Wednesday, 11 June 2008

Gathering compound interest

Compound interest in the financial sense is easily understood by most. It has been explained to me a few times, probably because my reaction wasn't as enthusiastic as it should have been first time around. The point was stressed that interest gaining interest would mean more to me one day. Predictably, that day did arrive but only when an analogy with career decision making and opportunity management hammered it home.

When deciding on a career direction or as part of the process of looking for a new job, the outputs that we as individuals make are essential to our success. If we don't complete applications, respond to advertisements, call our contacts, attend interviews and so on, no-one knows that we are looking. In most careers there are periods of intense effort and output like this and the returns that each of us receive are our reward.

Sometimes the returns for our outputs aren't as forthcoming and this is where the notion of compound interest can be an asset, not just in creating the returns themselves but also in our motivation to bring them about. Compound interest in the context of work/life fusion is about communicating your vision of personal success in such a way that when a suitable opportunity arises, the potential for it to reach you does not diminish over time. Once you realise that your activity of a month ago, three months ago or even last year is still working for you, it is easier to see how individual actions today can contribute to the overall effort.

There are often lulls in any difficult endeavour. Moments when our outputs appear to deserve more tangible results. During these times there is great comfort in the knowledge that the next call, the next task or the next meeting not only incorporates opportunity of its own, it also has a place in the accumulated knowledge and experience that contributes toward personal success.

Financial advisors may disagree but for me this equation holds a lot more interest than discussing compound interest on a pension or savings scheme.

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