You’ve probably heard about the miracle of compound interest, one of the most powerful forces in investment that exponentially grows your returns. For example, investing $5000 a year from 25 to 35 yields more than investing $5000 a year 35 to 60. The 25 year old starter invests $55,000 and ends up with $615,580 at retirement. The 35 year old starter invests $130,000 and still has less at retirement: $431,754. Huge difference!
Let’s apply that concept to your career opportunities.
Here is an anecdote from mathematician Richard Hamming from a talk he gave at Bell in 1986 about doing Nobel-level work: (h/t Kottke.org)
Now for the matter of drive. You observe that most great scientists have tremendous drive. I worked for ten years with John Tukey at Bell Labs. He had tremendous drive. One day about three or four years after I joined, I discovered that John Tukey was slightly younger than I was. John was a genius and I clearly was not. Well I went storming into Bode’s office and said, “How can anybody my age know as much as John Tukey does?” He leaned back in his chair, put his hands behind his head, grinned slightly, and said, “You would be surprised Hamming, how much you would know if you worked as hard as he did that many years.” I simply slunk out of the office!
What Bode was saying was this: “Knowledge and productivity are like compound interest.” Given two people of approximately the same ability and one person who works ten percent more than the other, the latter will more than twice outproduce the former. The more you know, the more you learn; the more you learn, the more you can do; the more you can do, the more the opportunity — it is very much like compound interest. I don’t want to give you a rate, but it is a very high rate. Given two people with exactly the same ability, the one person who manages day in and day out to get in one more hour of thinking will be tremendously more productive over a lifetime.
My takeaways from this: If you want to outperform your peers, start earlier, work harder, and show up every single day. Your performance will compound and your output will dwarf your competition.
How does this play out for someone who chooses to skip college and start working straight out of high school, perhaps with an apprenticeship? It isn’t just a simple “I started four years earlier than my peers” equation.
- Learning new skills starts out slow and then those skills compound exponentially over time.
- Building your personal network starts out small and then grows exponentially over time.
- It takes at least a year (preferably two) of sticking with an entry-level job to prove you aren’t a flake and can handle more responsibilities before future employers will consider you for that next step up. Before you hit that threshold, you start from the bottom again every time you switch jobs. But once you hit that threshold, you can level-up and a whole new world of opportunities are open to you. In the graph below, the yellow highlighted area is the stagnation area you need to grind through. Do a great job for two years and opportunities will abound.
If you start building your skills, your body of work, and your career at 18, you’ll be 4 years ahead of your peers in calendar years, but you’ll be 6-8 years ahead of them in career years. When they are starting their entry-level positions out of college, you’ll have already hit the exponential part of your growth curve.
Here are a few ideas of how you can further compound your career opportunities:
- Swap an hour of TV each night for an hour of reading. The more new concepts and ideas you expose yourself to, the more they mix and create new ideas. You can cover a lot of ground with 365 hours of reading per year! Turn those ideas into reality at your job and you’ll be unstoppable.
- Add podcasts to your commute for even more idea exposure.
- Learn one new thing about the tools you use at your job each day. These will compound with increased work efficiency.
- Volunteer for new projects, especially across departments. This exposes you to new people, new tools, and new skills, all of which have compounding effects.
- Automate as much of your job as you can. This frees more time to try new things, take on new projects, and learn more. This compounds your productivity and your growth.
- Blog every single day. This takes approximately 30 minutes per day and results in a large body of work over two years.
More ways to compound your career opportunities: