Personal Power
I wrote the following to Lorie and she made me put it on the blog:
Another point to make in this context is that we human beings have a very linear short-sighted view of time. Our brains are not equipped to make sense of exponential processes such as compounding. For example, if Supriya were to start investing $100 per month and get an average total return of 10% annually, she will have almost two million dollars in 51 years, when she turns 60. This mathematical fact is not obvious to our brains. Thus humans will always tend to underestimate how much wealth is possible with small and steady investments. And not appreciating the power of such compounding, most of us fritter away our money.
My personal realization is that the key to everything good (be it money, success, art, music, relationships) is mindfulness. The greatest human gift is the ability to pause between stimulus and response, think and choose your response. (This is the great discovery or the Enlightenment of the Buddha, incidentally.) We are indeed very powerful creatures - we just don't know how much!(Incidentally, Stephen Covey has written many pages on this in his "7 Habits of Highly Effective People".)
Another point to make in this context is that we human beings have a very linear short-sighted view of time. Our brains are not equipped to make sense of exponential processes such as compounding. For example, if Supriya were to start investing $100 per month and get an average total return of 10% annually, she will have almost two million dollars in 51 years, when she turns 60. This mathematical fact is not obvious to our brains. Thus humans will always tend to underestimate how much wealth is possible with small and steady investments. And not appreciating the power of such compounding, most of us fritter away our money.
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