top of page

The Compounding Effect

Photo credit: Paola K

Doing small actions everyday have a compounding effect. This term is widely used in the financial sector to describe what happens to every dollar you put as investment at a certain interest rate which keeps being reinvested and accumulating earnings over every dollar invested over time. We can apply the same concept to the small actions we are investing everyday in the fulfillment of our goals. Derren Hardy, author of the book “ The Compound Effect” defines it as a strategy to reaping big rewards from small, seemingly insignificant actions performed consistently over a period of time.

Every day we are confronted with the choice of what to do with our 24-hours we have at our disposition. Most people do not go consciously choosing what to do at every moment in their waking time. Sadly, some people just pass through the day without ever noticing in which activities they are investing their precious time and where is it taking them to.

But what if you knew that those little, apparently insignificant things that you do everyday accumulate over time and end up being the result about who you are at the present moment? And who you will be in the future? What we call our past, is nothing more than the result of the accumulation of all the small choices we have been doing up to now.

Taking advantage of the compounding effect, we could plan our day in a way that every activity that we perform goes in relation to fulfil our goals and the kind of life we want for ourselves. Success is not a result of one single action, or a lucky event that happens randomly. Success is the result of a consistent set of actions performed over time in a way that keeps you moving forward.

Think about the endless hours of training that elite athletes invest everyday for years, to prepare for a single event, like the Olympic games or a world championship. Think about the mother who invest restless nights over several months in order to keep breastfeeding their babies as long as possible so they can grow healthy and strong. Every great effort and achievement comes from the seeds of action, consistency, perseverance and a unwavering focus on what is being done in the present.

Observing the nature can also give you great insights of the wonderful way the compound effect works. An Oak tree takes around 30-40 years to grow. At the time of planting the seed, several weeks and months can pass by without noticing any apparent movement on the soil. Suddenly, a small stem will eventually show out of the ground “out of the blue”. This small stem over time will convert itself into a full grown mature tree that can reach up to three meters high and can produce fruit and acorn for the next forty years. Oak trees can last as long as 300 years! Who would have thought, that such a tiny seed planted in the soil, will convert itself from a tiny oval into a majestic Oak tree?

Nature is a majestic teacher full of wisdom. Observe the works of nature and you will get very valuable insights about how life works. If you have a goal, but feel lost and do not know to start, do it like nature, start small. Start doing small and humble actions that bring order into your life and give you a sense of accomplishment. Get up early, do your bed, maintain order in your living space. Write down your dreams, fantasize and write down how to get there. Then decide what will you do today to reach them. It can be a small thing like writing an email, get subscribed into a course, call a friend, go out and do some sport.; read some books and invest in getting yourself as much educated as possible.

Do all those small things repeatedly and consistently and after 15 years you will be unbeatable!

4 views0 comments

Recent Posts

See All


bottom of page