What is the Pareto Principle and Why Should I Care?

Filed under: Personal Growth

If we rewind the clock to 1896, we might see the Italian economist Wilfredo Pareto walking up and down the aisles of his garden observing that 20% of the pea plants in his garden were reliably producing 80% of all the peas he harvested.  

As an economist, Pareto found this trend a cause for further investigation and eventually published a paper that collected dust on the shelves of the Bodleian Library until Richard Koch breathed life into it once again with his book: The 80/20 Principle: The Secret to Achieving More with Less.  

Koch’s book led Tim Ferris (popular American Entrepreneur) to write The 4-hour Work Week which stood as a New York Times bestseller for seven years.

In this blog we will take a look at ways you can use this principle to start living your best life with these 5 easy steps!

How To Create Your Best Life: 5 Steps of the Pareto Principle

Have you ever found yourself with a mind full of crap? Of course you have. We’ve all been there, but here’s the trick: You don’t have to. Understanding the Pareto Principle, or 80/20 rule will help you declutter your mind and help you build a solid foundation to creating your best life.

The Pareto Principle says that roughly 80% of all results come from 20% of inputs. With this in mind, it’s time to refocus and declutter!  

Step 1: Your Most Effective Life (Writing)

Let’s face it: many of us will spend our entire lives living with something that makes us unhappy. Perhaps it's your morning commute, what kind of junk you eat for breakfast, or the way you spend your down time.

It can be hard to spot, but if we take a moment to sit down and identify those moments in our lives that make us unhappy, then we can begin the process of creating our best life.

That is where the 80/20 rule comes in.

The first thing you need to ask yourself is “What kind of life do I want to live? What makes me happiest? If I’ve had the worst day of my life, then what activity calms me down and sets my ship back on calm seas?” 

Tim Ferris suggests sitting down and free writing at least three pages with these two prompts:

Prompt 1: What are the 20% of activities/interactions/people/commitments that give me 80% of positive emotions and enjoyment?

Prompt 2: What are the 20% of activities/interactions/people/commitments that give me 80% of the headache/stress/overall negativity in my life?

A Bonus Prompt from Tim: What could this look like if it were really easy?  If I had to pull it off in a week, how could I do that?

Step 2: Declutter Your Life (Toy Box)

I don’t know about you, but I sometimes find I’m thinking about fifty different things at once. It’s exhausting. The thing is, how many of those superfluous thoughts can we get rid of? How much crap do we actually need in our mind?

According to Pareto, only about twenty percent of what’s actually clogging our brains.

Children understand this. Kids love playing with their toys. In fact, they often have a giant toy box full of a spectacular variety. And even amongst that consumer driven horde, they continuously reach for old favorites, the same toys they have played with over and over again because it makes them happy. 

In essence, all those extra toys are just cluttering up their play space, and it is the same with us. 

Write down a list of all the things that you did today and mark them off: which one’s are essential, which ones make me happy, and which do not. Then be ruthless and cut out the bad ones. You’ll start to feel better immediately.

Step 3: Refocus

Now that we’ve removed the clutter from our lives, it's time to zero in on what really matters. This varies for everyone, but one thing we can focus on is purpose. Whether it's a calling, or fate, or some weekend fad, we should approach each one with a direct question: 

Is this worth focusing 80% of my time on?

A friend once told me a story about cake and a high school homecoming dance. He painted a vivid picture of free cake, six sheet-pans of it, deliciously glistening with spun sugar decoration, beckoning with multi-colored florets…

How many pieces would you have eaten as a highschooler?  He noted, “My stomach could handle about eight pieces, so that’s how many I had. I promptly became sick, suffice to say, cake rarely does it for me anymore.”  If he had only eaten 20% of his capacity, then his night would have been fantastic, and he would still love cake.

Take a second look at the list you made and ask which of these are actually worth the amount of time you spend on them.

Step 4: Invest With Purpose

Thus far we’ve spent our time combing through our past looking for trends in what worked really well and what also has created the majority of our headaches.

Let’s map this forward:  How do I want to feel at the end of the day?  Where do I see myself in 5 years?  

It might help for us to consider an architectural marvel like the Egyptian pyramids. 

While it may not look like it on the surface, the Ancient Egyptians understood Pareto’s Principle only too well, and they accomplished their task using two strategies: planning out a solid foundation and using the right materials. 

The pyramid is a strong shape, one proven to last the test of time, and so too will your life if you choose the correct pillars to lay it upon. And you are capable of choosing correctly.

A quick Google search will reveal the pyramids are made of mainly limestone and a few other materials. Some of the greatest structures ever created by the human race are made of mostly ONE material, and they have lasted over four and a half thousand years. 

Go through your list with an eye towards your big picture and identify which behaviors will actually get you there. Underline them. In red if you have to. 

Step 5: Produce Happiness

Since you have already completed the first four steps of this process, step five completes itself. In the abstract, you have just created a perpetual happiness machine, one, in these modern times, we so desperately need.

Yet even now, we are not done with Pareto. 

Our lives are dynamic and constantly changing. Your list will change, as will your big picture. Nothing is static and change is constant. 

And that’s a good thing. 

It means that with Paretto’s Principle, we now have a skill set to crush any obstacle in our path or even avoid them entirely. You made this possible, and since you already have the skills in place, you will only need 20% of your capacity to complete Step Five.

All you have to do is repeat. 

Your best life is worth it.

Pareto’s principle is life changing. And when it comes to improving the quality of your communication, thinking, emotions and behaviours, our Personal Growth Membership gives you the 20 percent of skills that really makes a difference to your life.

I wonder what you will do to start improving your life now?