The difference between putting .99 effort, 365 days a year and 1.01 is only 0.02 per day but equals a result 1260 times greater then the former.
In other words a small difference everyday can equal an enormous difference at the end
Corollary: a tiny positive effort each day results in fantastic gain/improvement/growth over time, while the consistent underperformance, even a tiny one, results in massive loss.
Since your life will certainly have many stumbles, and probably more negative surprises than positive ones, giving "a bit more" each day when you're able to pits you way ahead of those who don't, or at least way ahead of where you'd be otherwise.
The formula is correct. Compounding deals with a time factor usually noted as N. This is an exponent since the initial value( 1.01in this case ) is multiplied by itself 365 times. You are thinking of the interest rate which is what is multiplied by the initial (or present) value
In other words a small difference everyday can equal an enormous difference at the end
Since your life will certainly have many stumbles, and probably more negative surprises than positive ones, giving "a bit more" each day when you're able to pits you way ahead of those who don't, or at least way ahead of where you'd be otherwise.