---
title: "Invest your time in things that have compound interest."
type: "News"
locale: "zh-CN"
url: "https://longbridge.com/zh-CN/news/109145316.md"
description: "Warren Buffett's annualized return is only around 20%, but with the power of compounding over 60 years (1964-2023), he eventually gained a profit of 43,800."
datetime: "2024-03-04T09:31:30.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/109145316.md)
  - [en](https://longbridge.com/en/news/109145316.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/109145316.md)
---

> 支持的语言: [English](https://longbridge.com/en/news/109145316.md) | [繁體中文](https://longbridge.com/zh-HK/news/109145316.md)


# Invest your time in things that have compound interest.

Incorporating both red and green.

In this anxious and busy era, we need to go against the tide, slow down, and carefully consider where our time should be spent.

The formula for compound interest is:

Where S is the total return, p is the principal, i is the interest rate, and n is the time period. In this formula, the most significant factor is not the principal p or the interest rate i, but the time period n.

We can see from Berkshire Hathaway's returns under Buffett that the annualized return is only around 20% (with 11 years of losses), but after compounding for 60 years (1964-2023), the final gain is 43,800:

https://www.berkshirehathaway.com/letters/2023ltr.pdf

Therefore, the time period n is the most crucial, the interest rate i becomes secondary. To maximize the impact of n and i, you need to enhance your investment wisdom. Buffett believes:

By investing time in reading, reflection, and practice, you will, under the blessing of "compound time," achieve returns far beyond your original expectations.

It is known that Warren Buffett attributes his success to reading 500 pages of books every week; Bill Gates reads a book every week for 52 years. Throughout his career, he also sets aside two weeks each year for reading; LinkedIn CEO Jeff Weiner allocates 2 hours of thinking time daily; Larry Page spends time engaging in deep conversations with every Google employee, from security guards to technical experts, always maintaining an open learning mindset; ...

These outstanding successful individuals are undoubtedly busy, yet they are always willing to invest time in activities that will yield more knowledge, innovation, and strength in the long run.

Initially, the results they achieve daily may seem minimal, but when viewed over an extended period, they will ultimately achieve significant accomplishments.

I refer to the time invested in activities with a compounding effect as "compound time," just like the compounding interest that grows over time, a small habit will bring substantial returns.

Benjamin Franklin's daily one-hour is an example of utilizing compound time, and the time I invest in writing is also a typical compound time.

## In our limited lifespan, we must carefully consider time and allocate it to activities that can provide compound returns.

Which levels of activities inherently possess the attribute of "time complexity"?

## **01 Reading**

Elon Musk is the founder of companies like Tesla and SpaceX.

When people ask Musk how he built rockets, his answer is "reading."

Reading is the most fair way to acquire knowledge effortlessly, regardless of age or social circle.

Talented individuals in various fields are enthusiastic about this high-return, low-input learning method, such as Warren Buffett and Bill Gates mentioned above.

**Investing time in reading not only enhances our knowledge but also provides new insights and perspectives, changing the way we approach problems, tasks, and ultimately altering our destiny.**

## **02 Reflection**

Ray Dalio, the founder of Bridgewater Associates, always records fundamental errors in company operations or strategies in the employee public system and then takes time to reflect with supervisors to find solutions.

Reflection is a crucial step in personal growth, involving periodically reviewing past gains and losses, missed opportunities, wrong decisions, successful experiences, and drawing lessons and guidance for the future.

Some people take an extra step and easily distance themselves from others.

As the saying goes, "A fall into a pit, a gain in your wit." In fact, after a fall, without reflection, there is no gain in wisdom.

Those who are not good at reflection do not gain wisdom even after many falls, while those who reflect can gain wisdom from others' falls.

**Reflection is not an innate human ability but can be deliberately trained postnatally.**

**By consistently investing time in reflection, you will gain higher cognition, more effective actions, and keep yourself in a continuous iterative growth process.**

## **03 Practice**

Amazon's CEO Bezos once said, "Amazon's success is a function of how many experiments we do every year, every month, every week, and every day... If there's a 10% chance of a 100x return, you should take that bet every time, even if you'll fail 90% of the time."

Through long-term practice, Bezos eventually built the entire company, and Amazon did not simply come from his sudden inspiration.

No matter how many books we read or how many cases we reflect on, we will inevitably make mistakes.

But even in the face of failure, we must dare to practice, to make mistakes, rather than stay in daydreams.

Only by continuously investing time in practice can we truly enhance cognition and achieve tangible accomplishments.

If you still feel discouraged, think of Edison, who conducted over 50,000 failed experiments before inventing the alkaline storage battery and over 9,000 experiments to improve the light bulb. Until his death, he obtained nearly 1,100 U.S. patents.

So, ask yourself, what kind of practice are you ready to engage in?

* * *

Signing up for a dance class? Joining a book club? Pursuing another degree? Delving into a new programming technique?

Whatever it may be, life is an experiment, the more you do, the better it gets.

In this anxious and busy era, we need to go against the tide, learn to slow down, and carefully consider where our time should be spent.

**By investing time in reading, reflection, and practice, you will, with the blessing of "compound time", receive returns far beyond your original expectations.**

### 相关股票

- [Berkshire Hathaway B (BRK.B.US)](https://longbridge.com/zh-CN/quote/BRK.B.US.md)
- [Berkshire Hathaway (BRK.A.US)](https://longbridge.com/zh-CN/quote/BRK.A.US.md)

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