Everything Compounds

There are many different tipping points, some good, and some bad.

Todd Ballenger
November 21, 2025

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"Good to great comes about by a cumulative process—step by step, action by action, decision by decision, turn by turn of the flywheel—that adds up to sustained and spectacular results."

Jim Collins - Good to Great

Lately, it feels like everything is at a tipping point. Economy, jobs, technology, politics - whew… at least the pipelines are filling up again, and all that work planting seeds over the last few months is starting to pay off. I often talk to students about Jim Collins’ hedgehog/flywheel concepts, introduced in his book Good to Great.

The Hedgehog Concept: This is the simple concept that flows from a deep understanding of the intersection of three values:
1. What you are deeply passionate about (Passion).
2. What you can be the best in the world at (Capability/DNA).
3. What drives your economic or resource engine (Economic Engine).
The Flywheel Concept: This describes the process of building momentum through a series of consistent steps that reinforce one another and build on previous successes. It is a key factor in how good companies become great.

I will say it is also how good people become great people.

The Math of Persistence

Every action compounds. Most people underestimate that simple truth because the early stages of any worthwhile effort look flat. You put in hours, calls, content, conversations… and it feels like nothing moves. But underneath the surface, something is happening. Compounding doesn’t announce itself. It’s silent, tedious, and often discouraging—right up until the moment it isn’t. I keep seeing that happening with our students who engage financial advisors and then suddenly find themselves in the middle of a relationship that could 10X their business. Slowly, then all at once, bam!

Think about your business like a flywheel. For a long time, every push looks identical and produces no apparent results. But each push stores energy. Each email, follow-up, offer tweak, client conversion, system improvement, or uncomfortable decision is another inch forward. You don’t know which action will create the breakthrough, because that’s not how compounding works. The tipping point always feels sudden, but it is never random. It is the accumulated impact of hundreds of invisible reps. it’s like the sandcastle you built as a kid, it seems like it would go to the sky, then in an instant, it tips. This dynamic works both ways!

Be like the King! Keep at it, and you’ll hit your mark :-)

The people who win are not the ones who are the smartest or lucky. They’re the ones who can tolerate the desert. They hold the line long enough for the math to show up. They persist through the period when inputs are high, outputs are low, and the temptation to quit is strongest.

If you stay consistent, compound interest will eventually flip in your favor. Just like a loan amortization table, there is a month when the principal finally exceeds the interest. It’s the moment the curve bends. But you only get that moment if you make every payment along the way.

Keep stacking actions. Keep pushing the wheel. Stay in the game long enough for your tipping point to arrive—because it will, and when it does, everything accelerates.

Consumer mortgage debt is like this: if left alone, you persistently pay a mortgage for 30-50 years in hopes that it will eventually be paid off… Hope is not a strategy.

a BORROW SMART CONCEPT
What’s Your Tipping Point?

There is a point where you are paying yourself (principal reduction) more than you are paying a bank (interest on borrowed money). Here’s a fun calculator that allows you to see at what point you tip from more interest to more principal.

For a 9% mortgage, it is about 23 years.
For a 7% mortgag,e it is about 20 years.
For a 5% mortgage, it is about 16 years…
For a 3% mortgage, it is about 7 years…

You can feel why folks don’t want to give up those 3-4% mortgage as they are paying them off fast, but that will lead to potential bigger down payments and drive future home prices higher!

Tipping Point Calculator

tipping-point-calculator-v1-0-945343814239.us-west1.run.app

LIABILITIES
What’s Happening?

Gemini builds a rate ladder like we have in my book - good job

the 50 year mortgage conversation continues

bank of america provides their thoughts

a lot of retirees with a lot of equity

but the market is softening as well

even with very low yields globally

tax refunds could give a boost for spring buying season

REAL ESTATE
What’s Happening?

from Mike Zacardi, and GS housing affordability is improving

sales are stabilizing

interesting, throw this in Chat GPT

prices still staying strong

housing back to normal trend line

“The Half-Century Home Loan”

I signed for a house with a 50-year loan,
A term so long it could get its own phone.
The banker said, “Congrats!” with a confident cheer—
I’ll be paying this thing till robots run for mayor next year.

My grandkids will visit and ask with a grin,
“Pop-Pop, is this house still not paid off again?”
I’ll wink and reply, “It’s a family tradition…
We pass down the house—and the amortization.”

But the payment is tiny, so who am I to complain?
I’ve got cash left for pizza and maybe champagne.
Sure, the term is absurd, but there’s one thing I know—
By year forty-eight, I might finally learn to move.

ChatGPT