Hello friend,

How are you feeling? Gearing up for the season?

I hope yours will be magical and bright.

Here’s what’s in today’s issue:

• One big thing. Why looking backward at your year can be more useful than planning the next one. 🗓️

• You have to check this out. More alternatives to New Year’s resolutions, plus additional ways to learn more about the gap and the gain. ⚖️

I’m glad you’re here. Let’s jump in. '🦘

1️⃣ ONE BIG THING

Living in the gain: year-end edition.

This will be my last letter to you for 2025. The year-end is often a time for reflection. It’s also a time when many people set New Year’s resolutions.

I’m sure you’ve seen many articles saying resolutions don’t work, but research suggests they can work if structured properly. To learn more, here is a good article on the “fresh start effect” and how these temporal boundaries (like a new year) can help jump-start new behaviors.

But that is not my focus for today.

Resolutions look forward. What if you looked backward instead?

Idea #1: The past year review.

Tim Ferris suggests a “Past Year Review” provides more benefits than New Year’s resolutions. “I have found ‘past year reviews’ (PYR) more informed, valuable, and actionable than half-blindly looking forward with broad resolutions,” he explains.

Here’s how it works:

Idea #2: Living in the gain.

Last March, I wrote about “the gap and the gain,” based on the book by entrepreneur Dan Sullivan and organizational psychologist Ben Hardy. Here is a one-line summary:

“The way to measure your progress is backward against where you started, not against your ideal,” say the authors. This matters because “most people, especially highly ambitious people, are unhappy because of what they measure themselves against.”

Before we get to resolution season, play around with this idea.

This can apply to many aspects of life. I have found that reframing the same situations with the gap-and-gain framework fundamentally changes my sense of progress, fueling motivation and confidence moving forward.

Here is the full article from last March:

Living in the gain (March 2025).

“Modern wealth isn’t about owning things. It’s about owning time. Most people spend their lives trading the second to get the first.” - Justin Welsh

I've been a fan of Justin Welsh for many years. He's best known for popularizing the "solopreneur" business model. His bio says, “Building my one-person business to $10M in revenue.”

Here are a few more of my favorite Welsh quotes:

• “The biggest reason I work for myself is the freedom to choose how I spend my time, without another adult deciding on my behalf.”

• “We’re so busy optimizing our lives that we forget to live them. My best days have no notifications, no meetings, and nowhere to be.”

This philosophy on the value of time has become my north star.

I regularly ask myself: Will this new life/work opportunity help me progressively gain control of my time, or will it erode that control?

Take a moment to consider your north star.

What is on the horizon you are walking toward as you move forward in life?

Perhaps you are saving for retirement, trying to get in the best shape of your life, or simply waiting for the return of the McRib.

OK, do you have one in mind?

My intent is not to unpack what’s on your horizon. Instead, let’s look at how you measure progress toward your north star.

Measuring the gap or the gain.

There are fundamentally two ways to measure progress.

Let’s start with the default approach. Imagine you’re driving to Austin, Texas. As you travel along, how do you measure progress?

930 miles from home to Austin. Let’s see, that’s about 13 hours without stops. A day later, you assess your progress. OK, now there are 550 miles left to go, or about eight hours.

What are the variables involved? Where you started, where you are now, and the distance left to drive.

How else can you measure progress?

There is only one other option: How far have you traveled from where you started.

If Austin is 930 miles from home, then after a day of driving, you progressed 380 miles toward the destination.

Compare the two approaches. The only difference is what is being measured.

One measures the gap between where you are and where you want to be.

The other measures the gain from where you started to where you are.

At this point, I can imagine you thinking: Kevin, I’m trying to give you the benefit of the doubt, but measuring my progress on a road trip based on how far I have traveled from home sounds dumb.

But pause for a moment and consider how standard a default decision this is. It’s how we measure everything in business and life: We set a goal, make a plan, and then track how far we have to go to hit the goal. That’s how it works. Duh.

Set a goal to hit $10 million in annual revenue. Make a growth plan. When you record $6 million in revenue at the end of the year, you plan to find another $4 million of work.

But what if your goal is not as concrete a destination as Austin? If you have 550 miles left to drive on a road trip and don’t make any wrong turns, you will get to Austin.

Here’s the problem: Many things you might want in life are just abstract ideals. For example:

• Get healthier. Get in shape. Lose weight.

• Have financial freedom. Have enough money to feel comfortable.

• Find a great life partner. Find my person. Be in a loving relationship.

• Be more productive. Be less distracted. Use my time better.

• Keep my house organized. Get rid of clutter.

As I said above, I want to have more control over my time. It’s an abstract ideal.

What happens in these scenarios?

You perpetually measure your progress toward a destination that is always just slightly over the horizon. A mirage you never reach.

You are trying to measure a gap that isn’t quantifiable. You only know one thing: You aren’t there yet.

This is no way to live.

The magic is the measurement.

If your life goals seem like a mirage, always just out of reach, the most interesting solution isn’t refining your goal. It is flipping the script on how you measure progress.

Here’s the real problem: Measuring the gap between where you are now and the goal you set exposes you to several of life’s insidious traps:

1. The hedonic treadmill. We falsely believe we will be happier once we achieve a goal. However, the hedonic treadmill phenomenon “suggests that our general level of happiness, after being moved in either a positive or negative direction by some major life event, eventually returns to a baseline level where it was before the experiences causing the rise or dip.”

2. The arrival fallacy. “The arrival fallacy was first coined by the behavioral scientist Tal Ben-Shahar. It describes the commonly held illusion that once we make it, once we attain our goal or reach our destination, whatever it may be, we will achieve lasting happiness and fulfillment. But this simply is not true. We are wired to want more—it’s the result of millennia of evolution, of living amidst scarcity for most of our species’ collective history.”

3. Unconscious competence. This comes from the “conscious competence learning model,” which suggests we learn new things in four stages: from unconscious incompetence (which has some connections to the Dunning-Kruger effect) to conscious incompetence, then to conscious competence, and finally to unconscious competence. In this final stage (driving is a good example), you forget you are good at something. This is powerful because it allows you to focus on something new without losing the newly learned skills. But it becomes a trap when linked to constantly measuring yourself against future goals. Your sense of achievement is quickly archived into your unconscious. “I’m good at that now. Cool. What’s next?” you ask.

All three of these traps blind you. You lose sight of your gains, forgetting how you struggled, persisted, adapted, and overcame.

Chasing abstract goals that can never be realized… running on a perpetual accomplishment treadmill… obsessing over what’s next… judging others by their shortcomings… comparing your progress to external ideals.

These are direct paths to frustration, anxiety, dissatisfaction, and unhappiness.

For example, Forbes found, “In Gallup’s 2023 ‘State of the American Worker’ report, a mere 39% of Americans believed they were making meaningful progress toward their long-term goals. Meanwhile, in separate studies, between 33% (Harris) and 42% (Gallup) rated themselves as happy.”

High achievers are especially susceptible. CEOs are more than twice as likely to have depression than the general public. 75% of entrepreneurs are concerned about their mental health.

And this isn’t because they set more aggressive goals or work more tirelessly than others. Clear and aggressive goals can inspire, motivate, and focus effort.

The problem stems from constantly measuring progress using a metric where, by design, you always come up short.

Reality is measured backward.

To be clear, this isn't a recipe for covering up missed goals or a proposal in which everyone gets a trophy.

This is a way to bolster your progress and well-being with a tiny shift in how your measure progress.

In the 1990s, entrepreneurial coach Dan Sullivan developed the gap and the gain framework when he realized so many of the elite businesspeople he worked with lived in a perpetual stated of anxiety and dissatisfaction.

He realized it wasn’t just making them unhappy, it was limiting their performance.

Here’s his idea: You are living in the gap if you only see the distance between what you have achieved thus far and your ideal goal. Conversely, you are living in the gain if you measure how far you’ve progressed from your starting point to now.

In my diagram below, you’ll notice the only difference is what is being measured:

Most of us live in the gap. It’s our default setting. Blame evolution. Anytime you measure yourself or your situation against an ideal, you’re living in the gap. This can come in many variations:

• Focusing on being late or stuck in traffic on the way to a fantastic concert with friends when the whole night is a gain.

• Getting a raise, then comparing it to a colleague who got a bigger raise than you.

• Getting a promotion, celebrating over dinner, and then setting your sights on the next promotion.

• Focusing on the fact your child got two bad grades this term when their overall effort and grades have improved year over year. (The same logic can apply to work colleagues.)

• Hitting your long-term retirement savings goal and then worrying maybe it’s not actually enough in these market conditions.

• Being on vacation in Maui and being annoyed you aren’t in the Pineapple Suite.

In the gap, you measure yourself against ideals. These can be self-created or fostered through comparisons to others (something social media excels at). But all ideals are fabrications. They aren’t concrete. They are elusive and perpetually beyond your grasp.

In the gain, you measure your progress from your starting point to now. Each time I do this, I am surprised by how many things I’ve actually completed. My feeling of progress expands. I shift to a positive mindset, which fuels me to keep going.

Researchers have found that confidence does not create success. It's the other way around: Prior success breeds confidence.

Imagine teaching your son to ride a bike. He keeps crashing. Then he feels that first moment of balance and rides five feet, before crashing again. You could measure his progress by saying: You keep crashing, you suck at this, like a psychopath. Or you could yell out: You’re doing it, keep going! and watch his eyes light up as his confidence swells and his motivation to keep trying grows.

Living in the gain.

Let’s return to my north star—my desire to have more control over my time. This goal is highly motivating and helps me make choices.

Of course, living in 2025 means I have client requests that reset my weekly priorities. I also have meetings, including some scheduled by others. I’ll admit, these intrusions into my schedule annoy me. I still get caught in the gap.

Then I look back at my calendar from three years ago. It was jammed. Other adults were planning my week for me.

At that time, a typical week may have included 20 meetings, perfectly spread out to destroy any chance I might do some real work. Today, my average week has two or three meetings. It’s hard to fully describe how happy this makes me.

My options are to get frustrated by the schedule interruptions I still have (the gap), or to realize my progress compared to three years ago (the gain). When I live in the gain, it confirms I'm making the right business and life decisions based on my chosen north star, and motivates me to keep going, even in the face of new challenges that have emerged since I’ve prioritized control over my time as my top goal.

To do or not to do.  

In his new book Meditations for Mortals: Four Weeks to Embrace Your Limitations and Make Time for What Counts, Oliver Burkeman zooms in to how we track progress in a single say. He explains, “Many people begin each morning in a kind of ‘productivity debt,’ which they must struggle to pay off over the course of the day.”

“The productivity-debt mindset turns success into a kind of punishment: each new accomplishment merely sets a higher standard that you now feel you’ve got to reach next time around,” he says, describing a to-do-list variant of the hedonic treadmill.

He offers a way out:

“My favorite way of combatting the feeling of productivity debt in everyday life is to keep a 'done list,' which you use to create a record not of the tasks you plan to carry out, but of the ones you’ve completed so far today… What makes a done list so motivating and encouraging is that it implicitly invites you to compare your output to the hypothetical situation in which you stayed in bed and did nothing at all.” 🛌

What a perfect description of living in the gain.  

Thank you for reading my newsletter this year.

I’m going to take a short break over the next few weeks to make a few structural changes to these letters. After a year plus and 56 letters, I have a better feel for what I enjoy researching and writing, and how I believe these letters can deliver more value.

I can’t wait to get this moving and get your feedback.

Look for my following letter to you on 11 January.

Until then, enjoy a joyous holiday season,