Compound and leverage are powerful forces to move us toward our desired outcomes.

I’ve been thinking about these two forces and how they can be used not only to improve finances, but they also apply to other areas of life.

When given consistent effort, some things will compound over time, like interest on money or the growth of a network. If we can identify these things, then we can give them small amounts of consistent effort to see amazing growth over the long term.

On the other hand, leverage can be used to amplify your efforts for outsized returns. In finances, leverage usually means taking on debt to acquire assets. When done right, the assets bring in more dollars than the debt takes out.

Compound plays the long game and trusts that what you put in will build upon itself.

Leverage amplifies your efforts to turn little resources into big value.

Consider the following ways you can put these forces to work for you:

Compound

  • Business- Identify and complete 1 to 3 top tasks each day. You’ll be amazed at what you’ve done in a year.
  • Relationships - Take some time each day to reach out to friends or family. Consistent bits of time devoted to your relationships go a long way.
  • Network - Talk to new people and grow your network a little each week. The more it grows the easier it grows.
  • Money - Put some of each paycheck toward compound investments. At least put it into a high-yield savings account!
  • Health - Brush your teeth twice a day. Floss. Get enough sleep. Eat balanced, normal-sized portions. Exercise a couple times a week. You’ll be superhuman in a year.

Leverage

  • Business - Spend the time to automate routine tasks. Use templates. Create process automations. Delegate when appropriate.
  • Relationships - Leverage other assets for growth in your relationships. Spend lavishly on a loved one to get them a meaningful gift. Use your time to write a heartfelt letter to a friend. Share your skills to help your family.
  • Network - Use your network to bring others into your network. Leverage events like conferences to find like-minded people who are also interested in finding you!
  • Money - Take on a loan to buy an asset that pays for the loan and then some. The loan lets you buy an asset larger than you could afford on your own, increasing your net worth as debt is paid off. Leveraging money is risky, so be smart and don’t over-leverage. Have some reserves to get you out of a pickle if needed.
  • Health - Use your doctor! Leverage their years of medical knowledge to better understand your specific health situation.

What other ways are you using compound and leverage? I’m very curious to know!