The Power of Compounding

The Power of Compounding

What happens today is the result of thousands of small actions and choices that have been made in your lifetime.

In our talk with Rachel today you heard about the impact of small changes, persistent changes, over time.

In our off-camera, off-microphone conversations I asked her why, if all this nutrition stuff is so obvious and available, why so many people are stuck?  And what she said is that her most successful clients have an immediate reason to change.

And most people are unable to makes small changes to their lifestyles and habits that would put them on a path to achieve their health goals in the future.

People who know they should eat better or are otherwise mildly unhappy with their current state aren’t successful.  That knowledge isn’t enough.  That mild discomfort isn’t enough.  They need to have an immediate need.  An acute need.

Or they needs to intellectually understand the impact of small changes and the compounding effect of those small changes over time.

Because there is no direct connection between the action and the impact.  Humans have a hard time with that.

You can eat that next donut or pizza and nothing really bad is going to happen.  You’re not going to fall down, clutching your chest and die.  Just the opposite.  You are going to have a sense of momentary euphoria from eating your favorite food.

But over the course of a week, a month, a year, a decade that small choice IS going to lead to you clutching your chest on the ground.

Because we can’t connect the small joy of today with the gruesome and shocking results of the future – we don’t have enough pain to act on it.

The opposite is true as well.  There is a direct causality between your ability to make short term positive decisions and your long term success in all aspects of your life.

(For the psychiatric science behind this google “the Marshmallow Test”)

For us meat puppets unfortunately there is a big gap between intellectually knowing and taking that small action.

And that’s everything in life.  Your current state is the accumulation of all those small choices that you have ever made.

How do you make the small choice today that adds up to the place you want to be in five years?  It’s hard.  Those small choices may not be pleasurable at the moment.

When you choose to go for a run on a rainy day.

When you choose to not eat that donut, not drink that beer, you are trading small immediate pleasure for a greater pleasure in the future.  But, it’s an intellectual choice that is incredibly hard.  That future is unknown, and squishy.

The now is here and solid and real.

You need to use all your understanding of the power of habit to rewire those small pleasures.

But it’s more than just a linear or binary choice – that small action directed towards the better/healthier future today.  It is part of an investment of energy, knowledge and time that compounds over time with consistency.

Trues compounding is nonlinear.  Because the improvements or the advancements of each iteration of the small thing build upon the level of the previous thing.  1% better is compounded.  The end results of consistency are greater than inconsistent hard or big efforts.

That’s how compounding works.

Here I will refer you to the grain of rice fable.  Or the penny a day story.

And I will apologize for plagiarism every self-help financial coach in the history of mankind.  Because, of course this concept was built for coaching people on the importance of retirement saving.

If I asked you, would you rather have $1m today or a penny a day for 30 days which would you choose?  What if I doubled the penny every day?  So, 1 penny on day 1, 2 pennies on Day 2, 4 pennies on day 3, etc?

And the punchline is that the penny a day choice gets you over $5m at the end of 30 days.

Because it compounds.

But it can only compound if you are consistent.  If you were to skip a couple days or buy some gumballs with the money during the month the amount at the end would be much less.

Coaches speak of the power of consistency.  What they mean is just showing up and doing the work every day will get you to your goal at the end of the training cycle.

And no good coach tells you that you just need to work harder.  Consistency beats heroic efforts.  The next time some idiot tells you to ‘give 100%’ or even better to ‘give more than 100%’, instead of attempting to explain basic mathematical principles to them, just smile and keep being consistent.

OK – we all agree it’s hard to make small, good choices in the present.  We all agree the benefits of doing so compound.  We all agree that consistency is the key.

How do we bridge the gap?

I’m no expert but I’ll give you some ideas.

Depending on your personality type you need to find a way to enjoy the process.  For some of you that might be creating a competition.  For others, like me, a process of habits.  For other you might tie it to your faith or your family.

Whatever motivates you and can trick the maniacal hamster that lives in your brain into doing the right thing consistently.

Intellectually understanding the future and living in the now.  Be present in these short term decisions.  They are habits and habits are unconscious.  Be present in them.

Have the patience to be consistent.  Long term goals and lifestyle changes do not have a ‘right now’ cause and effect.  You need to have patience and make a long term commitment to stick to the process.  The process is today.  Trust the process.

I help this along by setting shorter term goals that dovetail into long-term results.

Take a stand for yourself.  When your partner calls in evening and says ‘there’s nothing for dinner, I’ll just bring home pizza and beer’, You have to stand up for yourself.  “Do what you want, but I can’t eat that.”

Eventually you will start creating a lifestyle consistent with these small, healthy habits.  Through consistency they will go from chores to part of who you are.  The consistency will become your identity.