Have you heard of the 80/20 rule? The 80/20 rule, also known as Pareto’s Principle or law of the ‘trivial many (80%) and the critical few (20%)’, was named after Vilfredo Pareto, an Italian economist and political sociologist who lived from 1848 to 1923.

This rule states that in many aspects of business and life, 80% of the potential value can be achieved from just 20% of the effort, and that one can spend the remaining 80% of effort for relatively little return.

What does that mean? It means that of all the things that you do during the day, only 20% really matter, because those 20% produce 80% of your results. The reverse is true too, that things that take up 80% of your time and resources will only produce 20% of your results.

It has been said that the 80/20 rule exists in every field, ranging from business to people.

Sales: 80% of the sales are made by 20% of the sales team.
Work: 20% of your efforts produce 80% of the results.
People: 20% of the people you know provide you with 80% of nurturing support and satisfaction.
Focus: 20% of your activities will account for 80% of your success.

How will knowing of the 80/20 Rule help you in managing time better? First, figure out what 20% of the tasks contribute to 80% of the results that you desire, and then put in maximum concentration (means working hard) to those 20% tasks. If you are thinking of trading or investing, perhaps rethink how you can structure your time and effort around making those pursuits worthwhile. If you hold a day job, then your after-work hours (which is approximately less than 20% of your time in a day) will be very valuable in the sense that that is the only time you have for acquiring the skills and knowledge needed for entering the trading or investing field.

Don’t simply try to do more. Just do more of the right things.