The Power of Aggregating Tiny Gains

2 min read


A couple days ago I stumbled across this beautiful chart from James Clear:

source: James Clear

It shows the difference between getting 1% better every day for one year vs. 1% worse every day for one year.

Notice how there is only a subtle difference early on between getting 1% better and 1% worse. But as time goes on, this difference grows larger and larger at a faster rate due to the nature of compound growth. Those tiny daily improvements aggregate into massive long-term gains.

This visual reminded me of a similar graphic I came across in The Slight Edge by Jeff Olson, which depicts the contrast in paths between simple disciplines made over time vs. simple errors in judgement made over time: 


This visual tells a similar tale: the key to crazy long-term growth lies in making incremental improvements each day, which are hardly noticeable in the short term, but make all the difference in the long term.

I have noticed this phenomenon play out in my own financial life. On the first day of each month I track my net worth using Personal Capital. My net worth increases by around $2,000 – $5,000 most months, which doesn’t feel like much. And it can be discouraging especially during months when it increases by less than $1,000. 

But over the past two years, these mild monthly increases have accumulated into over $100,000:

NW Sept 18

This growth has been the result of consistent monthly gains, which have been born from a few simple habits:

Tracking my net worth on the first day of each month.

Tracking my total spending on the last day of each month.

Ensuring that my “steady” expenses – rent, utilities, and transportation – are kept fairly low (usually under $1,200) each month.

Consistently investing in index funds each month.

These habits are fairly simple and mundane, but they have helped me save $100k in only two years

While I only make a little financial progress each month, it’s over the course of years that this progress becomes substantial and will eventually be life-changing.

On a much larger scale, this is what has helped Warren Buffett accumulate billions of dollars in net worth over the years. Consistent, steady gains that resulted in insane long-term growth:


Tiny, consistent gains are hardly noticeable as they’re happening, but once they begin to accumulate they become an incredible force.

And to make these tiny, consistent gains, you need to embrace repetition and patience. As Bruce Lee said,

“I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.”

And as Angela Duckworth wrote in Grit:

“Enthusiasm is common, endurance is rare.”

Don’t just practice healthy financial habits for a few weeks. Practice them for years. Integrate them into your life.

Focus on making tiny financial gains through tracking your spending, tracking your net worth, minimizing your “steady” monthly expenses, growing your income each year, and investing wisely. Over time, these tiny gains lead to financial freedom.


Zach is the author behind Four Pillar Freedom, a blog that teaches you how to build wealth and gain freedom in life.

Zach's favorite free financial tool he's been using since 2015 to manage his net worth is Personal Capital. Each month he uses their free Investment Checkup tool and Retirement Planner to track his investments and ensure that he's on the fast track to financial freedom.

His favorite investment platform is M1 Finance, a site that allows him to build a custom portfolio of stocks for free, has no trading or maintenance fees, and even allows him to set up automated target-allocated investments.

His favorite way to save money each month on his recurring bills is by using Trim, a free financial app that negotiates lower cable, internet, and phone bills with any provider on your behalf.

His favorite micro-investing app is Acorns, a free financial app that takes just 5 minutes to set up and allows you to invest your spare change in a diversified portfolio.

His favorite place to find new personal finance articles to read is Collecting Wisdom, a site that collects the best personal finance articles floating around the web on a daily basis.


Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.

13 Replies to “The Power of Aggregating Tiny Gains”

  1. Zach…do you buy index funds shares whenever you get paid during a month (end of month or every 2 weeks depends on your pay period) regardless of the price of it or you wait until the shares go down in price to buy them?

    1. I buy shares whenever I get paid, which happens to be once per month. While it would make sense to wait for prices to decrease before buying, it’s impossible to time the market and to know when prices will actually go down. In particular, since the stock market tends to increase over time, attempting to wait until prices decreases means you’ll often be waiting far longer than you think. This is why I invest consistently no matter what the market is doing.

  2. Your net worth chart looks great. You can already see the compounding effect and that’s just 2 years. This is really the flat part of the curve. In 20 years, the gains will be much more awesome. Nice job and keep at it.

  3. Hi Zach. What would you do with a big chunk of money in terms of this? Go all in, all at once? Create an automatic buy over time (e.g., a certain quantified amount every month/week)?

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