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We live in an instant society where seemingly no one likes to wait for anything. Years ago when I worked as a retail clerk for a well-known national supermarket, the store had no deli section and “instant meals” were either Maruchan ramen or the “TV dinners” in the frozen food aisle.

Fast forward to today, and the fastest growing segment in grocery stores are the deli and ready-to-serve meals section. Clearly, we are becoming a society averse to the idea of waiting for food or even taking the time to prepare it. 

This “instant” mindset is so pervasive that it permeates every aspect of our lives. Why wait week after week when, for a fee, we can set up a subscription with a media provider and binge-watch a favorite show over a weekend without any commercials?

Why save or put things on layaway when we can use a credit card for instant gratification? Why even leave the house and go shopping when you can go online, order something and, increasingly, have it delivered later that same day? 

Paul Roberts, in his book The Impulse Society, provides a galvanizing, sweeping social critique of our current propensity to live an instant lifestyle. He looks at economics, psychology, political philosophy and business management to show how we’ve reached “a virtual merging of the market and the self.”

Heady stuff. But, as you look around, so true. 

The problem with an instant lifestyle is that you live in a reactionary mode, not with any kind of purposeful direction. Instead of making reasoned decisions rooted in logic and long-term goals, you make decisions based on emotional impulses, driven by the need for immediate gratification. 

Compounding interest is about more than money

Most of us are familiar with the idea of compounding interest. Put a small amount of money in the bank and leave it for a long period of time and, once you begin earning interest on your interest, the results become amazing over time.

A mere $100 a month, invested in something such as the S&P 500, can, over a lifetime, grow to over half a million dollars. On the flipside, however, to use credit to buy things and then only pay the minimum means that compounding works against you as your interest charges compound negatively against you and can, if left unchecked, lead to financial ruin.

At a minimum, it can mean that instead of facing your retirement with adequate funds to live a comfortable, meaningful life, you could end up with a dependence on Social Security along with its correspondingly diminutive lifestyle. 

Put another way, Ben Kinney, PLACE co-founder, explains, “Interest earned is the reward for making wise decisions through patience and discipline, while interest paid is the penalty for impatience and overspending.” Those who are willing to be proactive and patiently invest will see long-term dividends, while those who need to have immediate gratification will end up with long-term debt. 

Compounding habits can also provide long-term ROI

While we all understand how this works in the financial arena, less familiar is the idea of compounding habits and the long-term effects produced by good habits versus the poor results obtained by negative behaviors. Put simply, a small action repeated day after day will have a measurable effect on your future. Whether that effect is good or bad depends on the action. 

As an example of behavioral interest earned, many of us, over our lives, have chosen to lose a specific amount of weight. Frequently, we set ourselves up to fail right out of the gate. We either have an unrealistic deadline and so the extreme efforts required to lose the desired amount of weight are unsustainable over time, or we meet our goal but cannot maintain the loss because we revert back to our old habits.

In reality, losing weight can be relatively simple: Over a prolonged period of time, put fewer calories in your mouth than you used to. It does not have to be an extreme reduction in food. Over time, your efforts will compound, and weight will begin to disappear. 

The catch, however, is that many are unwilling to change their eating habits for the foreseeable future and get discouraged because the resultant loss happens very slowly. Pounds lost this way, however, tend to stay off permanently because a long-term lifestyle change in your eating habits has also been achieved.

Want to lose more weight even faster? Then in addition to eating slightly smaller amounts every day than you used to, slowly, over time, remove items from your diet that you know will hinder weight loss, such as sugar (any type of glucose, fructose, etc.), high-calorie snacks, large amounts of carbs, fatty red meats and so on. Ironically, not only will you lose weight in the long haul, but chances are you will live longer as well. 

Incremental changes outweigh drastic measures

Translate this to a business and the principle remains the same. Many, not happy with their current results, respond in an impatient manner and try drastic measures of some kind to get things moving quickly. They may make commitments to radical behavioral changes, sign up for expensive lead generation programs, hire staff without an effective evaluation process and so on.

Although there may be immediate results, the behavioral changes required usually disappear once it is discovered that they require more effort or funding than a person is willing to expend long-term. As a result, many revert back to their previous norm in relatively short order. In some cases, the end results can actually be worse than when you started — especially if you make a bad hire. 

Instead, it is better to make incremental changes you can actually sustain. As an example, what would happen if you chose to make 20 additional calls per day? Over a normal work year, you would have made 4,800 more calls than you are doing today.

Unless you are totally inept on the phone, even if you only ended up with two clients the entire year, you would be dramatically ahead of the 49 percent of agents across the country who did one or no transactions in 2023.

And, once you have the clients and keep in touch with them after the close, those extra clients compound into additional referrals and testimonials you would not have otherwise had.

You could also choose to add three people to your database every week. It does not seem like much, but at the end of the year, you would have added 152 contacts. Considering it takes a database of only 200 that is actively and consistently worked to produce a decent income in most markets across the country, you would again be miles ahead as a result of a relatively easy behavioral change.

Continue this behavior year after year and your database would become a force to be reckoned with. The compounding effect of those contacts, when worked consistently, would be serious long-term benefits. Just a few minutes a day doing positive activities could dramatically change your life. 

Unfortunately, many choose not to change their behavior because it involves doing things that they do not like or are boring. Who likes eating less food? Who likes making phone calls? With no immediate gratification, where is the reward for consistency?

What small, compounding changes can you make each day?

In truth, there is no end to the positive effect you could make on your future business by adding small, compounding behaviors. These could also include choosing to read 10 pages a day from a recommended business book, writing a couple of cards every day, knocking on 10 more doors — the options are endless, yet the time expended is minimal. 

The flip side of this is behavioral “interest paid”: the result of bad habits over a prolonged period. Think consistent overeating, smoking, excessive time in a sedentary environment and so on. Over time, the negative effects compound, resulting in serious physical issues.

Translate this to your business and, if you incorporate bad habits such as a failure to log past clients into your database and actively keep in touch with them, over time, your business will grow sick and fail to deliver the income you need to survive. This is one of the major reasons the attrition rate of Realtors is so high. 

Put succinctly, compound growth — either in your personal or business life — comes from small, incremental, positive behaviors compounding on each other for years. Success is the sum of small, boring efforts, repeated day in and day out.

The power of compounding lies in its ability to turn small, consistent efforts into extraordinary results over time. Like a snowball rolling down a hill, it begins small but, if the hill is long enough, gathers size and momentum until it is unstoppable. 

Lack of discipline coupled with impatience, on the other hand, causes significant problems that also compound over time in a negative way. A vast number of relationships, including marriages and business partnerships end, not because of large single events, but because of an accumulation of small items that, over time, build into resentment that becomes insurmountable.

It is the same for any given business that fails. It is usually not a catastrophic event that leads to its demise, but a compounding of small, poor decisions over time. 

Small incremental improvements in habits, skills and knowledge lead to significant growth and progress. This can pay dividends in many areas of your life, including better health, self-improvement, career advancement, business growth and overall well-being.

Whether learning a better way of eating, a new language, a musical instrument or a professional skill, the compounding effect of consistent effort over time results in mastery. Again, quoting Ben Kinney, “Small decisions equal big lives over time.”

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