Compound Interest in Life (Not Just Money)
Small Daily Efforts, Massive Long-Term Rewards
When we hear the term "Compound Interest," we immediately think of finance, investments, and Roth IRAs. But the principle applies to almost everything in life.
We all intuitively understand:
The more you invest in a skill, the better you become
The more you invest in relationships, the stronger they grow
Yet the results of consistent action don't just add up; they compound with interest, leading to exponential growth.
The human brain is hardwired for linear growth, but struggles with exponential growth. We have difficulty visualizing how steep the curve gets as time goes on. This creates an illusion of immense distance between ourselves and those we consider successful.
Beyond Finance
When learning a new skill, you initially struggle to build a solid framework of knowledge. But as you stick with it, knowledge begins to compound. Eventually, even new concepts click faster because they fall into the latticework of everything you already know. Learning speed increases over time.
Consider your strongest relationships. They didn't grow linearly. Small, consistent actions—showing up, listening, being reliable—build deep trust over time. After years of consistency, that trust far outweighs its individual components. To think, "I'd trust that person with my life," you don't need to give them the opportunity to harm you first.
The Slow Start Before the Breakthrough
Why am I saying all this? Because in scenarios of non-linear growth, most things feel painfully slow at the start. But if you persist, growth becomes exponential. Stay the course long enough, and you eventually hit "escape velocity"—where progress becomes self-sustaining.
At first, it feels like nothing is happening. But with consistency, the curve bends upward, and suddenly, progress accelerates beyond expectations. A few pivotal moments can tip the scale dramatically.
The key is sticking around long enough to let them happen.
Real life is not linear, and we are often fooled by randomness. When progress seems slow, you're likely much closer to a breakthrough than you think. But it may not show up in the analytics.
When Doubt Creeps In
I have a friend who is a music producer. He and I remind each other of this concept all the time. It's become our mantra, a go-to response.
"My new creative project failed." Compound Interest.
"Should I keep doing this?" Compound Interest.
"I'm not seeing any results." Compound Interest.
"I just signed a track to a record label! Woohoo!" Compound Interest.
I admit it’s a bit stubborn, a cheeky phrase that explains both success AND failure. But I prefer to think of it as robust.
It can be difficult to recognize your progress, as you are the one going through the motions 24/7. You don't notice your hair growing every day, yet it does. I find it helpful to look at your work from 3, 6, or 12 months ago.
Think it's terrible? Good. That means you're making progress.
The moral: Start small. Stay consistent. Stick around long enough to get lucky.
Let me know in the comments what you're focusing on, and don't forget to share this with a friend who needs to hear it!
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I couldn't agree less. It's a revolutionary practical idea in one's life. Nice read 👍
Reminds me of James Clear’s aggregation of marginal gains. Thanks for sharing.