The Compound Effect by Darren Hardy (2024)

The Book in Three Sentences

The compound effect is the strategy of reaping huge rewards from small, seemingly insignificant actions. You cannot improve something until you measure it. Always take 100 percent responsibility for everything that happens to you.

The Compound Effect summary

This is my book summary of The Compound Effect by Darren Hardy. My notes are informal and often contain quotes from the book as well as my own thoughts. This summary also includes key lessons and important passages from the book.

• “Talk about things that matter with people who care.” -Jim Rohn
• The compound effect is the operating system that has been running your life whether you know it or not.
• “There are no new fundamentals.” -Jim Rohn
• Success is doing a half dozen things really well, repeated five thousand times.
• You don’t need more knowledge. You need a new plan of action.
• Consistency is the ultimate key to success.
• If you aren’t better, work harder.
• The compound effect is the strategy of reaping huge rewards from small, seemingly insignificant actions.
• Small choices + consistency + time = significant results.
• Tony Robbins’ no man’s land concept is when you’re not really happy about your life, but you’re not unhappy enough to do anything about it. You want to avoid this complacency.
• Knowledge uninvested is wasted.
• Choice is at the center of all success and failure. It is what we choose that makes the biggest difference. Too often we sleepwalk through our choices. We default to choices that our society and culture tells us we should do.
• It’s not big choices, but ones that you think don’t matter or count for much that derail us. You don’t consciously think about it, but these small decisions can really change things.
• Keep a daily gratitude journal about your spouse. Write down one thing you are thankful for each day about your spouse then give them the book as a gift one year later.
• Gratitude is acknowledging there are people in your life who have done things for you that you couldn’t do for yourself.
• What you appreciate, appreciates.
• You have to be willing to give 100 percent in your relationships. Always take 100 percent responsibility for everything that happens to you.
• You alone are responsible for your situation.
• Everyone has the opportunity to be lucky. If you live in a free society, you are lucky.
• The first step toward change is awareness. The best way to become aware is to measure. Writing it all down is key.
• Tracking your progress and missteps is key for long-term success.
• Track your behavior for at least one week.
• All winners are trackers. You cannot improve something until you measure it.
• Professional athletes are particularly big trackers.
• Tracking will revolutionize your life. The author started by tracking every financial decision in a notebook.
• Merely becoming conscious of your actions begins to change them.
• Every dollar you spend today is costing you $5 in twenty years. (Because of opportunity cost from investing.)
• Making small course corrections will result in exactly zero applause.
• The difference between the number one golfer and number ten golfer is just 1.9 strokes. The difference prize money is huge.
• Start by saving 1 percent of your money each month. Then save 2 percent the next month. Continue until you are saving 10 percent of what you earn.
• Dave Ramsey: personal finance is 80 percent behavior.
• The earlier you start making changes the more the compound effect works in your favor.
• The key to success is this: are you learning each day?
• No business is going to keep someone around just for showing up. You have to continually get ready.
• Your life is a result of your moment to moment choices.
• The older your habits are and the deeper their roots, the harder they are to change.
• It stands to reason that since you learned every habit you have, you can also learn new ones.
• If the nose of a plane is pointed just one percent off course when it leaves LA for New York, it will end up in Delaware once it gets to the east coast.
• The most motivating choices are ones that align with your “why” and your purpose.
• You need a deep why for doing stuff. With a why that is meaningful enough, you will do almost anything. (Think of Kristy exercising for the wedding.)
• Too many people focus on achievement without fulfillment.
• If you create goals for yourself that have friction with your values, you’re going to self-sabotage or feel guilty about your progress. For example, if your family is a high priority, but you set high financial goals for yourself then there is friction between those two goals. (Note: this is basically identity-based habits. You can’t have friction between your identity and your goals.)
• Design the life you want first and the business you want second. Most people choose a career before thinking about what kind of life they want to build. (Note: great idea. Even better idea might be to test lifestyles. Try one project in various “lives” and see which you enjoy most. Write a book (author), show a photo project in a gallery (photographer), etc.)
• The Law of Attraction is simply directing your attention toward something that was already there.
• Write down your most important goals.
• When you set a goal, most people ask, “What do I need to do to achieve your goal?” Instead, you should ask “Who do I need to become?”
• What is your entertainment vs. education ratio? The top 20% of people spend their time focused on education.
• Stop watching the news. The news just aggregates the worst, saddest, and most stressful stories every day.
• If there is a difference between what you say and what you do, then your behavior is the winner.
• Identify your triggers for your bad habits: the who, what, where, and when that prompts you to start your bad habits.
• Start by eliminating your triggers. Throw out junk food, etc.
• Stop lying and justifying hard choices by saying things like, “It’s not fair for everyone to avoid sweets just because I don’t want to eat sweets.”
• Dean Ornish study found it was easier for people to ditch lots of bad habits at the same time.
• Any new habit has to work inside your current life and lifestyle. The gym can’t be out of the way. It has to be on the way.
• Montell Williams has an add-in principle where he focuses on adding something in to his life rather than what he is cutting out or sacrificing.
• Hardy recommends using a Seinfeld calendar for public accountability too. Hangout in the office, etc. so other people can see it.
• Be patient. You’ve spent years repeating bad behaviors. It’s going to take years to build good ones.
• Momentum is huge. Objects in motion tend to stay in motion.
• The hardest part of momentum is the beginning. But like pushing the merry-go-round on the playground… Once you get moving you can keep going very easily.
• With momentum, you can continue succeeding with less work. It’s easy to keep things running once you have momentum.
• Jack Nicklaus had a repeated pre-shot routine that he did the same way over and over again. A psychologist tracked his pre-shot time for every shot at a tournament and it never wavered by more than one second. Set yourself up for success.
• Book end your days. You can always ensure how your day starts and ends. Finish your most important tasks first. Review your day each evening.
• Commit to doing a relationship review each weekend. Cover what went well in your marriage that week. Rank your relationship on a scale of 1-10 over the last week and then ask what could get it to a 10.
• “Anyone can fall in love. Falling in love is easy. Staying in love takes real work.”
• When you lose two weeks of work, you don’t just lose the work you would have done. You also lose momentum and that is the bigger problem.
• Garbage in, garbage out. Don’t waste your time watching TV, eating junk, reading useless stuff, consuming negative stories, and more.
• Who is on your personal board of advisors? Who are the 10-12 experts you get advice from?
• The best people hire the best coaches. Harvey McKay had 20 coaches. A speech coach, writing coach, humor coach, etc.
• What are you willing to tolerate? If you tolerate people being late that is what you’ll get. If you tolerate earning less than what you’re worth, that’s what you’ll earn. (This is similar to Mark Manson’s idea of “what kind of pain do you want?” Except here it is applied to the negative forces in our life whereas he applies it to our goals and ambitions.)
• Oprah’s 2004 season opener is one of the greatest product launches and examples of going above and beyond expectations.
• Always go a little bit beyond what people expect. Dress a little nicer. Try a little harder.
• There is a difference between learning and studying. Learning leads to knowledge. Studying a topic means you are invested in it and try it out. The world already has tons of knowledge. You don’t need to learn more. What you need is to study, to practice, and to take action on the knowledge you have.

Reading Suggestions

This is a list of authors, books, and concepts mentioned in The Compound Effect, which might be useful for future reading.

• Harvard professor David McClellan’s research on reference groups.