Fitness and Financial Principles

One of the best things people can do is learn from others outside their direct industry to find similarities or a different way of thinking about something. Luckily for me, all of our members are in different lines of work than we are, which leads to me learning from them every time they’re in our gym working out. It’s a great deal. I make them do split squats and sled pushes, and while they’re catching air, they give me some insight that helped them. Over the last ten years or so, one of the areas that relates best to fitness seems to be personal financial habits. As a small business owner, you’re forced to learn financial responsibility, or you’ll simply go out of business. When I begin to apply what some of our members were teaching me along with my own research into financial health, it became clear to me that financial and physical health follow the same principles and also have the same common traps that trip many people up in their journey. It’s worth noting, I’m not a financial advisor, but we do have some great people in our gym that can help you. These are just my experiences along with our members, and when I applied their lessons to my life, it improved much like their fitness improved when they applied my fitness lessons to their lifestyle. Both physical and financial health need to be in check to live a better life. There are people who focus too much on fitness and worry about paying bills, and there are people who watch their investment portfolio grow as their waistline grows at a similar rate. Having a balance is a great approach to reducing stress and increasing our ability to enjoy the things we love with the people we love. 

Have a Plan

This should be step 0.5, but many people simply don’t have a plan for fitness or finances. They just assume it will get better by proxy of time without direct focus. This sadly isn’t true and will carry on as long as we neglect it. Even if you don’t want to hire an advisor or trainer, I think it’s beyond valuable to pay someone for a few hours of their time to help establish where you’re currently at and determine next best steps based on your goals. You can always adjust your plan as seasons of life change, but this creates a framework to help make educated decisions. 

Reduce Excess

In fitness, this could be getting your body fat down to a healthy range while in your personal finances, this could be getting out of debt. This is step two in Dave Ramsey’s baby steps. Some people will argue about leveraging debt, but for many people, it becomes a never-ending cycle which forever limits their future growth potential because your paycheck is already allotted to paying debts instead of investing. In health and fitness, reducing body fat makes everything better. Healthy body fat for men is 20% or lower and 30% or lower for women. This is best controlled by lowering caloric intake gradually over time while using strength training to support muscle mass. This leads to better body composition and shows better long-term results as opposed to lowering calories alone. 

Create an Emergency Fund

An emergency fund of 3 months of expenses is a great first target, and the size of the emergency fund should increase as the number of people depending on your salary increases. Also, if you have inconsistent or high income or are highly specific in your job, you should consider a larger buffer. In fitness, you build your emergency fund with a little movement and healthy eating each day for years. This is why when healthy and strong people have surgeries, they seem to recover faster than others. It’s also why your friend who eats cake every time you see them doesn’t seem to ever gain weight. They have built a larger engine through years of training and healthy eating. They also probably don’t eat cake frequently. 

Avoid Quick Fixes

The noise around quick solutions has the volume turned up way higher with the internet and algorithms. Here’s the upsetting part. Changing your financial and physical health are both long-term games. Most people are much better off finding a basic exercise routine to perform three times a week and following a basic nutrition plan that they can sustain forever than trying challenges like 75 Hard or Whole 30. In finance, only 1-3% of active day traders outperform basic index fund investing. In fitness and finance, my general rule is boring is a pretty solid bet for a majority of it. You can add some spice once your bases are covered and you can minimize potential negative effects. The shortcut is always the long way. A lot of people have ruined their lives over quick-fix health and financial solutions. 

Automate

To be transparent, we had many clients who, for years, I couldn’t figure out why they were coming to us for their training. Some had great gyms in their house and had decent knowledge of training and nutrition. Some even had a great training foundation from playing sports previously. Then I realized, as I got older, that they were automating their fitness. They no longer have to think about when to work out, what exercises to do, how much weight to use, etc. It also ensures that they do those exercises that they hate but know provide huge value for their goals. In recent years, I’ve let other people handle my training, nutrition, and health, and I’ve realized how great it is to remove my thinking from these things. In investing, this is called set it and forget it. Most of us wouldn’t remember to make their frequent deposits into their retirement or investment accounts, and time goes quickly. Soon, the year wraps up, and we realize we spent more on DoorDash fees than on our retirement. Automating your investments removes thinking and emotions, which are both dangerous to your financial health. 

Consistency and Compounding

These could each be their own sections, but they’re heavily connected. No training or investment plan is worth much without consistency because it misses the compounding effects. The home run workout you had on Monday means nothing if you don’t move your body the rest of the week. I have yet to meet anyone who made one investment that went so well they were able to retire and be done. One of the biggest benefits of consistency is it compounds the habits that teach us what is working or not. When someone hits the lottery, their chance of being broke within five years is high because they don’t always possess the skills to manage a large injection of money. This happens when people lose a lot of weight aggressively through medical interventions or extreme caloric restriction. All of your decisions compound at a slow rate, and we generally don’t notice them until they’ve been building for 5-10 years. Here’s an example I like to use: in fitness, you can substitute steps or calories to help paint the picture also. 

$100 invested monthly for 10 years at an average return of 10% per year = $20,484 total on $12,000 invested. 

$100 spent monthly for 10 years = $12,000 spent.

This input is slightly different and results in a difference of $32,484. This is how subtle changes create big results over a long period of time. 

Interestingly, when I started to apply financial principles to my own training, everything seemed to get better and simpler. This was after almost 20 years of lifting weights. Many times, people will feel like they’ve missed their opportunity to invest or to change their health, but the truth is today is always the best day to begin. 

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