Where is Your J-Curve?

We live in a world where we want things NOW! Not in a year, not in a week, not even tomorrow. I want my money now and I want my health and fitness now!!

 

I used to be 85 pounds heavier than I am today. I had let go of some of my mental and emotional baggage and I wanted that extra weight to disappear instantly. But it took time, effort, and action.

 

With physical goals, there is a natural momentum that builds to create more and more results. Let’s use weight as an example first. I will also talk about money.

 

Health and Fitness Goals

 

When I dropped the first 40 pounds, I felt great! At that point, I also had decided to go back to school for my PhD. So I went into maintenance mode rather than weight-loss mode, and did my best to maintain my health for a few years. When I graduated, I decided it was time to get going again with my health and fitness goals.

 

The first two months were hell with almost nothing to show. That first week, I worked out maybe twice — and it hurt both times! It was not until the end of one month that it felt like I had developed a routine where working out was becoming the “norm” for me.

 

Still, the scale had barely changed.

 

During the second month, I began to see results and the momentum pick up. I began to learn what my body could do and what it needed. And I developed the ability to “push” a little more. It was as if I was gaining a deeper connection with how to get faster results.

 

Sure enough, the weight flew off. In the third month, I think I dropped 20 pounds and the next 15 dropped even faster. Since then, I have gained momentum with my fitness routine, and I know what to do and when to do it. The process began slowly. But once I was in motion, it picked up speed and momentum.

 

Financial Goals

 

The same principle is true for money. I work with a financial expert to help me with my investments. At first, I only had a small amount with him – and the returns were small.

 

See, when you only have $1,000 to invest and you get a 3% return, you’re making $30 per year. Not an inspiring amount, especially in this day and age. However, when that $1,000 gets another zero and is $10,000, that 3% turns into $300. At $100,000, you earn $3,000. When you hit the range of $1 million in your account (by the way, I’m not there YET), that 3% becomes $30,000. Now you are talking! The more you invest, the more momentum you can generate with your investment. In business, it is called a “J-Curve” because the amount of cash flow grows larger the more you have to invest. At first, momentum is slow (less investment, less cash flow or return). However, when the investment is larger, you gain momentum and earn more and more.

 

You want a certain “lifestyle.” We all do!! There is nothing wrong with wanting it. However, if you attempt to be in the lifestyle before you’re ready, you accumulate debt and stagnation.

 

But here’s a simple formula to get you to that lifestyle:

 

  • Save
  • Grow
  • Momentum
  • Results

 

I learned this in business school and have heard some great investors say this. (Thank you, George Fokas, for the reminder on this!)

 

To save is to build up a foundation of money to begin to work with. To grow is the beginning of the momentum. With each act of savings, you start the growth process. Once you have begun the growth process, you build up velocity or momentum. Suddenly your 3% is generating $30,000 instead of just $3,000. Now with that type of return, you have lifestyle and results.

 

I have a simple rule: Grow my savings to a specific point where the growth generates a momentum toward the lifestyle I want.

 

Again, the issue we encounter is that we want things now! We don’t tend to look out into the future and review our goals and momentum. As a part of my goal setting process, I personally look at where I am now and, based on previous results, where could I be in a year, in five years, in ten years, and so on. I stay aware of this. And while I know that the return (e.g. 3%) is the same, I can see that what I am doing now is building momentum and future growth.

 

Building Momentum or Creating Stagnation

 

So here is my suggestion: If you have not done so recently, revisit your career and health goals to determine where you are now. Realize that your actions today are either building momentum or creating stagnation. Add into your goal the idea of momentum and what you need to do to build it.

 

Spend your time eating the pie today and buying the things you can’t afford, and you slow down your progress. I love a good meal and I enjoy being able to buy things that are fun. But what got me to where I am today is that I took the time to build momentum. The formula is simple: Save, Grow, Momentum, and then Lifestyle (Results).

 

Hope this helps you build momentum in your goals!

 

Mahalo,
Dr. Matt

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