by now that saying you’re ready to make the necessary changes and actually making them isn’t the same thing. To get different results, you’re going to have to do things differently. ” -Darren Hardy
In the end, I want you to know that reading the summary is helpful (at least better than not reading at all). But, you will not get the full benefit unless you read the whole book. Remember: “reading a summary of a certain book is like watching a trailer of a movie while reading the whole book is like watching the whole movie.”
Buy The Compound Effect by Darren Hardy :
My name is Muhammad Islem I’m a college student, I have 3 years since I started learning about digital marketing, I like talking about businesses, marketing, books, and ways of making money.
I’ve created this blog to talk about things that interested me and to help young entrepreneurs start their own businesses and escape their boring 9 to 5 jobs.