Thursday, November 27, 2014

personal planning

Couples Retreat

A tool that Monica and I use to strengthen our marriage is a monthly couples retreat.

We head off, just the two of us, and spend 48 hours together. I (try to) pull the plug on the internet and she gets to choose all our workouts. We get a heck of a lot done and it's a highly effective tool for our marriage.

M flew down to Tucson on Monday - which gave me 24 hours to clear my inbox before pulling the plug on the net for the next 48 hours.

Satisfaction

My personal outlook is influenced by two lessons that I have learned.

#1 - I'm responsible for my life, and my feelings, right now.

#2 - If something bothers me then consider if I am willing to change. If I am not willing to change then get over it.

I'm still working through my endurance "hangover" from the 100-odd hours of training I did over in New Zealand. One of the effects of endorphin withdrawal is that I can feel dissatisfied with things. It is a common post-camp, or post-race, experience to feel dissatisfaction with some aspect of our lives.

I didn't do myself any favors as I picked of a few bad habits both at the camp, and after. It all stems from getting "too tired" and "too stressed". I can fall into the trap of tell myself "it's OK" and giving myself "treats" that are the EXACT recipe for screwing myself up further.

How I Spent My Summer Vacation

Fatigue intoxication is showing through in this week's photo.

Robbie travels with a Sport Kilt so that he can INSTANTLY change out of his bike shorts once his ride is done.

I found the man-skirt pretty funny (it was 100F in the Valley of Fire) and wanted a photo to remember the moment...

Nothing like dehydration, afternoon lighting and a full body shave to make a guy look shredded. I know all the tricks...


It's been about a year since I watched the bottom fall out of my personal P&L and I consider myself very lucky to have gone through that experience.

In 2009, I have seen people fall into bankruptcy, lose their houses, their jobs... I'm blessed to be able to handle my challenges. In the end, I didn't need to implement my total-disaster-survival plan. I do have it on file though...

For what its worth, I expect that we will see a major shock in the next two years that's going to knock us back into recession. Goldman has never been representative of the financial sector (they are different, and smarter, than the rest). Dig a little deeper and you'll see a huge overhang of debts in all levels of our society. More on that in a future piece.

We've achieved a lot in the last year. Enough that I decided to take a vacation two weeks ago. Last winter, I made a deal with myself that I wouldn't take a vacation until this website was up and running. After I made that promise, my financial life continued to fall so quickly that a two month delay turned into a year of sustained effort to rebalance my family's financial health.

My vacations are different than most and (like it or not) provide a clear indication of my values as well as what truly motivates me. Similar to my personal workouts... I have two main types... me-vacations and monsy-vacations.

I'm not on vacation unless I can completely pull the plug on email -- taking a break from the world provides me with some benefits:

Questions & Actions

The last two weeks have looked backwards and FAR forwards. This week, I will outline my thoughts for what I want to get done over the next year.

When deciding priorities in my life, I ask myself... Will this change my life if it happens?

I also ask myself the opposite... Will this change my life if it doesn't happen?

There are very, very few things in life where the answer to both questions is "yes". The only Double-Yes I can think about is my marriage and the birth of my daughter.

What I Learned This Year

I'm happy to announce that multiple Ironman Champions, Chris and Marilyn McDonald, will be coaching at our St George Ironman Camp (Nov 12-15, $475 includes hotel/breakfast/dinner and 10 CEUs).

That's Chris in the photo - I did my first race in a year (!) last weekend and Chris dropped by (after riding 190K in the Rockies the day before). I took one look at his TT set-up and figured that he'd ride 17 minutes into me! Turned out that I was a bit more fit than I thought - you can read my race report here (click Summary for text). I will be sharing our internal analysis in my XTri column next week.


September is the month where I take the time to do a detailed personal inventory of my life. Before I look forward, I like to look back and see how I did over the last year.

Here is September's writing from last year.

First point... you might be able to predict the future but I am totally clueless!

Creating Your Day Job

The advice, "don't quit your day job" is a common refrain, this week I share ideas about creating the life you want to live.

The photos this week are from our most recent training camp. I'd like to get a few more sign ups for our St George Ironman Weekend in November.

If you know an athlete that might benefit then please have them contact me.

Three days of training, including hotel/breakfast/dinner for $475. That price includes hotel/meals.


A bit of advice on making-it-happen.

Know what you want, specifically.
I have heard many athletes say, I would like to have a job working at training camps.

First... Which camp? With whom? Be specific.

Second... Observe the people that are living the life you (think you) want to lead. What have they done over the last TEN years and are you will to make the changes required in your own life to replicate their long term work. Understand the long term habits of successful people.

The second point is one that Marilyn made at the camp. She was asked what the difference was between success and failure in athletes - I'll paraphrase - Successful people are the ones that are willing to change their approach to achieve their goals.

Greg Bennett made a similar point - When I realized that I was competing against athletes with superior genetics, I realized that I had to be willing to do the work that others find too hard.

These themes return to me in all areas of my life.

Revisting The Game

You will be able to find Part Four of my Understanding Intensity series over on the Training Peaks Blog from Tuesday.


This week saw a big event in the Byrn Household. I lifted my self-imposed travel ban. I had eliminated all travel that had a net negative cash impact on the family.

Banning my own travel didn't change the quality of my life but it did impair my cycling fitness! So... to get ready for Epic Camp New Zealand (sold out), Team MonGo will head down to Australia this winter.

Three camps that I'll be doing to prepare for Epic:

The first two camps are open to experienced athletes at all ability levels. The final camp (in Oz) will be pretty peppy in nature.

Contact me for more info.

The Ghost of Christmas Future

This past week I was re-visited by the Ghost of Christmas Future. I thought that I had shaken him years ago but he returned during a three-day visit to Aspen, Colorado.

By the way... if you get to Aspen then two things to check out... Independence Pass and Maroon Bells. You can drive, or bike, to both locations are they are really neat! Our photo this week is "Ultra G" after a long run spent chasing Mrs. Byrn uphill at 10,000 feet. I'll tell you more about the socks in a future article.

Ten years ago, I had a major change in my life. Over the course of 18 months, I resigned my job, ended my marriage, sold as many of my possessions as possible and left the country where I had lived for seven years. Thirty is a bit young to have a mid-life crisis but, I suppose, that's the best description of what happened.

The changes I made were triggered from an evening spent alone, in a beautiful house, surrounded by all the comforts available to a self-assured finance guy. When Monica reads that sentence she might never leave me alone again...

That night, I realized that I'd be sitting on that EXACT couch ten years later and the only thing that would have changed would be the size of my bank account.

When I left Hong Kong in 2000, nobody would buy the couch (!) so I've carted it around the world with me. Since my decision to leave ten years ago... I have: remarried, become a Dad, lived in five countries, started nine businesses, exited most my deals successfully, and watched a couple deals die.

If you'd asked me in my late 20s what I was working towards, I probably would have said residences in Phuket, London and San Francisco. I was very asset focused and liked the concept of being able to travel the world with a toothbrush. It wasn't until I travelled the world that I discovered that the reality of travel is quite different.

Personal Review, June 2009

Over the last couple of weeks, I made my way through my half-yearly review. Not quite as detailed as my full-blown annual review but useful none-the-less.

This week I will hit on a few topics that might prove useful.


Personal Review
From my point of view, the improvement in the quality of my sleep (from consistent wake-up); combined with moderately challenging training (rather than massive overload, rest, repeat) has done wonders for my productivity and outlook. I'm getting a ton done on all fronts. It's nice to have the extra energy to "step up" and help manage the house.

Similar to the markets, some times all it takes to feel better is for the situation to stop getting worse. There was a lot of negative shocks in 2008, these have stopped coming through as often so even if things merely stay the same... they appear to be improving.

Two quotes I'll share with you:

    "Somewhere in my life something is always @#$%^&" - Brad Feld
    "Life is dealing with problems"

When I can hold these thoughts in my head as acceptance, rather than resistance, they help me maintain perspective. My goal being to deal with things, rather than arrive at a place where everything is "fixed".

Not that there is much screwed up in my life. However, if you look for it then there's pretty much always something you can find to get yourself worked up. If we can't get to relentless positivity then striving for consistent acceptance is reasonable alternative.

Two questions remain outstanding right now:

  • What new subject do I want to study and learn about over the next year?
  • Where, and how, will I fit in my personal retreat? Here I am thinking about making Epic Camp out-bound only for technology. Blogging daily (so I remember a special trip) but not pulling in any media/email/IT over the duration.

The Cure

Our lead off photo this week is Jan Hugo Svendsen - my latest viking buddy.

Jonas "Big J" Colting crowned him King-for-a-Day when he held off the entire camp to take line honors at a stage of the Tour of Sweden.

When the chase bunch contains Clas Bjorling and Bjorn Andersson... it's a huge achievement for an agegrouper to finish first!


Some of my athletes think that I am a mind reader because I have an uncanny knack of knowing what they are thinking. Truth is, I have a limited capacity to read people (just ask my wife)... however, I have built a decent capacity to see, then express what's going on inside my head.

To the extent that I have any wisdom, it is due to slowing my mind down enough to have brief periods of insight into my own patterns and though habits.

Voices of the Heart

Last Sunday, I took the entire day off from my "life" - no training, no internet, no business.

I snuggled with Monica, read a book, lounged around the house and spent time with Lex. I was so far from my daily routine that Monica asked me if everything was OK!

Sometimes we need to hit the reset button. Before Dave crashed his bike, or Steve died, I was going through an attitude re-adjustment. The news of the last few days only served to reinforce the reminders I received from my Book Day.

The book that I read is called Grandfather - it's a story about a Native American's lifelong search for truth and harmony with nature. It speaks to several truths I have discovered in my life, whether it is "the truth" I don't really care.

If you happen to have Australian friends then you'll know that sticking strictly to the facts can impair the enjoyment value of a good yarn, or religious parable for that matter. So whether the tale is true wasn't the point for me. The value in the story comes from the feelings and lessons it conveys.

Why Wait

This week's title is short for "Why wait to be great" - a mantra from my elite racing days. For athletics, the mantra was a reminder to maintain my adventuresome spirit. While it is true that all we really need is a reasonable weekly structure, it takes so long to get decent (to achieve our own 'greatness') that compliance is increased if we maintain the adventure in our training.

In reality, athletics is no different than our wider lives. If you pursue sport for long enough then your approach (and often your successes) will bring out self-limiting patterns and habits. As adult athletes, it is far easier for us to maintain an open mind athletically than in the other areas of our lives (where we've been repeating patterns for years). Perhaps this is a good reason to change careers, or cultures, every decade, or so.

The photos mixed through this week's letter are from "Rich Camp 2009". I spent the last week training with a British triathlete - we checked out some classic routes in Colorado and Utah. It was a blast for me and I really appreciated the chance to share my ideas with Rich. Our trip, and Rich's story, reminded me of a few things that might interest.


Why Race?
Received some interesting feedback from last week's article.

Make Your Fate

Gordon Livingston writes, "only bad things happen quickly". Even with "bad" things, such as a rising uneployment, it takes many months to see the true impact of shocks to the system. The best analogy for large, complex systems is of a gigantic supertanker... it takes a long time to change course but, when it does, expect it to keep moving in that direction for a while.

This week I am going to write about "good" things that have been happening in my life. As I write this, there are a few bright spots in the economy but, unfortunately, I expect the economy to continue to deteriorate. Even when good policy decisions are made, the huge amount of leverage is going to take a long time to work through the system. Having lived through a few economic shocks, I'll share some ideas on the adjustment process in an future article.

An economic depression need not imply disaster on a personal level -- many good things have happened in my life during 2009.

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On Monday, Noon Denver Time, Monica is joining me for a free webinar on Nutrition and Fit Pregnancy. contact me for a slot. We have spaces available.

Desert Lessons - Part Two


At our recent camp in Tucson, I didn't assign myself any formal topic. I wanted to see how the camp played out and give myself a chance to address questions/topics that came up as we rolled through our training.

Part One of this article is over in our column at XTri. It covered questions raised by the athletes as well as what I learned from our coaches.

This week's article covers the key things that I learned from a decade of triathlon (most of which was spent with an evangelical focus on performance). These lessons are personal to me. They make sense "now" but I don't claim them to be universal truths.

I'll wrap up with some tips that I do believe to be quite universal in application. If I had kept these in my mind for the entire decade then I might have enjoyed a deeper level of success.

I float them out there because it would be great to see one of my close friends take the lessons of my success a little further than I was able to pull off. You know who you are and you know what I mean -- I'll keep the specifics to myself because I know what it's like to lay it on the line publicly!

From The Outside Looking In

This past weekend, Team MonGo did our quarterly review of the family's finances. In the current environment, it has been tempting to keep track of things on a more frequent basis but... given the economic volatility, that would impair my enjoyment of life!

The trend that I want to create is a closing of the gap between my expenses and income. Right now, we are deficit spending - not quite at the rate of our national governments (!) but I'd like to stop eating into savings as soon as possible.

I'm conscious of the fact that we are fortunate to have savings to back us up. This most recent review provided empathy for folks that are struggling to cover their expenses. Watching your bank account tick down when you have a mortgage, young kids and are unsure about your job... that would be extremely tough.

Five years ago, I was living off a mortgage on my house in New Zealand. It's a weird situation to go into a bank, explain you work for a loss-making start up and would like to borrow money so you can get through the next year. I was able to sort myself out relatively quickly. I suspect it would be a very different conversation today.

Removing all personal guarantees and paying down my personal debts was the single best investment I made in the last five years - quite possibly my career. In the current market, I continue to believe that the best investment you can make is removal of personal debts, and reduction of net income deficits.

Degrees of Freedom

I was watching the Last Lecture on YouTube this morning. In the talk, Randy Pausch talks about inspiration from achieving our own dreams as well as a shift that can occur when we achieve satisfaction by facilitating the dreams of others.

Somehow, I managed to achieve far more than I ever thought possible. In the times where I failed, or didn't achieve my objective, I learned a lot about myself and the nature of failure.

Whether you read his book, or watch his lecture, it is time well spent. Armed with the knowledge that you have lived well, you can cope with tremendous adversity.

Ultimately, we are all going to deal with our share of challenges (no one gets out alive). The only question is when, and in what form.


I am seeking feedback for a Boulder-based camp this summer. The camp will provide CME, USAT Coaching CEU and an opportunity to learn from coaches/experts in the medical and sports performance fields.

We are also going to do some training and I'll be sharing several of my favorite local sessions.

Drop me a line and I'll send you a short questionnaire so we tailor the camp to your needs. We are looking at July/August and I am aiming for a structure that will keep the price down.

Change Your World

When one listens to the news these days you can get the impression that there is nothing we can do the stem the decline of our collective position.

I wonder how far back we’re going to get knocked in terms of the size of our economies and asset values – ten, fifteen, twenty years? This week's article is not about fear, it is about living.

While it makes sense to be realistic, and work with a sense of purpose, unrelenting negativity can cloud our thinking and, more importantly, greatly reduce our quality of life.

To balance the negativity in the media, I recommend periods of silence and retreats to nature.

The reason the blog is a little late this week is because I was on a training retreat in Southern Arizona. The break did wonders for my perspective, as well as my motivation to keep moving forward.


A quick announcement, we are considering a number of different options for Summer Camp. All will be based in Colorado.

If you'd like to find out more details about what we are considering then drop me a line. I will send out a letter to everyone that expresses an interest in the coming days. Timeframe is July/August 2009. The event will be open to ALL experience levels as well as short/long course athletes.

New Realities

Our photo this week is your author sitting on the top of Africa. Before I was ever a competitive athlete, I used to collect mountains. Fortunately, my hobby didn't kill me!

Thriving in Recession

Through my athletic journey, I learned lessons that that made me a better man in the "real world".

Being a coach is an incredibly satisfying job because I can help people use athletic goals to break patterns/habits that have been limiting their success in other fields. There is no "magic" from the coach, rather, the desire of the athlete... to get to Kona, to win their agegroup, or to finish their race... provides that little extra motivation to keep going when they might have stopped in the past.

What are these fundamental lessons?

  • We consistently underestimate what is possible across a multiple year time horizon.
  • We rarely exceed the goals that we set for ourselves.
  • We achieve our expectations (both conscious and unconscious) more often than not.

More than getting what we deserve, we get what we expect.

Goals, Aspirations and Hubris

Over the last few years, I have prepared my annual "to do" list of goals and tactics. Being achievement oriented, I have found that stating my game plan helps me stick to getting it done.

Of course, one does need to be aware that publicly falling short can be painful... but nowhere near as painful as regret, or the haunting feeling when we know we let ourselves down.

Incentives

Our photo this week is Team MonGo 2008 -- you'll see that Monica bought the family matching pajamas. Check out the sleeves on Lex!
Today is my 40th birthday and I managed to hold my hair this far... that seemed so important to me when I was in my teens and twenties... while my priorities 20 years ago were normal, they weren't exactly ideal.
Lesson #1: having a high capacity to work overcomes a lot of personal shortcomings.

Getting It Wrong

This week I am going to share some ideas that will, hopefully, save you from a large financial loss at some stage in your life. Over the course of your life people will steal from, mislead and generally attempt to swindle you -- if you hit 50 and think that this has never happened to you then you might not have been paying attention!

Skill-based, achievable, wealth creation stems from two principles:
  • Spend less than you earn; and
  • Protect existing capital.
If you do those two points consistently then your net worth will rise over time. Sounds easy but it is seldom done effectively. There are always temptations to cut corners.

Facing Winter & Travel Thoughts

This week I am going to share some ideas on how my winter has been going.

Travel -- is the largest item in my business budget as well as a major expenditure in my personal budget. More than the financial cost, travel has a large hidden cost in terms of use of time and fatigue. If you choose a life where you move around a lot then it makes it much more challenging to achieve in areas that benefit from stability (relationships; athletic training... for example). In seeing the risk to relationships/training, I set my travel up in blocks and brought my girlfriend (now wife) with me as much as possible. While effective, this greatly increased the overall cost to the family.
Travel isn't all bad. A ten-day business trip removes a lot of distractions and long flights are excellent for extended periods of uninterrupted time. Both editions of Going Long had their final proofs reviewed on a long haul flight.

Reflections on Savings and Investment


This week we return to a more financial-oriented letter. Now that the US election is out of the way, it seems like the bad news has started rolling again. The bad news can seem relentless at times and, following my trip around the world, appears to be happening in the US, Europe as well as Asia.

With the mood (near universally) negative, I've been trying to figure out my long term strategy for savings and investment. As I mentioned a few weeks back, I'm currently projecting a cash flow deficit for 2009. I suspect that I'm not alone in being in that position! Frankly, being able to absorb an unexpected set back is why I've been conservative over the last twenty years. I have been reminding myself that the world isn't ending but human psychology can be tough to counter.

Family Finances & Bear Market Psychology


Investment strategy is the topic for this week. I am not going to tell you what I think you should do. Rather, I am going to share ideas about how I approach my family's investment strategy and outline some observations from the last few weeks. An interesting article where the author does offer some "to do's".

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Personal Freedom

A good friend sent me a link to an interview with Andrew Bacevich.  The interview provides interesting points of view on patriotism, foreign policy, projection of power and the central values of American society.  It takes an hour to get through and it was a useful way to spend a Sunday morning. 
The interview is, nominally, with reference to Bacevich's book, The Limits of Power. The author is described as a conservative historian but many of his points are often made (far less effectively) by my liberal friends.  The link was sent to me by a veteran who said that he watched with tears in his eyes because someone had finally put into words what he had felt for years.
An example is his position on "not war" as opposed to peace -- my quote, not his.  It's the first time, I have heard someone talk about the Iraq war in a more nuanced point of view.  Generally, we are presented with binary choices (in/out; win/lose; victory/defeat).  Bacevich goes deeper and examines the impact of a full commitment in one area which limits our ability to commit in other areas.  
As an investor, I look at the opportunity cost of a position.  As a historian, Bacevich does the same thing with respect to the projection of power and the allocation of national capital.  Like many strengths, wealth/force/power/fitness may be most useful when applied sparingly.

Financial Security and Capital Allocation

Financial security and capital allocation are the topics for this week's letter. I have been wanting to write about these for some time. What a background in the capital markets -- a very rough week for people.


I am extremely busy on the business front.  As you can imagine, we face a very challenging time in UK Property.  If you are waiting for an email reply then I will get to you, just need some more time. Each day, I have had to parcel my energy, prioritize tasks and schedule recovery.

OK -- a couple of announcements...

***I turned on comments so that so we can interact. Take it easy on me. You'll find that moderation is 'on' so I need to review before they go live.

***Endurance Corner Radio has podcasts from Joe Friel and Chris McDonald. Send feedback to D.J. J.D., who is leading our effort.  Joe is talking about his background (very interesting) and training. Chris explains how we can break Chris Lieto's course record at IM-Moo by using IM-Loo as part of our taper -- its easy if you just follow his point-by-point instruction for race week...

***Joe is going to be speaking at our Boulder Triathlon Camp next July. The camp is open to all levels/distances and will have a mix of hands-on instruction, training and discussions. Cost is $1,250 -- drop me a line for more details.  We've got some great speakers lined up.

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Who knew the markets would melt down? Personally, I don't blame the short sellers. They are only acting on what insiders and smart researchers have been telling us for months... our financial system needs to be recapitalized. Massive global deleverage is tough. In my own ventures, it is the main cause of the difficult situation faced by friends and clients. 


What lessons can we learn?

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Acquisition of capital is different than borrowing debt. Because debt comes from third party sources, we need to be wary of the tendency to view it as 'free' money. When I work with individuals, or companies, that run into trouble, it is often a crisis created by borrowing to the maximum extent permitted. Permitted under law, permitted under debt agreements, permitted by running X creditcards. An appropriate amount of leverage is well, well below the maximum that can be borrowed.

To me, capital in its most simple form is cash and liquid assets. Before we talk about how to allocate, let's consider how to acquire:

1 -- spend less than you make
2 -- pay yourself first

Physically, I have been overweight before. When I was heavy, I would often wish that I could wave a wand and "be thin". If I could just get a chance to start all over then everything would be alright. I would tell myself that I wouldn't make the same mistakes again.

Finances are a lot like that. When we have no capital, we can spend a lot of time wishing that we had capital.

Physical fitness is just like financial health. Until we take actions, and create habits, that change the direction we are heading... we will keep heading the same direction. We have to make the change.

The two tips that I shared above come from The Richest Man in Babylon -- a good read on the topic of personal finances. I like that book because it doesn't make things too complicated.


3 -- Protect core capital.

What is core capital?  Put simply, it is capital that you cannot afford to lose.  Having no assets at 65 years old is a far different situation than being wiped out in your 20s.

At 40 years old, my view on core capital is ten years living expenses.  While the income from that capital doesn't come close to covering my living expenses, it does give me years to adjust when faced with an unexpected setback.  Across a full career in business, we can be certain that we will face multiple setbacks.  After the past 14 days, the importance of core capital has become very apparent. 

How do I protect core capital?

4 -- Be wary of leverage.

My core capital is completely unleveraged.  While this reduces my return, it greatly reduces the risk profile on my portfolio.

I go even further in that I don't care about my investment return on core capital, I care about safety.

Within my business projects, I am willing to use leverage but, these days, only with capital that is above my core capital.  Why am I so conservative?

5 -- You only need to achieve financial security once.

By following the basic principles in my book recommendation you can give yourself an excellent chance to achieve financial security over your lifetime.

Sure we are exposed to Black Swans but you can stack the deck in your favor if you educate yourself and stick to the basics.

It is surprisingly difficult to stick to the basics.  We let our guard down, we cut corners, we are less careful.  We need to be constantly vigilant!

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For capital allocation, my first consideration is where I will be living in the future.


This is important to make sure that I have assets (and currencies) that will balance my future liabilities.  While I don't trade currencies, I consider purchasing power parity when deciding about large investments which match, or don't match, future plans.

I don't have a lot of sophistication in my review -- I look at things such as daily living costs, relative prices of accommodation, interest rates.

When I think about property purchases, I am very specific -- seeking good value, in a specific neighborhood, of an appealing city.  I define value back to my long term currency.  For me, that means converting back to USD, the US is my likely home.

The cities that I really like are: Edinburgh (GBP); Paris (EUR); San Francisco (USD); Hong Kong (quasi-USD).  I don't have any exposure to those markets presently but I keep an eye on them.

Currencies that I like are USD (matched to long term liabilities); CHF/EUR (long term stability).  Some people like Singapore dollars but you only need to look at a map to see that there is real political risk in the neighborhood.  In terms of Asian exposure, my preference would be a moderate yielding real property investment in Hong Kong.

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When I was starting out, I thought that it would be nice to "be rich" -- whatever that means.  Along my journey, I have realized that wealth is neither the goal, not the benefit of financial security.

The two main benefits are ethical reinforcement and personal freedom.  If the pursuit of wealth forces you to compromise your values, or ties you to unpleasant situations... then one really needs to consider if that is a benefit at all.

Following the events of this past week, a very relevant consideration.

gordo

2008 Review, Part Two


This week’s letter is about taking the time to consider the long term implications of our current choices as well as offering some insight into how I approach my personal planning.

The photo above has me thinking about some additional adjustments to my TT position - I will be tinkering this winter!

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If you haven’t been to the Alternative Perspectives page in a while then you might enjoy two articles from Coach Kevin Purcell. The most recent was a thought provoker for me and very enjoyable.

2009 Boulder Camp – I am very happy to confirm Joe Friel and Bobby McGee as guest coaches at our Summer Triathlon Camp. Joe and Bobby have been instrumental in my athletic career and share more than fifty years of collective coaching experience.

As a reminder, the camp will run from July 20 to 25, 2009. By letting you handle your accommodation and morning meals, we have been able to set the cost at a very affordable $1,250. This camp is open to all abilities, all-distances and will have a balanced focus between skills development, triathlon training and athlete education. To confirm a slot, please drop me an email.

Two book recommendations for you: FIASCO is a great read about structured products and investment banking – it fits with my observations from a career inside the financial services industry.

Website Optimization is a good read for anyone that runs a web driven business, or brand. The book made me realize how little I know -- lots of easy ways to improve the reach of my writing. I read the book with pen, paper and a high speed internet connection. I approached the read like a "workbook" taking notes and making changes to my website outline.

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I was walking around Edinburgh this week and noticed that it is impossible to see a credit crunch. The buildings don’t know who owns them, or the prices that we place on them. That realization settled me down at the start of a very busy week. The UK faces challenging economic times.

My trip to Scotland confirmed suspicions on the state of my personal NAV. Long time readers may remember that I sold my UK property exposure in 2005/2006 and used a portion of the proceeds to help establish a Scottish residential property developer. While the development business is stable, the market outlook for sector is weak.

I’ve seen a big reduction in the upside component of my personal portfolio and a stack of paper profits went up in smoke. My marked-to-market net worth went down significatly in 2008. No wonder investment banks are looking for a way to avoid reporting the true market value of their illiquid securities. It was a (very) good thing that I am not personally leveraged -- I would be toast if I was a hedge fund.

Interestingly, prime residential rents are way up in Scotland. We have seen a 50% increase in our portfolio yields over the last three years and, I suspect, there are more rental increases to come. The upward yield shift gives comfort to our bankers (in a time when they aren’t hearing a whole lot of good news).

We haven’t seen any evidence of forced selling by developers. This could change if the main lenders take a hard line but, to date, all the key participants seem content to sit-it-out until market conditions improve.

Times like this are potentially volatile because if everyone is doing nothing then there is substantial downside risk if assets (at the margin) are forced through the market. Prices always move at the margin and, in a thin market, the actions of a few can impact the balance sheets of the many.

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The Tri Biz
While there isn’t much that I can (or want to) do with my personal balance sheet, I have taken a hard look at my personal profit and loss account.

Over the last three years, my largest single expense category has been “triathlon”. In 2005, I downsized my sources of triathlon revenue to create space for a big increase in my financial consulting business. The net cost of doing that was probably on the order of $100,000. I suspect that is a much smaller cost than many athletes bear when they downsize work commitments to focus on qualifying for World Champs. A single year off as a doctor, investment banker or CEO can cost a multiple of my figure.

I’m fond of saying that the easiest way to increase net income is to reduce personal expenditure. I remind myself of this because the consumption treadmill is a seductive trap, constantly marketed to us through the media.

In my annual review, I look at my expenses (current, projected, core and surplus) as well as my revenues (current, projected, downside, potential). I would encourage you to do the same.

Why? Because we always underestimate the large effect that small changes have over the time lines of our lives.

$33K per annum, for seventeen years, at 4% is $782,000.

By taking action to eliminate my net triathlon cost (today), I can finance my unborn daughter’s college education (tomorrow). Of course, all this is contingent on not spending the money elsewhere, or being miserable with the change. We can take cost control too far.

For me, starting a business helps spending discipline. My accountant tells me that the IRS will "help" further by disallowing losses if we lose money for three consecutive years. As well, I have considered bringing in a financial partner to create social, and profit, pressure. There are a lot of benefits to 100% ownership (see Raising the Bar) but I also benefit from having obligations to people I respect.

My game plan for personal expenditure control:

***Focus on the training camps that I am hosting Tucson (April); Epic France (June); and Boulder (July). Last year, I attended nine training camps and only one made a positive contribution to Gordo Incorporated.

***Consolidate the best of my writings into a single location for you (the reader) to access easily. The best marketing lesson from my triathlon experience is “give away good information for free”. Helping people is fun and creates massive goodwill. I have a stack of content spread between five websites. My content is underutilized and tough to access.

***Place my library within a website where I will be able to combine: (a) my coaching skills; (b) my writing skills; and (c) my enjoyment of helping people learn from athletics.

My financial consulting business has (effectively) total concentration with a single client. I am a big believer in the value of concentration (and the illusion of diversification). However, small things matter over long timeframes… one, or two, additional relationships will make a difference.

The benefit of my business model is it fits with my desire to main freedom of location and schedule. Commitments given to clients limit my freedom of occupation (somewhat), but I love working and there is a fair exchange.

An up-coming letter will discuss (in detail) my current personal portfolio strategy. While my outlook hasn’t changed, my portfolio structure changed (due to those paper profits evaporating).

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The Truly Precious
Because time is far more precious than money, I also do a time inventory. I have become provicient at considering my happiness return per hour. Still, it takes constant pruning to maintain a high quality life.

There are clear requirements to a long term focus on elite athletics. These requirements have associated costs that can increase over time.

Financial – outlined above.

Structural – to run well in triathlon, I need to maintain a high level of annual run volume. Having spent most of 2007 walking around my house in fluffy slippers (to comfort bruised feet), I know that the required level of volume is wearing my feet out.

Emotional – I don’t know about you… but I am not a whole lot of fun from three to eleven weeks out from a key competition. I used to get around this by living alone in the spare room of a fellow endurance athlete, or hibernating upstairs at my house in Christchurch. The IronMonk-gig worked for athletic performance but lacked in terms of emotional well-being. I have increasingly found that I can’t be the husband I want be while spending 20 weeks a year on the knife edge of human endurance.

Monica is so completely loyal that she’d back me for another five years of relentless focus. She respects me too much to offer the soft option of backing off to please-the-wife. I didn’t truly understand the brilliance of doing that for your husband until this year. If you are married to somebody like me, it is the best way to ensure peace of mind in your man. I’ve got a couple buddies that have managed the freedom but haven’t (yet) found their peace. Don’t think that I’ve necessarily found any!

Addicts come up with all sorts of ways to justify their actions. Generally, I am only able to fool myself for five to fifteen years at a given vocation. Increasingly, I find better and better things to focus on. Fatherhood represents another opportunity for self-knowledge.

I have been truly fortunate to have the opportunity to spend much of the last decade living as an elite athlete. It has been a tremendous experience and worth all the overtraining, financial costs and other occupational hazards. I rarely regret the past, even my mistakes and “hard times”.

One of the main hazards of objective decision making is caused by a combination of consistency bias, overvaluing what we own and overweighing sunk costs. “I have given up too much to change course” is a common thought pattern that can skew clear judgment. There are also tremendous social pressures that we place on each other to remain consistent in approach. We have an in-built bias against “flip-floppers”. This is a bit odd in a world where most of our key decisions are made against a background of incomplete, and changing, information.

I have always enjoyed “doing what it takes” and, I suspect, that most obsessed folks are excellent at getting the job done. Seeing this trait, could be why Monica likes me to have a project. Too much idle time leaves me short on endorphins.

It’s an interesting time for me. With my sport, increasing costs are reducing my enjoyment from doing what it takes. Frankly, I’d rather be a world class person than a world class athlete. I am fortunate to have been exposed to role models that manage to do both.

Since 2004, I hoped that winning Ironman Canada would give me a fairy tale ending. Just like Monica, Life doesn’t appear to have offered me an easy way out.

Back next week,
gordo

2008 Year In Review, Part One, Athletics


This week's photo was taken while I was competing in the speedo division of Ironman Canada 2008. I am going to write up my race report for the Planet-X website. Additionally, my pals at XTri.Com have published a recent Q&A.

Long time readers will know that I like to spend September reflecting on how things went over the last year. This year, I am a bit ahead of schedule and will share some ideas that I have been considering throughout August.

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Why Compete?
It may surprise you to learn that I don't really enjoy the "competing" part of athletic competition. While it is fun to win, how many of us are consistently dominating? Not me. Even when I win (or my clients win), I have concerns that the pleasure that I experience is just my ego being inflated. Humility does not come naturally to me and requires constant vigilance.

For short course racing, John Hellemans says that if you feel like quitting then you are going the correct effort. He is a multiple agegroup world champion and Olympic coach, so I remember his words. For much of this summer, I had that sensation in training -- I noted those feelings and reminded myself that, for Ironman, they were a clear indication that I was on edge and needed to be careful. I counted down my sessions, and the days, until Ironman Canada.

So why compete?

I have been getting slower for my last three years of Ironman racing. Similar to dying... we all know that slowing down is coming but it is a bit of a surprise when it actually arrives!

Why compete? Many valuable experiences are not pleasurable. The main personal benefits that I receive from racing all seem to come with "coping". We are all going to get knocked around a bit in life. Racing gives us a safe environment to train our coping skills. More specifically:

Coping with Public Success and Failure -- IMC 2007 was a public failure of a clearly stated goal. The failure caused me a lot of personal pain. However, trying our absolute best then failing... is liberating once we get past the pain. I am, mostly, free from concern over public performances. When I faced challenges in 2008, I looked inward... how do I want to respond to this decision, not... what will others think of this decision.

Pain results when Expectations (not performance) diverge from Results. Crisis comes from our expectations -- an athlete preferring to quit, rather than face the reality of their performance. Quiting stifles personal growth and, speaking from experience, it is far better to fail than quit. Getting across the finish line creates closure -- a DNF (that doesn't involve an ambulance ride) often remains an open wound.

Learning to cope with success is also challenging. People that like us for no reason aren't much different than people that hate us for no reason. It takes considerable self-esteem to remain ethically centered in the face of consistent positive feedback (social, financial, athletic...).

Dealing with a Lack of Control -- Control and stability are illusions, just ask any 68-minute Ironman swimmer! Racing drives that home to me, again, in a safe environment. Learning to manage our emotions, and decisions, while under extreme duress is a HIGHLY valuable skill that we take back into our daily lives.

Reaching Beyond Ourselves -- I have never made the lead swim pack in an international level triathlon. But... I don't rule it out! Racing provides us with an environment where we can achieve things that we thought were impossible. I've had a couple of disappointing Ironman races but... if I do happen to RIP one in the future... wouldn't it be great. Athletics have consistently shown me that I am capable of much more than I can imagine.

For me, the lessons of competition revolve primarily around self-awareness and self-control. Which leads nicely to...

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Race Status, Elite versus Amateur
While I was counting down the days to Ironman Canada, I was also counting down the end of my elite career. There are elements of elite ironman training (high run mileage and risk of immuno-destruction) that don't fit with my personal plan for the next 30 years. On reflection, I also wanted to experience the (hoax) joy of winning without having to cope with the extreme duress and health risks that come from elite level training.

To explain my current thinking, I need to set the stage with a couple of stories...

A -- I have a few good friends that are former military officers. I have always been drawn to "something" that all good officers share -- the calling to be an exemplar. Charlie Munger uses the term with respect to CEOs but it applies to any person in a position of leadership (teachers, parents, coaches...). An exemplar is a leader that consistently holds themselves to a higher standard than their students.

B -- Within my own athletic career, the highlights aren't the times that I won races. The real highlights came when I performed close to the level of a great athlete (Tom Evans, Steve Larsen, Peter Reid). Not so often with Peter and not any more with Tom & Steve... but I hope you get my point... it is extremely motivating to have the opportunity to race alongside athletes that played a role in our entering sport in the first place.

C -- The quickest way to learn that external success is an illusion is to "win". Even then, "victory" is a powerful drug and highly addictive. There are many ways to keep score. In athletics, we use a clock. In other fields, they may count mistresses, dollars, clients, page views, sales transactions... external success can become a trap.

A long introduction to say that I have decided to race elite for another year. Slowing down with style will make me a better man, at a minimum a more humble man!

Racing beside Simon Lessing, and the traveling Aussies, at Boulder Peak 2009 should provide me with a solid stress management opportunity. As well, there are athletes out there that will enjoy taking me down. Why deny them that pleasure? Scott jokes that our Epic Camp clients enjoy taking down "the Ultraman".

Outside of Worlds, I'm not quite slow enough to make it a fair fight in the agegroup ranks (it could get a lot more fair during an up-coming break). In business, I have tried to be willing to sacrifice success to remain true to my values. So, you guys in the 40-44 next year will be safe from me... but I will be benchmarking against you. When you track me, remember that I have a 10 meter draft zone and, likely, had to swim alone, often without a wetsuit!

The Canadian federation makes it a bit challenging for non-resident nationals to receive their elite cards. As a result, I am going to seek a US Elite Card (once my Green Card comes through). To my friends north of the border, know that I love Canada and am a proud Canuck.

Next week, I will publish Part Two. That letter will cover the intersection of Business, Athletics and my Personal Plan. I have things sorted for my 40s but have discovered a few areas that need to be addressed to prepare for my 50s and 60s.

I play a long game.
gordo

Add It Up

Our photo this week is Team Bennett (Greg & Laura).

As I type this, Laura is heading to Beijing in order to represent the US in the Olympics (pretty cool). I have been fortunate to get to know the Bennetts over the last little while.

When I compare Laura to myself, what stands out is her true attitude. By "true attitude" I mean the way she is. She is not working on having a positive attitude -- she "is" positive in a very peaceful sense.

Over the last eight years, I have made a consistent, conscious effort to reprogram a habit of relentless positivity. I also work on seeking to view situations from the opposite perspective. My attitude is a habit, Laura's attitude is a trait. Give me another 20 years and I might get there!

When I was working with Dave Scott in 2004, I was amazed at his grasp of the competitive dynamic of Ironman racing. Dave's toughness and physical skills are legendary but, I think, what really gave him an edge was understanding the competitive dynamic of a race and knowing how to "win".

The only person that I've met with a similar level understanding of mixing terrain, skills and tactics is Greg Bennett (the other "GB"). Seeing as I am an older, long course guy... (i.e. no threat!) ...Greg speaks freely around me. Like listening to Molina, I kick back and soak up the knowledge. Every single time I sit down with Greg, I learn something new. What's unique to Greg is his capacity to create, then execute, a winning strategy. There are a lot of strategic coaches out there but they rarely have the physical goods to deliver their own plans. He's formulating, visualizing, then executing his own victories.

With a bit of luck, we will be able to schedule the Bennetts as part of our evening speakers series at our Boulder Camp next July.

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Toby (from Art of Tri) has offered a 20% discount to all gBlog readers. What you do is enter the discount code at check-out. The code is GORDO-99 and the website is HERE. Monica and I like the hoodies.

One of Art of Tri's taglines is "One Passion...Endless Training". That can mean a lot of different things. Five years ago, I might have interpreted that as making sure that I met my daily target of Five-A-Day.

Five hours of training, rather than five servings of fruits and veggies!

More and more, "Endless Training" is about maximizing my athletic enjoyment across a lifetime. Taking care of my body and making sure that I'm still able to do interesting things into my 60s and 70s.

The first time I rode up the Tourmalet (pictured below), there were two guys well into their 60s (perhaps 70s) grinding their way towards the summit. Totally soaked in sweat -- suffering in silence. Frankly, they looked a lot like Montgomery, Newsom and me -- just older!

I want to be those guys. I want to be on the Tourmalet in 2030 (hopefully with Molina.


Endless Training.

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Add It Up
Most of the discussion about endurance sports is prescriptive in nature. Athletes create goals and ask friends/experts/coaches to comment on what-it-takes. Coaches opine about optimal protocols required for "success". Success being defined in terms of beating all-comers, personal bests or qualifying for World Champs.

Rarely do we invert the question.

Instead of stating "What it takes", I start by asking my clients "What have you got?"

In order to figure that out you need to Add It Up and I like a time inventory/log to get a hold on that. Consider in a week, time spent...

Training
Working
Shopping
Cooking
Cleaning
Spouse
Friends
Kids
Pets
Family
Education
Reading
Personal Admin
House Maintenance
Internet
TV
Movies
Relaxation
Other...

Don't waste time scheduling your perfect week -- rather, observe, and log, what you are really doing. You will learn a lot.

There are no sacrifices required for success, merely choices. Most people will resist the above exercise because they don't want to be faced with the information that would result.

One of the choices I make is to sub-contract as many non-core items as possible. Paradoxically, I also retain a number of items that might appear to be low value added:

***Cooking red meat
***Trash, recycling and pet poop
***(Moderately) heavy lifting -- I need assistance for the truly heavy
***Rose garden watering
***Breakfast

I could probably sub-contract these items but I find them relaxing and happen to be very good with pet poop.

My point is we can only "create time" by reducing our commitments. In my podcast with Chris McDonald, his advice to the aspiring athlete was "sell everything". Extreme simplicity is another way to reduce commitments -- if you don't have a house, car, consulting practice, spouse, job, garden, pet... then there is nothing to spend time on. Remember that elimination of many of these items will have a negative impact on our ability to have a life with meaning.

OK... once you've added-it-up. Reflect on the following levels of endurance commitment...

Nine hours of training per week -- at this level, you will be able to achieve personal health and enjoy the wellbeing that comes from endorphin release. Remember that the greatest benefit you receive from an active lifestyle comes from the first hour in your daily routine. At this level, you are unlikely to maximize your potential as an "athlete" and a lot of people are curious about how far they can go.

Fifteen hours of training per week -- at this level of long term commitment, you have a very good shot at achieving the bulk of your athletic potential. I think that it represents an achievable target for an athlete that wants to make endurance sport a fundamental aspect of their life.

Now the kicker... endurance sport attracts a lot of extreme people, such as myself. After a taste of early success... we convince ourselves that "achieving the bulk of our personal potential" is selling ourselves short. So we target...

Twenty-One hours of training per week -- if you want to squeeze the last few percentages (and we are talking small percentages) from your performance then you're looking at a 1,000 hour annual commitment for an extended period of your athletic development.

Thing is... even if you can handle it physically (many can't)... as you shift ever upward on the endurance commitment scale... you will notice that, eventually, you also need to annually commit an extra 700 hours of sleep and spend an extra 350 hours on athletic admin (massage, stretching, changing, showering, travel).

For many, what was once an enjoyable 450 hour annual commitment, gradually becomes an all-encompassing obsession sucking upwards of 2,000 hours a year.

So in addition to adding up your available time, also consider what level of athletic commitment makes the most sense in terms of the life that you are seeking to create for yourself.

Financially...
Ten years
1,550 hours per year
$15 per hour (say, $25 less 40% in taxes/costs)
5% return on savings
= $292,000

Sit on that nest egg for 20 years at 5%
= $775,000

Choose wisely,
gordo