Wednesday, March 25, 2009

Mastery Requires 10,000 Hours

Mastery, Just 10,000 Hours Away by John Paul Newport in The Wall Street Journal provides insight about why it's hard for most people to do well at Personal Finance. The answer is that it takes 10,000 hours of deliberate practice to become really good at any task.

To put that into perspective, working 8 hours per day, 5 days per week, with 2 weeks vacation is equal to 2000 hours per year. So 10,000 hours is equivalent to working at a job for 5 years. In addition, the time invested should be on deliberate practice, which is focused effort of doing things different in an area of improvement. In other words, hard work. So watching CNBC or reading The Wall Street Journal probably doesn't count towards deliberate practice for mastery in personal finance. However, managing a budget, analyzing stocks, or developing a retirement plan probably does.

Assuming it takes 2,500 hours to reach competence (an arbitrary number on my part) and 10,000 hours to reach mastery, the chart below show the time to each. I assumed practice only on weekdays for 50 weeks a year, since everyone needs weekends and vacation:-)

Years to Reach Target Level
Practice TimeCompetence - 2,500 hoursMastery - 10,000 hours
1 hour/day

10 years

40 years

3 hours/day

3-1/3 years

13-1/3 years

5 hours/day

2 years

8 years

8 hours/day

1 -1/4 years

5 years

Given the time to achieve competence/mastery and the complexity of personal finance, it's not surprising that many people have difficulty with financial matters. On the other hand, being a personal finance junkie has probably helped me achieve personal finance competence earlier in life :-)

For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

1 comment:

Andrei said...

You might want to read Malcom Gladwell's "Outliers" to find out more about 10000 hours.