Life and Business Success – The Power of Persistence
Ralph Waldo Emerson: “That which we persist in doing becomes easy to do; not that the nature of the thing has changed, but that our power to do has increased.”
Our Power to Do
Since I speak on a variety of motivational topics, I’ve been asked on numerous occasions about the driving force that seems to cause one person to succeed while another individual does not. If you take a closer look, you’ll find that the “power to do,” — or the power of persistence, is a driving force behind every notable achievement.
Persistence, by definition, is simply the quality of continuing steadily despite problems or difficulties. Although this seems simple enough, the key phrase here is “despite problems or difficulties.” Unfortunately, the human element has the remarkable ability to bring a level of difficulty to even the simplest of things. Problems or difficulties, whether real or imagined, cause us to react emotionally in unpredictable ways. As you can imagine, reacting emotionally to difficulty generally doesn’t produce positive results. Just perform a quick search on the subject of managing your emotions and you’ll see it’s a hot topic for self improvement.
If you want to talk about emotionally charged investment behavior, the statistics can be even more alarming since the decisions have the potential to affect thousands, or hundreds of thousands of dollars.
The High Price of Emotions
According to the Quantitative Analysis of Investor Behavior, a 20 year study conducted by DALBAR, the tendency to react emotionally wreaks havoc on most investor portfolios. In fact, it’s one of the top reasons for investment failure. The DALBAR study proved that investors who make their decisions based on emotions can not and do not have the ability to beat inflation, as they would like. As a matter of fact, according to a study that ended in 2009, the average return for investors in stock mutual funds was a measly 2.3%, while the S&P 500 returned 8.2%. Bottom line here? Relying on emotions causes a 5.9% “emotional gap”. In dollars, an investor’s behavior represents the difference between $100,000 becoming $483,600 (with the S&P 500 returns), or $100,000 growing to $157,600.
The main problem is the fact that despite the myriad of supporting evidence (like the DALBAR study, Vanguard reports, and individual studies) those who experience loss are unwilling to truly believe that their emotions do more harm than good. Just as a gambler on a Vegas weekend trip keeps telling himself that one more roll of the dice will bring the desired results, so the emotionally driven investor, continues to chase quick performance instead of long-term results.
Persistence Explained
Persistence is just as much about what we don’t do as it is about what we do. Whether you are looking to succeed in business, prosper with investments, or make smart life decisions, it is absolutely vital to keep emotions in check (by choosing “not to be reactive”).
I like to picture persistence as the ability to stay on track, to keep running at the same pace, and to continue to move in the right direction regardless of the obstacles, the noise or the voices around you.
With investing, the voices can be our own fears fueled by volatile market conditions, or they can be the advice of self appointed experts telling us to buy or sell right now, before another moment slips by.
With life decisions, there can be ultimatums or voices pressuring us to move in a certain direction. Regardless of the scenario, decisions driven by negative emotions are almost always a recipe for failure.
How do we combat this cycle of defeat? The key to true persistence involves putting the blinders on and moving in the right direction. But, first things first. Can you really put the blinders on and move forward if you don’t know where you’re going? Absolutely not! Often, we put the cart before the horse, moving forward when we aren’t really sure how we will get from point A to point B. Just think about it, how many times have you heard an individual say, “I want to retire when I’m 65 and golf every day. I want to spend time vacationing with my family.” Okay, those are wonderful goals, but unless you have a plan in place which includes minimal debt, prudent investment strategies that you can stick to, and an income that allows you to save for the future, that’s not likely to happen.
In this case, you’ll have to take one step at a time. Do you need to slash your debt? Have you started the process? Do you need to add more to your investment portfolio? Have you even taken the time to actually calculate how much money you’ll need for retirement? These are all important planning steps that can’t be ignored. Remember, you can’t persistently run the path if you aren’t sure where it is.
Are You Reactive or Proactive?
Finally, persistence and success depend largely on taking a proactive approach to our decisions. If you have a plan set down that you believe in, it’s a lot simpler to be proactive and avoid following the crowd. Those who fall into the traps that lead to ruin are those who are wishy washy or double minded. They can be easily swayed into believing just about anything if they are fed the right information. That’s exactly why sales letters and advertisements are so wildly popular.
So, the keys to persistence and success are pretty simple. (Can you handle simple? A lot of people can’t). First, have a plan…Second, stick to the plan. And if you’re faced with the pressure to make an instant decision always opt to wait 24 hours. Many times you should wait even longer, but 24 hours will at least get you out of the danger zone to more rational thinking. You’d be surprised at the clarity a new day can bring. If you are making a decision based on stress, fear, or an ultimatum, always opt for peace. No decision is better than a bad decision.
Armed with unwavering persistence, you can confidently stick to the path you have chosen and ultimately experience success.
“In the controversy between the stream and the rock, the stream always wins. Not through strength, but through persistence.”
Bryan Binkholder, The Financial Coach, is a catalyst for change in the financial industry. With a true passion to make a difference, Bryan offers practical insights on financial topics, investment strategies, and business success. As a business advisor, motivational speaker and author, Bryan is best known for exposing the inner workings of Wall Street and bringing clarity to common investment misconceptions. Be sure to take advantage of his two most popular resources: 7 Deadly Traps of Investing and The Six Pitfalls of Retirement Planning and look for his latest book, 401(k) Conspiracy, authored with Jim Winkelmann of Blue Ocean Portfolios. If you are a business owner, plan sponsor, or 401(k) plan participant, you’ll want this information.
2 Responses to “Life and Business Success – The Power of Persistence”
Comments
Read below or add a comment...














I thought your post was one of the best one’s I’ve read this year for getting me on the right track. Many people fail to understand how finances play into other areas of your life and your posts bring it all together each and everyday. I’ve got you on the RSS feed and appreciate your daily wisdom, ramblings and unique perspective on life and finances
Thanks Marcus, we always try to make the site and articles ‘real life stuff!’ Glad to hear you’re enjoying them