Before looking at habits, it's important to start with values. Why? The reason I came up with values is – I don’t want to climb a ladder and realize after reaching the top that it is leaning against the wrong wall. Stephen Covey says, “Begin with the end in mind”.
After reading multiple books and with multiple iterations, I came up with three core values in my life – health, wealth, and wisdom. I want to see myself as a healthy, wealthy, and wise person in 10, 20, 30, …50 years from now. Yes, it is a long-term journey.
Why Habits?
After I came up with the three most important things I value in life – health, wealth, and wisdom – I’ve spent some time thinking about what things I can do for each value so that I end up where I want to be. Since the compounding principle applies to health, wealth, and wisdom, I thought there should be a few things in each of these areas when done consistently can have a significant impact on our lives.
“Habits are the compound interest of self-improvement.”
— James Clear
Over the past five years, after multiple iterations, I have developed the following nine habits (3×3) on health, wealth, and wisdom. These habits were not formed overnight. These are the three habits I try to be consistent within my three core values. I call these habits with acronyms – S.E.T. for Health, S.I.D. for Wealth, R.L.S. for wealth:
Health – S.E.T.
S – Sleep
E – Eat
T – Train
Wealth – S.I.D.
S – Save
I – Invest
D – Debt (stay out)
Wisdom – R.L.S.
R – Read
L – Listen
S – Scribe/Write
1. Health (S.E.T.)
1.1. Sleep well
Matthew Walker says, “Sleep is your superpower.” After I read his book “Why We Sleep”, my perspective on sleep changed completely. There are so many benefits in getting at least 7 hours of sleep every day. Focus on quality rather than quantity. Gone are those days where I sacrifice my sleep to watch late-night TV or just goof around. Of course, there will be bad days but I try to make my sleep a priority.
Things that helped my sleep – using blackout curtains, taking a warm shower before bed, lowering the room temperature to 68F, and reading before bedtime.
Sleeping habit: Sleep at least for 7 hours every day.
1.2. Eat real food
Even after reading a few diet books, I still think there is so much confusion around diet. But, to keep it simple, the majority can be boiled down to two things – avoid both processed food and sugar. It took me a while to implement other diet principles but I focus more on avoiding any food available in packages and trying to eat real food – food that is close to nature – as much as I can.
“Don’t eat anything your great-grandmother wouldn’t recognize as food.”
— Michael Pollan
A simple rule to identify real food – if your great-grandma doesn’t recognize something as food, just avoid it!
Eating habit: Eat real food (avoid processed food and sugar).
1.3. Train (CrossFit)
There are so many benefits to working out. It doesn’t have to be 2 hours per day x 7 days a week. I realized that working out consistently even for 15 mins a day can yield significant results in the long term. But, consistency is key. I always choose consistency over intensity. I choose consistency over perfection.
I have started going to CrossFit in 2018 and fell in love with it. It taught me both discipline and the power of community. I try to attend 4-5 classes a week. I know there will be bad days but I try to stay consistent as much as I can.
Training habit: Train 4-5 days/week.
2. Wealth (S.I.D.)
2.1. Save at least 10%
Saving is the foundation of wealth. It may sound boring, but without saving, there is no investment. Without investment, there is no wealth. Without wealth, there is no freedom. It all starts with saving. Simple but not easy.
I realized that it doesn’t matter whether I make a return of 5%, 10%, or even 20% on my investments if I have nothing to invest. I believe the most difficult part of building wealth is acquiring the habit of saving. So, I try to save at least 10% of my gross income and work towards a 50% savings rate.
Saving habit: Save at least 10%.
2.2. Invest the remaining
Investing is where the magic happens. Significant wealth can be built even with small amounts. All you have to do is – start early and be consistent. Again, simple but not easy.
After reading multiple investment books and listening to several podcasts on investing, here’s what I figured out – the best way to invest in stocks is to invest in low-cost index funds. I know this approach is not sexy but it works in the long term. Investing is about buying assets and holding them for the longest periods of time (buy and hold strategy).
Investing habit: Invest in low-cost index funds. My personal favorite – VTSAX (Vanguard Total Stock Market Index Fund).
2.3. Debt - stay out of it
Paying off credit cards every month is one of the best personal finance advice I’ve ever received. Just like how compounding works for you in investing, it can work against you in paying debts. Credit card debt is the exact opposite of a great investment.
Most credit cards charge an annual APR of about 20% which is way less than what the stock market gives. Banks will never ask you to pay off your credit card debt. They will allow you to make low monthly payments. They want you to pay interest. That’s how they make money. In this case, compounding works in their favor. Always, always, always pay off credit cards in full every month.
Debt habit: Pay off credit credits in full every month. Period.
3. Wisdom (R.L.S.)
3.1. Read books
“Reading is to the mind what exercise is to the body.” – Joseph Addison.
One of the best habits that has helped me in every area of my life is reading. My whole personal development journey started because of reading. I can’t emphasize more the importance of reading books. Books contain ~10 years’ worth of the author’s experiences, which we can buy for ~10$ and finish in ~10 hours. What a great deal!
Charlie Munger says, “Without lifelong learning, you’re not going to do very well. You’re not going to get very far in life based on what you already know.” Charlie reads so much every day that his children call him a book with legs.
Reading is a great way to keep learning new things in almost any area of your life. Knowledge builds over time, just like compound interest.
If you’d like to check out my top 10 favorite books, click here.
Reading habit: Read at least one page a day every day.
3.2. Listen to podcasts
I started listening to podcasts while commuting to work. My commute time is approximately an hour every day. Listening to podcasts on the way to commute is a great way to utilize time while doing the mundane task of driving. For 5 years, I have accumulated ~1000 hours listening to podcasts. It’s amazing to know how much commute time adds up.
If you’d like to know about my favorite podcasts, click here.
Listening habit: Listen to podcasts during the commute to work.
3.3. Scribe/Write
James Clear says, “Writing is the antidote to confusion.” I have started the habit of writing just to clear my head and to document my learnings. As I kept on writing, I started finding similar patterns between multiple books I’ve read. Writing also brought clarity to my thinking as well.
Writing habit: Write at least one sentence every day.
These are the habits I tend to do almost consistently. I know that there will be some bad days but what’s more important is consistency over intensity. It isn’t one bad meal that will ruin your diet. It is the combination of multiple bad meals.
Author Gretchen Rubin says, “What you do on most days is more important than what you do once in a while.”
Conclusion:
Small changes in the right direction compound positively. Small changes in the wrong direction compound negatively. These efforts don’t have to be radical changes but small changes like reading one page a day, doing a 15 mins workout, writing one sentence, saving 1$ a day, etc add up over the long term.
Instead of thinking all or nothing, always think all or something. I go by the mantra, “never miss twice in a row”. Pick habits that are serving you and do them consistently. Let the compounding do its magic!