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Investment Macros

Investment Macros

Episode 003: The Macronutrients of Investing

Synopsis In this episode, Jared introduces one of the most foundational concepts of the "Everything is Investing" philosophy: The Investment Macros.

Drawing a direct parallel between performance nutrition and life management, Jared breaks down our three primary currencies—Time, Energy, and Money—and likens them to Protein, Carbohydrates, and Fat.

You will learn the unique properties of each resource, why Time is the "great equalizer," and how to identify if you are using a "one-size-fits-all" approach that is sabotaging your returns in marriage, fitness, or career. This episode concludes with a macro audit to help you align your actual behavior with your stated priorities.

Detailed Outline

I. The Nutrition Connection

  • (0:40) Why Food Matters to Investors: Jared introduces his "obsession" with nutrition and how it informs his view of resource allocation.
  • (2:42) The Hierarchy of Nutrition:
    • Quantity (Calories): Determines the size of your body.
    • Composition (Macros): Determines the shape of your body.
    • Quality (Micros): Determines the health of your body.
  • (4:02) Analogizing Currencies: Just as you need a balance of Carbs, Fat, and Protein to perform physically, you need the right mix of Time, Energy, and Money to realize returns in life.

II. The Parallel: Food Macros vs. Investing Macros

  • (6:01) Energy is your Carbohydrates:
    • Carbs are quick-access, high-intensity fuel. Similarly, Energy (Effort) is what powers "bursts" like hard conversations or all-night study sessions.
    • Storage Limits: Like glycogen in muscles, Energy cannot be stockpiled indefinitely. Unused energy eventually dissipates.
  • (8:54) Money is your Fat:
    • Fat is energy-dense and stores exceptionally well. Money is the only macro that can be saved in nearly limitless quantities for use in "lean times."
    • The Danger: Both fat and money are "delicious" and fun to consume, which can lead to trouble if you like them too much.
  • (11:01) Time is your Protein:
    • Protein is structural—the building block for repair and growth. Time is the macro required for any real healing or progress.
    • The Most Vital Macro: You can survive a while without carbs or fat, but if you run out of protein (or time), it’s "game over."
    • Consistency: Protein/Time must be consumed/invested with regularity; you cannot "save it up" to use later.

III. Unique Properties of the Investing Macros

  • (14:44) Money: The Quantifiable Variable
    • It is the easiest to track and benchmark.
    • Negative to Infinity: Money is unique because it is the only macro that can go below zero (debt) or grow to infinity (trillionaires).
    • Termites: Jared warns that "inflation" acts like termites eating away at stored money if it isn't invested properly.
  • (16:25) Energy: The Misunderstood Enhancer
    • Energy is the most variable macro in the short term.
    • The Multiplier Effect: Energy couples with the other two to create impact. Money + Energy is more impactful than Money alone. Time + Energy (at the gym) is more impactful than just "being" at the gym.
  • (19:46) Time: The Great Equalizer
    • Fixed and Finite: You cannot "pause" or "accelerate" time. It flows at a constant rate for everyone—from billionaires to the homeless.
    • The Spigot: Time is always being invested. If you aren't pointing the "hose" of time at a specific goal, you are pumping your most limited resource onto the ground.

IV. Interchangeability and Constraints

  • (24:39) The Limits of Substitution: While you can pay money to save time (e.g., hiring a plumber), these are not perfect trades.
  • (25:53) The Time Bottleneck: In Jared’s experience with groups, 70–80% of people identify Time as their primary constraint, regardless of how much money or energy they have.

V. The "Investment Lie": Stated vs. Actual Priorities

  • (28:51) Behavior Reveals Truth: If you say something is a priority but don't invest at least two of the three macros into it consistently, it isn't actually important to you.
  • (29:48) The Health Example: People "invest" in health with money (supplements, organic food) because it's the easiest to give, but they neglect Time and Energy—the "king and queen" of health.
  • (31:41) The Kids' Sports Example: Parents often claim sports aren't their top priority, yet their "investment flows" (weekends on the road, high discretionary spending, intense sideline energy) prove it is the most important thing in their lives.

VI. Recipe Failure: The One-Size-Fits-All Trap

  • (35:58) Macro Ratios in Relationships: A fancy dinner (Money + Time) is a bad investment if you bring zero Energy (looking at your phone).
  • (39:37) Financial Investing: You can spend infinite Time and Energy on analysis, but if you don't actually put Money to work, the investment is negated.
  • (41:47) The Busy Executive: Success in a career often comes from a specific ratio (High Money/Energy, Low Time). Executives fail when they try to apply that same "career recipe" to their families, where Time is the non-negotiable ingredient.
  • (46:50) No Direct Translation: Successful strategies in fitness do not automatically translate to marriage. You must figure out the specific "macro mix" each area of life requires.

VII. Practical Application: The Macro Audit

  • (49:32) Common Under-Investments: Personal health, meaningful relationships, college funds, and spiritual/mental health.
  • (50:23) Common Over-Investments: * Digital Consumption: (Social media/streaming).
    • "Toys": (Cars, gadgets, fashion).
    • Politics/News: Excessive mindshare on things outside your control.
    • Productivity Hacking: "Over-optimizing" rather than just doing the thing.
    • Unhealthy Conflict: Over-investing in "saying yes" for the wrong reasons.

VIII. Closing Thoughts

  • (52:09) Final Encouragement: Don't listen to your first answer about what is important. Track your macros and believe the data.
  • (52:33) The Success Formula: Every meaningful outcome requires the right mix of all three. Bad outcomes are almost always the result of under-investing or misallocating one of the three macros.

Notable Quotes

"Time is the great equalizer. As long as we remain alive, we have the same 24 hours in a day that a billionaire does."
"If you say something is important to you, but you don't invest at least two of your macros into it consistently, you're not being honest with yourself."
"You cannot build anything meaningful with time but no effort. You can't solve every problem with money alone."
"The spigot of time is running at the same rate that cannot be slowed down or sped up. Not investing your time with purpose means you have a hose pumping out your most limited resource onto the ground."
"If our investing macros tell a different story than what we say, it is the investments that we should believe."
"Money is the least useful and least effective investment resource when it comes to your health. Time and effort are the king and queen of being healthy."
"A one-size-fits-all approach to resource allocation doesn't work. Success in your career doesn’t automatically translate to your marriage if you’re using the wrong macro recipe."
"Miracles in our lives are often just good investments that were given an appropriate amount of time to compound."

Next Episode: The wealthy versus poor mindset

003 - Investment Macros Full Transcript

(0:17) Good day investors. Welcome. I am Jared Bowers. I'm a portfolio manager for the wealthy, student of all things investing, teacher of "everything is investing," and very importantly, someone who eats a surprisingly large amount of food. And what does this have to do with investing? You may ask. Plenty, because we have something interesting to talk about today. I've mentioned before, but it's important to touch on again. We are defining and laying out the framework that is "everything is investing," the philosophy that underlies it all so that we have a good understanding of the what before we get deeper into the why and the how—this is what today and the next number of episodes are going to be focused on.

(1:21) And with that goal in mind, a very foundational concept is what I call the macronutrients of investing. I'm pretty sure that I'm not the first person to come up with this concept, but I know that I have a unique perspective and spin on this, and I have a lot to say. Surprise, surprise. And you will hear me reference this, these macronutrients of investing very often as we go forward from here, because as we know, and as we have established already, everything we do is an allocation of time, energy, and/or money, which is correctly described as an investment.

(2:02) And this fits really well into my own approach in life because I have admittedly a bit of an obsession when it comes to food and nutrition that may or may not become evident as we go forward from here. So I might as well just state it plainly. I love talking about money. I also love talking about fitness. I love talking about investing across all areas of life, but nutrition has a special place in my heart. And more specifically, in my belly. And the likelihood that some future episodes will be devoted to actual nutrition, food nutrition, is pretty close to certain.

(2:42) As a bit of a teaser to that, what I would love to talk about in one of those future food-focused episodes is this as it relates to food nutrition. The amount of food, as measured in calories, that we consume is the largest determinant of the size of our body. The composition of our food, as measured by the ratios of fat, carbohydrates, and protein, is the biggest factor in determining the shape of our body. And the quality of our food, as measured by the micronutrients and the realness of it, is the biggest factor in determining the health of our body. And there is definitely spillover of all those categories into each of the others with those cause and effect relationships, but more on that another time, if that sounds like an interesting topic to cover, maybe let me know.

(3:38) I haven't mentioned yet, but we do have a website with show notes and a contact page and some other resources. It's been in the podcast description, vestedjb.com. It's going to be built out more over time. So feel free to send feedback or send it directly to me if you already know me. Now back to investing and food. Let's talk about macronutrients related to both food and investing. And we're going to analogize our investing resources to food for the sake of understanding, for the sake of remembering, so that we can hopefully understand and then apply our investing resources better.

(4:22) And the three resources, those three currencies, if you will, of time, energy, and money are our focus today. Those are the macronutrients of investing. You've heard this before from me, and now we are going to look at how these resources work together. We're going to look at their unique properties, and we're going to talk about how we can invest them better. And to set the stage for that, let's again, talk about the macronutrients as it relates to food. Those are carbohydrates, fat, and protein.

(4:55) These three macros, we should all probably be at least somewhat familiar with. Even if we aren't nutritionists, even if you're not as interested and focused on performance nutrition as I am, we are probably all familiar with the macros that we eat on some level. Each of them has its own properties, its own best uses, and its own pros and cons. And just like you need all three macros of carbs, fat, and protein to function optimally in life, to perform well, to feel good, you need all three macros of investing—time, energy, and money—to get returns, to realize the results that you're shooting for, to make progress in the outcomes that you care about.

(5:36) And since we're on the topic of food macros that we consume, I'm going to at least briefly go through how the macronutrients of investing are related to and compared and contrasted with the macronutrients that we eat. I think that there are very similar properties and direct comparisons between them, specifically between each of them. They each have a parallel. So first let's look at energy. Energy, and I oftentimes refer to energy as effort in the investing equation, I think energy is best and most accurately related to carbohydrates.

(6:11) Carbs are the quick access, quickly usable fuel source that our body uses for bursts of energy and long sustained bouts of energy as well. Carbs burn hot and fast. They power movement. They are what your body turns to when something requires intensity or a long and drawn out endurance effort. They are what we primarily use when we run up a long hill or we have a long lifting session or we hike all day or we are performing in a high intensity sport. That is how energy and effort relates to carbs. When you use it, you see and feel its effects immediately, but it is variable.

(6:53) It depends heavily on your capacity on a given day, on a given week. And it's important to note that energy, just like carbs, cannot be stockpiled indefinitely. You can replenish it and our energy reservoir can be filled up, but it can only get so full. Unused energy eventually dissipates and is wasted once our reserves are filled. That is similar to how carbs are used and stored inside of our body. Our blood, our muscle, our liver can only store a certain amount of carbs for that quick access to energy.

(7:32) You store some. You may be familiar that muscle glycogen gets depleted and replenished throughout our day, depending on how quickly we expend and replenish that energy through activity and through food consumption, but that type of energy, those carbohydrates are not something that can be stored up indefinitely and then deployed far into the future. If you don't use it at some point, you start to lose it. If we don't use it with some regularity, eventually it is wasted. Additional carbs consumed do not necessarily equal additional energy that we can tap into in the future, at least not quickly.

(8:10) If you're thinking a step ahead, you may know that excess carbs can and likely will be stored as fat in our body to be accessed in the future. But let's keep things simple. And when it comes to the investing macro of energy, our effort is what we use to push through that hard conversation, pull an all-nighter study session, dive deep into analysis, tackle projects and goals with intensity, but our reserves, our reservoir of that energy can be used up and is used up the more and the more intensely we tap into it. So that is where energy as an investing macro and carbohydrates as the food macro are paired, I believe are closely related.

(8:54) Now let's talk about the next one, a fun one, money, a very important investing macro, right? And I think that money is best likened to fat. Fat that we consume is the most energy dense macronutrient. It stores well, both inside and outside the body. And many people we know, maybe ourselves wish that it didn't store so well, at least inside the body, right? But that is one of its incredible benefits as well as its drawbacks. Money similar to fat is something that you can accumulate a lot of for use later. It can be saved up.

(9:34) It can be stored for a long time. And that capacity for storage is nearly limitless. Unlike energy that we just talked about, money doesn't typically have an expiration date. You don't have to use it or lose it. And that is a very important and a very powerful part of it. And similar to fat, money is easier to accumulate when conditions are good, in seasons of abundance. And you tap into it, into your stores, into your savings when it is needed, during lean times.

(10:06) And when it comes to food, when you are in a calorie deficit, either intentionally or because you just don't have enough to eat, the same is true with money. If your income disappears, you'll be okay if you have enough reserves, if you have enough stored up. And you may have thought of this already, comparing money with fat. But here's another parallel. Both are pretty darn delicious. Both are pretty darn fun, fat and money. At least when it comes to using them, consuming them. And that also means that both can cause issues if we like them too much. Their deliciousness can get us in trouble sometimes.

(10:47) But instead of getting more into that, let's talk about the third one. The last one. Time. And if you're keeping track, you know that we only have one macro of food remaining to compare it to. Our third investment macro of time is best likened to protein. Protein is the structural macro. Think of it as the building block. Protein repairs, it builds, it supports growth, and it is foundational for long-term health.

(11:20) You see, when it comes to food, our need for fat and carbs can vary pretty widely. And you can do just fine on a high-fat diet or a high-carb diet. Or similarly, a low-fat diet or a low-carb diet. Probably not both at the same time. One of them needs to be high when the other one is low, or low when the other is high, unless you are an endurance athlete where you might be able to do well on a high-everything diet. But depending on what your specific needs are and how you structure it, our ability to flex from a dietary standpoint between fat and carbs is pretty significant, and it's a really great ability that we have.

(12:02) But our need for protein is pretty constant and pretty consistent because we can't build or grow or repair without it. And hopefully you can see how this parallel with our investing macro of time fits. It is, I would make the case, the most important macro on both sides, food and investing. And when it comes to time and protein, it's pretty hard to have too much of them. Of course, I would say that with my focus on protein, but I do think that it's true. Real growth of anything that we are investing in requires time.

(12:39) Repair and healing require time. You need to invest it pretty consistently for good results and especially for the best results in pretty much anything that we are looking to invest in. And another thing about protein is that it's very hard to store inside the body. You can't really save it up to be used later. And with fat and to an extent with carbs, you can have a reserve of them inside the body. You can pull from those stores, at least for a period of time.

(13:09) But if you're low on protein, there's only one place inside the body that protein is stored if it's not already in your stomach. And that storage depot is muscle. And if you need to pull from muscle to get what you need, because you don't have enough protein in your diet, that is not something that you want to be doing. Which is why protein needs to be consumed in pretty consistent quantities with pretty consistent regularity for the best results. And our time needs to be invested and used with consistency and regularity toward the things that we care about if we want to make progress and generate returns.

(13:46) And if we don't want the things that we care about and are investing in to fall off the rails. And because of that, time, just like protein, I believe is the most important one. It doesn't diminish the importance of the other two, but if you remove time from the equation, it is very hard to have good outcomes. Just like if you remove protein from the diet. And to consider that, if you think of the ultimate removal of time from the equation, that's the end of the road. That's game over.

(14:17) You can live for a period of time without fat and without carbohydrates, just like you can live in a state of low energy or low money. But if you have no time, if time is up, there's no coming back from that. I think you know what I mean. Best case is a coma. Worst case is there's no waking up. Now from here, I would like to talk in a bit more detail about each one of the investment macros in terms of their unique features.

(14:44) I've touched on some of these with parallels to food macros, but I think it's important to talk through their unique traits more specifically. And I want to start with money. I think that in many ways, money is the easiest to understand. Interestingly, when it comes to our investing macros, money is often either the most abundant or the most scarce, depending on your situation, depending on the phase of life that you're in, and depending on how well you've invested it up to this point.

(15:15) Money uniquely is very easily stored and can be stored indefinitely in infinite quantities, and it stores pretty well. Money does have termites that eat at it. Those termites are called inflation if you don't have it invested appropriately, something that we will dig more into another time. And as we've mentioned, money is also, when it comes to its unique properties, the easiest to track. It's the easiest to measure, and it's the easiest to benchmark. I'm looking forward to getting much deeper into tracking, measuring, and benchmarking in a specific episode in the future.

(15:54) And another very unique property of money, distinct from the other two, time and energy, is that money is the only one that can go negative. You can actually go below zero with money. And on the flip side of that, the positive side, money is the only investing macro that can go to infinity. There is no cap. At least it hasn't been found yet. And this is as we are in a world where we may have trillionaires living among us in the not-too-distant future.

(16:25) Now, let's talk about energy, or effort, and the unique properties of that. Energy is the most variable. Whereas the amount of money that you have on a given day is probably similar to the day before and the day after, and how much time you have on a given day is always constant, it doesn't change, energy on a day-to-day basis can vary a lot. It's probably the most variable in the short term, especially compared to time and money, which tend to be more stable in the near term.

(16:57) And energy is renewable, but it's limited on a daily and weekly basis. We can store it up to an extent, but as we talked about when it comes to food macros and its similarity to carbs, energy can only be stored up to a certain extent. Because if it isn't used, it will be wasted at some point. Because we can't just keep piling in more and more energy reserves, energy stores. We have a limited capacity. And energy is not completely fixed, like time is, because our capacity for it can be increased.

(17:33) And if you practice increasing your capacity for energy, you can increase that storage tank, that reservoir, and you do that by filling it up all the way and then depleting it most of the way, consistently, and ideally expending that energy towards useful, desired investments that we want to make. But it can't be increased to the same extent that money can be. Energy also is harder to measure. Time is pretty easy to measure, on the clock. Most of us wear measuring devices or have a measuring device for time in our pockets.

(18:08) Money is very easy to measure, in an account, on a spreadsheet. But energy and effort are much harder to quantify and to track. And I believe that energy is probably the most misunderstood investment macro. Because it isn't the same as time, which oftentimes people conflate energy and time. Time you can spend without spending effort. And you can spend effort pretty intensely in a very short period of time.

(18:36) And this brings us to another, more unique trait of energy. I think that energy is much more of an enhancer of the other two macros than the other two macros are enhancers of the other. What I mean is that money plus energy is a lot more impactful than money by itself, or even money plus time. Similarly, time plus energy is much more impactful than just time invested by itself. If you're trying to do something like build with your hands, or invest in the market, or start a business, money only gets you results to the extent that it is coupled with effective strategy, which requires energy, effort.

(19:18) And time plus energy is a lot more impactful than time by itself. Think about when you go to the gym. We'll talk about this a bit more later, but it doesn't matter if you spend two hours there. If the effort that you put in is negligible, that's really just a waste of time without also investing energy. So the idea of energy as an enhancer of the other two, I think makes it a little bit more unique, more specific to the investment macro of energy.

(19:46) Now, next, in terms of unique properties, let's talk about time. When it comes to time, many people feel like they're short on it and they need more of it. They feel like they're lacking. Time is very unique because it's fixed, it's finite, and it cannot be saved up even just a little bit. And you can't push the pause button on time like you can on money, or even on energy to an extent. Also, time cannot be accelerated. It is coming at a constant rate.

(20:18) It's flowing at a constant rate, which means that it is being invested at a constant rate. With money, you can increase and decrease the amount and the rate of investment that you're putting into it. With energy, that's very similar. There's a throttle on that. Time does not have a throttle. It's being invested at the same rate every second of every day, no matter what. And because of that, another unique thing about time is that it is the great equalizer, at least on a day-to-day basis.

(20:48) Some of us will have more years than others, but when it comes to our days, everyone has the exact same amount of time in it. And I've already let out that I believe time, like protein, is the most important macro. And that means that we are all playing on a mostly equal playing field when it comes to the most important investment resource that we have, time. Many of us are tempted to notice our lack compared to others, but as long as we remain alive, we have the same 24 hours in a day that a billionaire does.

(21:21) I think that's an important thing to keep in mind. Time is also quite measurable, like money is. As I said before, most of us have, in our pockets or on our wrists, measuring devices of time. So even though it's measurable like money is, I think that more people measure money and budget money than they do measure and budget time. Yeah, I think far fewer people track, measure, budget, benchmark their time than they do their money. And not that many people consistently track their money, which means that very few people consistently track, measure, and benchmark their time.

(22:00) That may be why so many of us feel like we're not getting the outcomes we want, or we feel short on it. Something to consider. And I've touched on this already, but it's important to really make clear. I believe that the most unique property of time, what makes it truly unique is that it is always being invested. And if not invested, then spent, wasted. But it is always flowing out. No matter what, the spigot of time is running at the same rate that cannot be slowed down or sped up.

(22:35) And realizing this and understanding it and taking it to heart is key. Not spending or investing your time with purpose means that you have a hose that is pumping out your most limited resource onto the ground or into something that it shouldn't be. We need to point that investment somewhere. We need to direct it somewhere. Connect that hose to where we want our time invested into. Otherwise, it is wasted.

(23:04) And on the topic of time, as it relates to money, it is very difficult to get good long term results, which all of us are shooting for in our money without the thing that underlies long term, which is time. Time invested consistently for a long time. Incredible, miraculous things, seemingly miraculous things, can be accomplished with good investing over a long period of time. And that is not just with money, but it is also certainly with money.

(23:38) And the reverse is also true. Even with good allocation of other resources, money and energy, rushing those investments, trying to get something quick, can often result in returns that we didn't expect or that we didn't want. Time can turn things into miracles or disasters, depending on how well and in what direction we are investing. And when we look at what may seem like miracles in our lives or in the people's lives around us, oftentimes the most important ingredient to those miracles was time.

(24:11) And we should not be in a hurry to rush important investments. Most of the important investments that we make in our lives require the proper amount of time. And many of the things that can properly be called miracles in our lives, as I said, were the result of good investments over a long period of time, or at least an appropriate period of time. All right, we talked about their unique properties. Now let's talk about their interchangeability.

(24:39) This may be obvious, but there is at least some interchangeability between all of the investing macros. Meaning that you can save time by investing more money and energy. There are ways that you can save money by investing more time and energy. You can save energy by investing more time and money. But none of these exchanges are perfect trades, at least not in most cases. And for every case where there appears to be a close substitute, there are multiple cases where a substitution is more challenging or just doesn't work.

(25:15) And if this were not the case, some but limited substitutability, you would see that people with an abundant amount of one of the macros, time, energy, or money, would have most of their problems solved because they could just substitute the resource they're short on for the one that they have a lot of. But that's not the case. At least I've not come across that. Because when I sit across from people, groups of people, and I've done this many times, to the tune of hundreds of people now, I ask them to consider what they're most limited on, what they feel most constrained by.

(25:53) Do they feel most constrained by energy? They don't have enough of it. Do they feel more constrained by money and how much of that they have or don't have? Or do they feel more constrained by time? And I have people raise their hands. I just did this exercise with a group of people. And in that group of people, which was about a dozen, when I asked if it was energy that was the constraint, nobody raised their hand.

(26:21) When I asked if money felt like the biggest constraint, about four, maybe five people raised their hand. And when I asked if time felt like the biggest constraint, that is where the majority of hands went up. And that is consistent across groups that I've talked to, big and small. If the group is large enough, a few people will typically raise their hand when I ask about energy.

(26:44) More people will start to raise their hand with money, but the vast majority, at least 60, usually closer to 70 or 80 percent, raise their hand when it comes to time. And oftentimes, some of those people raising their hands have abundant amounts of energy and money, sometimes ridiculous amounts of money, yet they still feel massively constrained by time. You know, I just realized maybe this is partly a comparison game problem.

(27:13) We can have more energy and money than other people, but time is a great equalizer, the great equalizer. That may be part of why we feel so short on it, because we can't have more of it than other people. Hmm, I'll have to think about that. Now, depending on the phase of life that you're in, depending on how well you've invested up to this point, where you've started from and where you're going to, what you feel most constrained by is very unique to you and your situation.

(27:44) And for me personally, it has changed many times over my life. There are different periods of time when energy has been the biggest constraint. There have also been periods where I felt like money was the biggest constraint. But even for me, consistently, and I would say this is true right now, my biggest constraint is time. And so as I'm talking about investing in life, this just highlights why, yes, money is important when it comes to investing.

(28:13) But if I was to only focus what I talk about on investing related to money, when I have proven with the groups that I've talked to, and you probably feel similarly in your own life, that more often than energy and money, time is our biggest constraint, it would be silly for me to just focus our discussions on money and not talk about the other two, maybe even talk more about the other two. But really, most importantly, all three.

(28:45) Now let's move on to our next topic of discussion as it relates to our investing macros. How we invest each of these three, time, energy, and money, reveals what is truly important to us. Where you invest these three valuable and limited resources reveal what is important to you. And if you say something is important to you, but you don't invest at least two of your investing macronutrients into it consistently, I think that you're not being honest with yourself.

(29:15) The best that you can say in that situation is that you want it to be important to you. But if it was truly important to you, you would be investing in it with multiple of your resources consistently and meaningfully, at least two. And for those truly important areas, all three macros. And I think a good example to talk through that with is health. Because of my fitness pursuits and the way that I look, I end up having a lot of conversations about health, nutrition, fitness.

(29:48) I've already talked about how I love talking about those things. So that's great. When we talk in real life, and it's not just me yapping at you, let's talk about it. And a lot of people claim that their health is a priority to them, but their investments reveal otherwise. If they're investing in it, it's often with money when it comes to health. At least that's what I see pretty frequently from people trying to convince themselves that health is important to them and they're investing in it.

(30:18) And how do you invest in your health with money? Well, you buy things. Supplements, shopping at the health food store, organic non-GMO ingredients, those things that make people feel good. They think that they're doing something, that they're making an investment. But money is the least useful and least effective investment resource when it comes to your health.

(30:41) Yes, it's true that wealthy people tend to have better health outcomes overall, but it is not because they're throwing a bunch of money at it. And those health outcomes are not out of reach of most people, which tells me that it is not money that is the issue. It is time and effort that are the king and queen of being healthy. And so many of us try to substitute the least effective macro, in this case money, for our lack of investing the most important and the most effective macros when it comes to our health, time and energy.

(31:16) And now let's talk about the flip side. Because we just talked about if you don't invest at least two of your macros into it consistently, is it really important to you? The reverse is also true. If you say something is not important to you, but you are investing at least two of your investing macros into it consistently, you may have to re-evaluate whether that is actually true and whether you are being honest with yourself.

(31:41) And the example that comes to mind here for me is related to sports. Specifically, kids' sports. Even more specifically, parents of kids who are constantly investing heavily in their kids' sports to the extent that pretty much all that they do with their free time is that, their kids' sports and related activities. By the way, nobody ever thinks that it's them, even the ones that are clearly in this category.

(32:08) Because I sit down with a lot of people, my clients, the people that I help, the people that I rub shoulders with, that I serve next to, many of my friends, some of whom my own kids are in sports with, and when I talk to these parents about what is important in their lives, what they really care about, because I like having conversations like that, their kids' sports rarely come up. But for some of them, they're spending nearly every evening and every weekend on the road, at tournaments, going to and from practices.

(32:42) An incredible amount of time allocation, to be sure. And if you look at their budget, it's not cheap, and their discretionary spending would reveal that a very high percentage goes toward their kids' sports activities, which, of course, represents a very clear investment of money. And now which one are we missing? Energy. We haven't talked about that one.

(33:05) If you look at how they respond to what is happening on the field with their energy, with their enthusiasm from the sidelines, they are clearly allocating a lot of energy to that as well. And this suggests, proves, I would argue, that their investment in their kids' sports is the most important thing in their lives. Hands down. There is nothing else that even comes close. And yet, these people do not want to admit that.

(33:34) Because maybe that sounds kind of silly as the number one most important thing in their lives. And to be fair, I think that many honestly don't even realize it. And that is why we shouldn't just listen to ourselves when it comes to what is important to us. We need to listen to our actual investments. How are we investing our macros? That reveals the truth.

(34:01) Because from my perspective, the kids' sports example, and that being the most important thing in their lives based on tracking their investment flows, is a little bit ridiculous. No judgment if people want to spend their time and money and energy that way. Okay, a little bit of judgment to be fair, considering the incredible menu of options they could and probably should be investing in.

(34:27) But again, as I said in our opening episode, I am not here to tell you specifically what to invest in. But that doesn't mean that I can't pass judgment sometimes. And this ties into what we talked about in our last episode, the mindshare concept. What we dwell on, what our mind drifts to, when we don't have something else that we are actively working on or thinking about, is probably what we value.

(35:01) And our allocation of the three investment macros, where we actually invest them in our lives, is very similar to that. And I think that it is even more revealing and more accurate. How we spend and invest our time, energy, and money reveals what is really important to us, with accuracy. And how we do not spend those resources reveals what is really not important to us, at least not yet. And if we want to make real progress, we want to get better at investing all three.

(35:27) Because good luck building a successful relationship without investing all three, time, energy, and money. Good luck building a successful career or a business without investing all three. Good luck raising kids without investing all three, whether you want to or not in many cases. Good luck getting healthy and fit without investing all three. What we focus our investment resources on is not just what we care about. It's also what we will be making progress in, whether we get returns at all.

(35:58) Going back to interchangeability and our investment focus, our allocation of these resources, let's talk through a couple examples. And I think that an example that encapsulates this well is going out to dinner with your significant other, your romantic interest, your spouse. Imagine sitting in a fancy restaurant because you want to show that you care, that you value the relationship with your money. So a nice restaurant and a full evening set aside.

(36:28) Heavy investment of time as well, right? Fancy restaurant equals money. A full evening is invested time. That will show how much I care. But then consider this. Leave energy out of the equation, out of the investment. Imagine that. No deep conversation. No invested focus. No effort put into connection. No engagement or truly listening to what they're saying. Maybe even looking at your phone the entire time.

(36:59) I've seen that. You've probably seen that too, even in fancy places. A couple sitting at a table, each just looking at their phone. Or even worse, just one of them looking at their phone. Actually, I don't know which one is worse. Regardless, in that scenario, there is no amount of time and money that you can invest in that dinner that will result in a good outcome if energy, if effort is not put into it.

(37:27) If there's no focus on the other person. And really, I would say that it probably makes it worse in that case. If you invested a bunch of time, an entire evening, and a bunch of money in a fancy place, but then invested no effort. You'd probably have been better off if you'd just gone to McDonald's. Because then it wouldn't feel like it was a complete waste of the other two resources that were being invested.

(37:52) In this example, and I believe it's true in other areas of life, a high level of investment of the two less effective resources is actually made into a bad thing by the lack of investment of the important one. In this case, time and money invested without energy. Let's look at another example as it relates to energy that I hope is instructive. Let's talk about going to the gym, one of my favorite places.

(38:19) And that is another place where time and money don't matter much if you don't invest energy into it. And in many cases, when it comes to fitness, there is a direct tradeoff between time and energy. You can run lots of miles at low intensity, which would be high time, low energy or moderate energy, more fairly. Or you can run a few miles at very high intensity to save time.

(38:44) That would be low time invested, but very high energy output. The same can be done with a weightlifting workout. It can take a long time at low intensity or a short amount of time at high intensity. And when it comes to money in the gym, you can enhance your outcomes of fitness to an extent by investing money into it. A nicer gym membership, gym equipment that you have access to at home.

(39:10) My home gym is a great example of that. It saves me gobs of time, but it came at a monetary cost. But I see it as a worthwhile investment. But similar to the eating out analogy that we talked about, energy is always the key ingredient when it comes to fitness. It doesn't matter how much time and money you've invested if energy is not going into it. Do not tell me that you worked out for two hours if all you did was wander around the gym for most of it.

(39:37) Now let's talk about an example where investing without money is just not going to work. And the best example of that is literally investing with money, financial investing, because you can spend all the time and energy you want to that you have figuring out what company to invest in, what funds to purchase, where the best place is to put money to work.

(40:02) But if you don't actually put any of that money to work, it doesn't matter how much time and energy you put into it. Or even if you made a good investment decision with your analysis, what conclusion you came to. It doesn't matter if you were exactly right if money is then not put into it in a meaningful way. All of that time and energy was then wasted.

(40:25) It was pointless. Or at least it was diminished by your lack of money investing if you only put a little bit of it to work. Again, this is an example of the investment of the other two macros, time and energy, which are important in the process but are completely negated if the most important macro is not actually put to work. My clients do not care if I spend all my time and energy identifying the perfect investment if I do not actually put money to work.

(40:56) That, I think similar to the date analogy we talked through, it probably makes it worse than if I had not identified that excellent investment in the first place. Let's now talk about an example where time is the most important ingredient. And I would say that a good example of that to talk through is with investing with family, investing in family, relationship building.

(41:20) You can spend a lot of money on your family and you can try to speed run quality time by putting a lot of energy into it in a short period of time. We've probably seen those situations. Maybe we have been those situations on one side or the other. And it does not work well. The stereotypical example of this is the busy executive who will try to use money and a blast of quick energy to try to make up for a lack of quality time spent.

(41:47) And hey, nice try dude, but that is not going to work. And why does he do that? Why do we do that sometimes? And I guess I realize I'm stereotyping this busy executive as a man, but I think that's pretty common. Why do we do this in areas of our life? Why does this busy executive try to do that? We often try to get around investing the time we need by trying to make up for it with money and energy because time is often the hardest one to invest.

(42:17) It's the one most of us feel shortest on after all. And I think it's also because of how we have been able to and have learned to save time in other areas of life by investing more money and more energy, at least in those areas where it's possible to do so. And those areas do exist. And in many of those areas, we can still get good investment results through our focused investment of money and energy in order to save time.

(42:44) For instance, you can absolutely save time in the gym by investing more money and energy, build a home gym, have really quick and really high intensity and efficient workouts. Great time saver. And you're still going to get good results. You can save time on all sorts of things simply by investing money in it, right? With food, yard work, laundry, flying versus driving, you can just pay other people to do things for you and save time, certain things at least.

(43:16) And often we get a taste of that investment success in one area where we can invest a couple macros or one macro more intensely to save the thing that we feel short on, that we feel is more limited. And then we think that we can apply that as a recipe to other areas. And admittedly, I am guilty of this sometimes, maybe many times myself.

(43:38) But trying to apply our investment process from our career or our hobbies or our chores to our relationships or to our health isn't necessarily the problem. It's the misunderstanding and then misallocation of which macros are the key ingredients that is the problem. We can convince ourselves and think that we can invest money and energy to get a good result when time is the key macro that is needed.

(44:06) Or we try to invest more energy and time when money is the thing that is most important to invest. I see this truth across other areas of life, investing heavily, but not getting the results because the key ingredient isn't being invested. Hello leaky faucet that we have worked on for hours when one call to the plumber and not a lot of money would have fixed and avoided all of those swear words.

(44:32) But back to the busy executive example, that busy guy, maybe it's you, it has been me before, is still me in bad weeks to be fair. He has achieved success in his career because he's found the proper allocation of resources. And he applies those investments consistently. That is the recipe that he can and should follow in his mind.

(44:54) So he applies that same mix of macros from his career to his family, invest money and invest energy to save time. But what is missing is the focus on identifying the proper resource to invest and not neglecting the most important one, that different areas of life require different allocation of resources. In this one, clearly, obviously, time.

(45:18) And not doing that, not understanding that the exact recipe that we apply to one area where we have success cannot directly be applied to another area that requires a different ratio, that is going to result in bad outcomes. And just like other examples that we've talked about before, the more intense and the higher the magnitude of investment of the less important ones without the investment of the proper one, the most important one, quality time with family in this case, is probably going to result in worse outcomes than a lower allocation of energy and money would have resulted in in the absence of time invested.

(45:57) Recall our dinner date example a little bit ago, that same situation, but with energy being the missing key ingredient. And an important lesson here is that a one size fits all approach to investing in resource allocation most of the time does not work. But we tend to try to apply our successful investing recipe in one area to another area without considering the unique macro needs of each one.

(46:21) And then we wonder why we don't get good results. Instead, an approach of proper resource allocation is what is needed and is what will get us better returns. We need to fight against the temptation or the trap of thinking that the one size fits all approach is the right way to go. That approach of I'm successful in my career and in many of the hobbies that I invest in by doing it this way, so that should work with everything else, right? No, not quite.

(46:50) Effective allocation in one area does not automatically equal effective allocation in another. Our successful strategy and fitness doesn't translate cleanly to career. Successful investment in our career doesn't cleanly translate to relationships. The proper allocation of our macros and parenting doesn't cleanly transfer to health. Money management discipline does not successfully translate directly into marriage, at least in terms of the effective ratio of macros needed.

(47:20) And just like whether how much you invest your macros reveals what is important to you, how well you are investing them in proper proportions is determinative of whether you get results or not. Ultimately, if the right mix of macros aren't being invested, you won't get returns, even with a massive investment of the other two of your resources. And it is up to us to figure out what those are and then invest them.

(47:47) Our macros of investing tie into every area that we will talk about. Every concept, every example, every conversation, every investing outcome that we're shooting for or have already achieved ties into how we allocate our time, energy, and money. And if you continue forward with me in this, and I sure hope you do, get ready to talk a lot about macros. And remember, if you say something is important to you, but you don't invest your resources into it, we need to be honest.

(48:18) The best we can say in that situation is that we want it to be important. And if we really want it to be important, we need to prioritize it with our macros. And if we say something is not important, but we invest a lot of time, money, or energy into it, then we also need to be honest. The best thing that we can say in that case is that we want it to not be important to us, that we want it to not be a priority.

(48:42) If our investing macros tell a different story, it is the investments that we should believe. The areas that I hear from people that are related to their investment of time, energy, and money are not unique. There are areas that we all want to invest in and want to invest in better. Marriage, parenting, career, health, friendships, faith, our hobbies.

(49:06) In keeping with our theme, if you have resources to invest, you are a portfolio manager. And you do have those resources, therefore you are a portfolio manager. So as portfolio managers, let's invest our resources well. So consider, are there areas that you say are important to you, but are not getting consistent investment of at least two of your three macros?

(49:32) And are there areas that you say are not important to you, but are getting consistent investment or heavy investment of at least two of your three investment macros? The common areas of underinvestment that I hear from people about are personal health, nutrition, fitness, recovery, meaningful relationships, marriage, kids, grandkids, finances, related to our savings, our retirement, college funds.

(50:01) Another is continuing education and personal development, hobbies that we want to pursue, non-professional pursuits for pleasure, for our own interest, and also spiritual health and mental health. And in my experience, those areas I just mentioned represent the main categories of underinvestment for most people. Not all of them, of course, but some of them.

(50:23) And then on the flip side, the common areas of overinvestment that I see are things like career and professional achievement. Some of us, at times, are overallocating our resources to those. Another one is digital consumption. This is a common one. Social media, streaming, YouTube, Instagram, TikTok. Another common one is toys, things like cars, gadgets, fashion. These are often recipients of overinvestment, even just from an attention standpoint.

(50:54) Some less common ones, but I think that many will relate, consider news, politics, conflict at the national or international stage. Applying too much mindshare, too much energy to that, too much time. For you podcast listeners, many of you will fall into this category. Over-optimizing, productivity hacking, looking for the best ways to do something rather than just doing the thing. That's a pretty common category of overinvestment.

(51:24) When it comes to relationships, some people overinvest in conflict, and some overinvest in unhealthy relationships. And then there are things that suck up our resources, like trying to avoid guilt, which is basically saying yes for the wrong reasons or not saying no enough. All of those are areas where we can overinvest.

(51:47) And bringing it back to food, just like a marathon runner probably should not be low-carb and try to accomplish their training or their race on fat and protein alone, and just like a bodybuilder shouldn't be on a high-fat, low-protein diet, different goals and different pursuits and different circumstances in life require different investments of all three resources that we have.

(52:09) So my encouragement to you is this. Do not try to get away with a one-size-fits-all approach. And use that macro audit that we just talked about to identify the areas where you may be overinvesting or underinvesting. And do not listen to your first answer, your response to the question, what is important to you? Track the macros and believe that.

(52:33) And remember, you cannot build anything meaningful with time but no effort. You can't solve every problem or even most problems with money alone. You can't have long-term growth without steady investment of time. Every good and meaningful outcome requires the right mix of all three. Bad investment outcomes can usually be traced back to one or more of the three investment macros being underinvested or misallocated, invested in the wrong things.

(53:03) Okay, I hope this laid out the importance of the foundational concept that is our investing macros. Thank you for investing in yourself and in those around you. I will talk to you next time. Is anyone else really hungry after all that talk of macros?

(53:31) [End of Transcript]