PDF Summary:The Compound Effect, by Darren Hardy
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1-Page PDF Summary of The Compound Effect
The Compound Effect by Darren Hardy offers simple tips on achieving success and living the life of your dreams. The idea is similar to compound interest in finance - small, everyday decisions add up to huge returns over time.
While the concept is simple, that doesn't mean it's easy. Hardy presents six strategies for successfully and carefully directing your choices to shape your destiny in a positive direction and offers a plan of action for improving your results.
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- Take advantage of luck. The kind of luck we associate with success is a combination of preparation, a good attitude, finding an opportunity, and taking action.
- Tracking. When you track your behavior, you can take control of the choices you make throughout the day; your habits begin working for you, with positive results.
When it comes to the Compound Effect, the sooner you make small, positive changes, the better. But don’t use the excuse that it’s too late to start; it’s never too late to use the power of the Compound Effect. Starting now is the key, no matter how old you are.
Chapter 3: Habits and Goals
Habits are acquired behaviors that have become nearly involuntary. At their worst, habits can run you in the wrong direction without you even realizing what’s happening. Good habits, however, take you in a positive direction. The goal is to gain awareness and change the habits that are holding us back. We can prepare ourselves to do this by:
- Resisting the lure of instant gratification. Often, instant gratification obliterates any concern in your conscious mind for long-term results. The first step is to wake up and realize the true ramifications of the bad habits we indulge in.
- Finding your “why.” You've got to figure out what you want and why you want it or you’ll give up too easily.
- Defining and calibrating your “core values.” When you have clearly defined core values, making decisions is easier because you can simply ask yourself which choice aligns with those values. If something doesn’t align, you can forget about it.
- Finding out who and what you’re fighting. We all have the ability to take hurtful experiences from our past and use them to fuel constructive change.
- Setting and achieving goals. When you clearly define your goals, you experience the world differently, attracting the opportunities you need to achieve that goal.
- Become the person you want to be. Strive to gain the attributes you need to achieve your goal. Without these, you can do all the right things but still never succeed.
There are five strategies to help get rid of bad habits:
- Know your triggers. What situations trigger bad habits? (Do you drink too much with a certain group of friends? Do you crave chocolate at a certain time of day?)
- Get rid of it. Throw out the objects enabling your bad habits.
- Find replacements. Find something healthy that can replace the bad habit.
- Take it easy. You don’t have to go cold turkey. Since they are so entrenched, you may need to take small steps toward unwinding your bad habits.
- Or don’t take it easy. While it’s probably the exception and not the rule, some people actually do better changing a lot of bad habits at once.
There are six strategies to help craft new, positive habits:
- Help yourself succeed. Make your new habit easier to instill by setting yourself up for success. (If you want to eat healthier, keep healthy snacks available.)
- Focus on what you can have or do. Instead of feeling deprived, focus on the new things you are bringing into your life.
- Accountability is key. Becoming accountable is a sure way to cement a new habit.
- Find a partner. A partner in your endeavor, whether it’s losing weight, exercising, or improving your career, boosts your accountability and lends support.
- Friendly competition. Competition can help you immerse yourself in a new habit.
- Enjoy. Instilling new habits doesn’t have to be drudgery. Find rewards along the way to keep you motivated and help you celebrate your success.
Chapter 4: Finding Momentum
Momentum (Hardy calls it “Big Mo”) is a powerful force for success. Momentum doesn’t come easily, but once it kicks in, your ability to achieve success compounds quickly.
Momentum can work for good or bad. Momentum kicks in to help you when you:
- Make good choices that help you reach your goals and that align with your values.
- Engage in positive behaviors based on those good choices.
- Make those positive behaviors into habits of behavior and routine.
- Remain consistent with your new positive habits and routines.
Why Routines and Rhythms Are Important to Momentum
When you have set a goal and created good new habits to support that goal, you must have daily, weekly, and monthly routines in place to reinforce your positive new direction. The greater your challenge, the more stringent your routine should be. Mornings and evenings are great times to implement healthy, positive routines.
When you make your habits a routine, you can get into a rhythm—your routine feels easy and natural. Once you’re in a rhythm, momentum gets a chance to work its magic.
Consistency Is Critical to Success
When you want to change your life for the better, doing too much too soon can set you up for failure. Instead, set up a rhythm for success that you can stick to because this is about improving the rest of your life. Aiming for improvements you can make consistently is critical for success. A lack of consistency is a momentum-killer.
Chapter 5: Understand What’s Influencing You
Our choices are influenced by three main types of powerful outside factors:
- Mind input. Whatever you allow into your brain is influencing your thoughts. You are the gatekeeper of your mind, and you must be vigilant about protecting it from worrisome and destructive input—and be very particular about what you allow in.
- Associations. Our friends influence us subtly yet powerfully, and that influence can be negative or positive. If you want to possess certain traits, the best way to start is by hanging out with people who already possess those traits.
- Environment. Your goals and ambitions may be bigger than your current surroundings, and sometimes it takes getting out of your current environment to see your dreams fulfilled. Keep your physical and mental environment clutter-free.
Chapter 6: Breaking Through to Greater Success
Because of the Compound Effect, your small actions, habits, decisions, and behaviors, compounded over time, can lead to powerful improvements in your life. But adding just a smidge more effort can speed up and greatly improve your results.
True growth occurs because of what you do after you’ve hit a wall; pushing through that wall, even when you think you can’t go any further in your endeavor, can multiply your results.
To motivate yourself to do just a little bit more than expected, think of yourself as your own toughest competitor when you hit a wall and fight to go above and beyond your limits. Another great way to multiply your results is to focus on rising above what other people expect of you, surprising them with what you’re truly capable of.
Doing the unexpected and adding extra effort separates you from the pack, makes a bold statement, and multiplies the impact of your efforts. In all areas of your life, find the opportunity to multiply your results—prepare better, push harder, last longer and put more of your time, energy and thoughts into your endeavors.
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PDF Summary Introduction
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We all know what it takes to succeed; the tricky part is creating a plan of action. There’s no quick fix to changing your life. Success will require hard work, discipline and commitment.
Each chapter in this book explores a fundamental tenet of the Compound Effect that will help you generate new behaviors and habits to propel you toward success.
PDF Summary Chapter 1: Putting the Compound Effect Into Action
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If you took the $3 million and your friend took the penny, by day five you’d have your $3 million and your friend would have 16 cents. By day 10, your friend would have $5.12. After 20 days, the friend would have only $5,243 in comparison to your millions. But then the magic of the Compound Effect happens: by day 31, your friend would have $10,737,418.24.
The principle of consistency over time rewards your friend with three times as much money—but in the beginning, the right choice was so hard to see.
Example 2: Three Friends
Three friends, Larry, Scott, and Brad, live very similar lives as far as income, marriage, health and body weight (they all have a little flab). Larry says he’s happy and goes about his life not making any changes—but he does complain that “nothing ever changes.”
Scott decides to make small, positive changes. He reads every day and listens to something inspirational during his work commute. He decides to cut 125 calories a day from his diet, and finds it easy to do. He starts walking 2,000 steps more per day, and this change is easily incorporated into his life. He sticks with these simple choices.
Brad decides he wants a little more fun in his...
PDF Summary Chapter 2: You Make Your Choices, and Your Choices Make You
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Gratitude Creates Good Choices
One such small negative choice is focusing on the negative qualities of other people or situations. It’s a bad habit that leads to a cycle of negativity—compounded negativity.
Focusing on what you are thankful for, however, creates a compound effect of positivity.
To illustrate this, Hardy shares the story of a friend whose marriage was on the verge of collapse. This man complained about his wife constantly and saw her as the source of his unhappiness. Hardy shared with his friend an experience that strengthened his own marriage.
One Thanksgiving, Hardy decided to keep a yearlong journal of gratitude about his wife to present to her the following Thanksgiving. Every day that year, he wrote down something about his wife he appreciated, whether it was a meal, something she said, how she related with her friends or cared for her dogs, how she looked, and more.
While his wife was elated about the gift, Hardy was the one most affected by this experience. He had spent a year focusing on the positive, often subtle, qualities of his wife and gained a greater appreciation for her. His gratitude and positive feelings changed his behavior...
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Learn more about our summaries →PDF Summary Chapter 3: Habits and Goals
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- Resisting the lure of instant gratification
- Finding your “why”—your motivation for change
- Defining and calibrating your “core values”
- Finding out who and what you’re fighting
- Setting and achieving goals
- Becoming the person you want to be
Resist the Lure of Instant Gratification
We all know the “right” things to do to live a healthy life. We know we shouldn’t have Pop-Tarts for dinner or watch reality TV for 3 hours a night. So why do we allow these bad habits to continue? The problem is our need for instant gratification.
Often, the payoff you receive from instant gratification obliterates any concern in your conscious mind for long-term ramifications. For example, if eating a piece of cake instantly put 50 pounds on you, you’d put the fork down. If making one less sales call at work got you immediately fired, you’d pick up that phone. But since the consequences of these small actions can take years to show up, courtesy of the Compound Effect, it’s easy to choose instant gratification over the correct behavior.
**The first step is to wake up and realize the true ramifications of the bad habits we indulge in and know that even the...
PDF Summary Chapter 4: Finding Momentum
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Momentum at Work Example 2: Apple
Apple Computer has been around a long time. Its Macs were always popular, but they had only a fraction of the market segment PCs had. When the company introduced the iPod in 2001, the device wasn’t the first MP3 player around. But Apple had consistency in its courting of customer loyalty and was consistently innovative with design, ease of use, advertising, and the “cool factor.” The iPod was a hit, but the company’s path toward positive revenue growth took a few years. They caught momentum in 2005 and gained 68 percent revenue growth.
Today, Apple dominates the smartphone market with its iPhone and has exploded into other areas such as digital music.
Why Routines Are Important to Momentum
When you have set a goal and created good new habits to support that goal, you must have daily, weekly, and monthly routines in place to reinforce your positive new direction. The greater your challenge, the more stringent your routine should be.
Think of new military recruits heading to boot camp. As soldiers, these recruits will have to be able to carry out their duties efficiently and reliably even under intense...
PDF Summary Chapter 5: Understand What’s Influencing You
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Guard Against Negative Input
You can’t lock yourself in a bubble; negative info bombards you on billboards and at work, and friends, family, and even your own thought process can let negativity seep in.
While you can’t control everything, you can limit your exposure to “dirty water.” For example, you can’t avoid the tabloids at the supermarket register, but you can cancel your subscription. At home, you can turn off the news and instead record inspirational and educational programs that benefit the whole family—and skip the commercials. You can turn off the radio on your morning commute and listen to a book on tape or something uplifting.
Another way to limit your exposure to negative input is to go on a “media diet.” The media is savvy; it knows that sensationalism appeals to our basic nature as humans. This would be easy to tolerate if there were only a few media sources. Today, however, the news is everywhere and runs 24/7. As media outlets compete for our attention, they try to outdo each other with shock value. The result for us is a warped, dismal view of the world. The millions of good things that happen each day don’t make it into our minds. This is crippling to...
PDF Summary Chapter 6: Breaking Through to Greater Success
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Another example is running. If you set a goal for your run, but go a little longer after you’ve hit your wall, you’ve extended your personal limits; the results of that single run are multiplied.
Remember the magic penny that doubled in value every day for 31 days? What if it doubled just one extra time per week? You’d have $171 million instead of $10 million!
To motivate yourself to do just a little bit more than expected, think of yourself as your own toughest competitor when you hit a wall and fight to go above and beyond your limits.
Blow Away Other People’s Expectations
Another great way to multiply your results is to focus on rising above what other people expect of you, surprising them with what you’re truly capable of.
You can do more than people expect of you in every aspect of your life. Oprah is a great example of this. When she launched her 19th season in 2004, she called 11 people to the stage and gifted them with a car. Then she gave the rest of the audience boxes, saying one of them held the key to a 12th giveaway car. But when the audience members opened their boxes, everyone had a key. “Everybody gets a car!” she screamed. In that moment, she fully...
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