80 20 Rule

I am here to share with you the best life hack – ever.

Yes, it’s that good.

It’s so good because you can apply this one hack to every area of your life for massive results.

It’s called The 80 20 Rule. And it’s a game changer.

What is the 80 20 Rule?

The 80 20 rule says that 80% of the results you get come from 20% of the work you put in.

The rule isn’t that strict or rigid though. It’s not always going to be 80% to 20%. But it will always be that a disproportionate majority of results come from a minority of causes. The numbers do not have to be exact, nor do they have to add up to 100. It could be that 90% of outputs come from 30% of inputs, or 60% of outputs come from 5% of inputs. Inputs and outputs do not need to equal 100; they’re completely separate. This is a wide misconception of the 80 20 Rule. For more on that, see The Top 4 Misapplications of the 80/20 Rule by Scott Young via Life Hack.

The point of the rule is that a minority of inputs cause a disproportionate majority of outputs.

Here’s a visual of the 80 20 rule:

80 20 Rule

A Little History Lesson

In 1906, Vilfredo Pareto, an Italian economist, found that 80% of the land in Italy belonged to 20% of the people.

After more research, Pareto discovered that this principle applied to various things, not just wealth.

And while it doesn’t work 100% of the time, it sure does work a lot of the time. While the principle varies in individual cases (it could be 80-30 in a specific instance, for example), this is a general rule that a lot of categories fall under.

Here are some Wiki examples for you:

Sales: 80% of your profit comes from 20% of your clients.
Customers: 80% of your problems come from 20% of your customers.
Employees: 80% of your sales come from 20% of your employees.
Work hazards: 80% of work injuries come from 20% of work hazards.
Crime: 80% of crime is committed by 20% of criminals.

Source: http://en.wikipedia.org/wiki/Pareto_principle

The 80 20 Rule Examples

You can use the 80 20 Rule anywhere in your life where there is an imbalance of results. The point of using the 80 20 Rule in your life is to maximize results and give you more time back to do what you love. Here are some examples of how the 80 20 Rule could apply to you:

1. 80% of your relational happiness comes from 20% of your relationships.

20% of your relationships provide you with 80% of the happiness you have with respect to all of your relationships. Using this rule, you would maximize time and energy on the 20% of your relationships that contribute and give you 80% of your happiness, and minimize time on the 80% of relationships that aren’t contributing much to your happiness.

2. 80% of your weight loss comes from 20% of your exercise.

If you’re trying to lose weight, and you’ve determined that what really causes you to lose weight is the 20% of your exercise that is intense cardio, you would want to stop doing the other 80% of exercise that isn’t producing results for you and focus on the 20% of intense cardio that is. There’s no point in balance for the sake of balance if you’re not getting the results you want.

3. 80% of promotions come from 20% of bosses.

In [easyazon_link identifier=”1857886186″ locale=”US” tag=”financegirl05-20″]Living the 80/20 Way[/easyazon_link] by Richard Koch (see below), Koch states that it’s the 20% of bosses who are going somewhere (moving upward themselves) who are responsible for 80% of promotions. So, who you work for may be more important than what you do. You may want to consider this if you notice you’ve been stuck in them same position for a while, not getting the traction you want.

4. 80% of your grocery bill comes from 20% of the items you buy.

This example comes from Trent over at The Simple Dollar – and it’s true! Next time you go to the grocery store, take a look at your receipt and focus on the 20% of items that cost 80% of your bill. If you’re trying to cut expenses, try to cut there or find a way to get them cheaper. This can lead to dramatically decreasing your grocery bill.

5. 80% of the clothes you wear come from 20% of your wardrobe.

Say what?! This is another example from The Simple Dollar post. After thinking about this one, I realized it’s pretty much true. Take my work shoes as an example. I have 9 pairs and only consistently wear 2 (in the summer, 3). Why do I have so many?! I hadn’t thought about this until learning about the 80 20 Rule. Knowing this helps because the next time I think I “need” a new pair of work shoes, I can ask myself whether they’re replacing the ones I wear, and if not, I probably shouldn’t get them because I’m probably not going to wear them enough.

6. 80% of your income goes to 20% of things in your budget.

Does most of your income go to only a few things in your budget? Your mortgage, car, credit cards, or student loans are examples of a few things that could take up most of your income. With this information you can focus on paying off debt so more of your money is freed up.

How to Use the 80 20 Rule in Your Life

The bottom line is that you can do less and get more.

By focusing on the minority of things that cause the majority of results, you can save time and energy and focus on what’s most important to you.

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Here’s how you can use the 80 20 Rule in your life:

  1. Identify areas in your life where there is an imbalance of results (or where you want to see a change). Consider the 8 main life categories, including: relationships, career, finance, health, personal development, environment, fun, and volunteering.
  2. Analyze the imbalance and determine the percentage of results you’re getting.
  3. Determine the minority of inputs that are causing the disproportionate results or effects.
  4. Create a plan to change your habits so you spend more time and energy on the minority of inputs causing the majority of results, and decrease time and energy on the 80% of things you do that lead to only 20% of results.

A Final Note!

The 80 20 Rule is the best life hack that exists because you can apply it to every area of your life to get maximum results (think: career, finances, health, etc.).

The rule says that a majority of what you do doesn’t give you a majority of your results. It’s the small minority of work you do that gives you the most results.

This is what I teach in Dream Year – my goal setting workbook that is different than any other goal-setting workbook out there.

Instead of focusing on the stuff that doesn’t get you results, focus on the minority of what you do that leads to the majority of your results. Do this in every area of your life to 10x your success.

It’s that good!