I think we can all agree that triathletes are generally exceptional people ;), but what is it about being a triathlete that makes your financial planning different from your non-triathlete counter-parts?  

There are a number of key differences Triathletes need to consider in their financial planning. 

In this article, I will explore several of the primary differences.

It’s amazing to consider how much work we put into the sport, and what a small number of us make a living doing it. The efforts to improve the odds at generating money in this field are getting more interesting every day, but the vast majority of us are paying out of pocket for the opportunity to challenge ourselves and push our limits. 

We need to be aware of the financial impacts of these decisions over time and make sure we are making knowledgeable decisions.  

So let’s discuss some of the key differences in financial planning for triathletes.

1) Financial Independence 

Image illustrating the increased anticipated longevity of a triathlete.

Financial Independence is fraught with complexities for the average person. According to a recent study, the average age of retirement is 61 and has been there for roughly a decade. According to world bank economic data, the average life expectancy for a US Citizen at birth in 2018 was 79.  

This results in a timeframe in retirement of approximately 18 years for the average person.

There have been many attempts to quantify the health benefits of exercise. A 2012 study by Steven Moore et. al referenced the benchmark of people who exercise 150 minutes each week and referenced them as “moderate” exercisers.  This study suggested that this recommended “moderate” level of exercise for a 40-year-old would result in an increased life expectancy of 3.4 – 4.5 years.

If you are active and of normal weight, this variance could go as high as 7.2 years of increased life expectancy.

One of the study scientists had commented in a subsequent article that the data pointed to increases in life expectancy beyond 150 minutes and a point of incremental benefits tapering off after 300 minutes (5 hours) per week.  

The average time a triathlete spends training starts at around 6 hours per week.  Some elite athletes regularly get to 20+ hours per week of training.  Obviously, these weekly numbers will vary based on your phase of training and the distances you are training for.   

I think it is safe to say that as a triathlete you should plan for an increased life expectancy.  3.4 years would be on the low end and a more conservative planning estimate would extend the normal by 7.2 years.  

If we assume that a triathlete and a non-triathlete would start retirement at the same time, this results in triathletes spending 18-38% more time in retirement than the average person.   

In addition to more time in retirement, it has also been studied and documented that endurance athletics has a strong link to deferring the impacts of cognitive decline by up to 10 years.  As triathletes, we have a higher likelihood of enjoying an active and engaged lifestyle for longer into our retirement.

Does this mean that as a triathlete, your nest egg needs to be 18-38% larger than your average counterpart?  

Perhaps, but maybe not.  

It depends on your goals and your resources. At a very minimum, you need to consider the impacts of increased longevity and incorporate that into your financial planning.  

2) Cash Reserve

A general starting point for cash reserves is 3-6 months of fixed and committed expenses. For triathletes, this metric could be sufficient, but we would need to be clear on what is included. Do you include your gym membership, coaching, additional nutrition, and race fees in the measurement of “fixed and committed” expenses?  Or are those expenses really “discretionary”? 

Depending on your view of triathlon and the role it plays in your life, your answer may be different.  You need to find the right answer for yourself.

You may want to keep an extra $800 in the “emergency fund” just in case you qualify for Kona at your next Iron Distance race.  Keep in mind, the ~$800 is only the race entry fee. You still need to travel there, get a hotel, etc.

We will discuss later another aspect of the cash reserve and your medical insurance “maximum out of pocket” expense.  Look forward to that in point #10.

Finally, you need to be in a position that if (knock on wood) your Tri bike was ever damaged or stolen, you could get a replacement. You might also take that opportunity to upgrade or just replace your trusty steed.   Either way, you should be able to acquire a ride in short order if something bad happened.  

3) Cash Flow

Being a triathlete can certainly put you in the “expensive hobby” category. Triathlon is a hobby on which you can spend a nearly unlimited amount of time, energy and money. Between a coach, gym membership, nutritional needs, gear, maintenance, race fees and travel, you can spend a lot of money on triathlon.  

With some thoughtful consideration, there are lots of ways to be a frugal triathlete which are great.  

Most triathletes I talk with are not aspiring to get out of the water and hop on a 20-year-old, steel frame road bike.  Wrestling with the downtube shifters to get going is typically not part of their goal.  

There are things you can do to make the sport more or less expensive, but it generally fits in the “expensive” category.  You should be planning according to your goals and preferred level of involvement with the sport.

You can check out my guide “Foundations for Financial Independence for Triathletes” for some helpful tips in this area.

4) Gear

As triathletes, we can spend an almost unlimited amount of money on gear. Triathlon could be considered gear intensive.

If some regular maintenance is done on that spiffy tri bike, it can extend the functional life of the bike by extending the usability of the drivetrain, etc.

Getting the new watch or the new wetsuit can also add up. We should plan for these expenses to the best extent possible.  

More than one holey wetsuit has been worn on race day.  One thing cyclists should absolutely replace periodically is the bicycle helmet. I am sure a lot of money spent on marketing new helmets. Getting the latest/greatest aerodynamic everything may not be appropriate for all of us, but replacing your helmet every 5-10 years is something we should be doing, even if it hasn’t been visibly damaged.

5) Race Fees

Most of us have one or two key races each year, the entry fees for these races can be significant.  

With Iron Distance race entry running ~ $800 this can be considered a significant expense. If you are an Iron Distance racer and want to race a “popular” race, it is also not uncommon that you may need to register for your race a year in advance.  

Iron Distance races aside, race fees can still be very expensive.  With Sprints starting at around $40, Olympics in the $60-$90 range, and Half Iron-Distance races as much as $400.  You don’t have to be a “long” distance triathlete to spend a lot of money on race entries. 

Most triathletes will also find themselves throwing in a series of running races, cycling events or some open water swims to mix it up during the year — which means race fees can quickly get out of hand if you let them.

6) Partner Balance and Bliss

The expenses of triathlon have the possibility of negatively impacting your household finances.  If you don’t take the time to talk about expectations periodically, it can create significant friction.  

There are several ways to mitigate this friction.  A few examples are:

  1. Let the non-racing partner pick from a few destinations for races and extend your travel into a family vacation. 
  2. Have set triathlon budget that will keep the overall expenses in check
  3. Turn your hobby into a moneymaker.  For example: write a blog about your triathlon journey and if you are able to monetize your blog, it could offset some of the expenses, or maybe coach a couple of athletes on the side to bring in some money to offset your expenses.

If you don’t do something to mitigate it, the finances of triathlon coupled with long hours training away from family can put a significant strain on your relationship

7) Guilt

The guilt that often accompanies an expensive hobby when we are pulled in many different directions also needs to be addressed. 

Competing priorities (pun intended) can lead to conflicts. We have already identified that you can spend a lot of money on a new bike, race entry fees, etc.  If you also want to save for your retirement, education funds for the kids, or a nice vacation for the family next year, your resources can get stretched thin.  It is easy to over-commit and need to make sacrifices.  

In order to combat this guilt and live confidently, it requires an understanding of what your priorities are and an understanding of what it takes to reach these goals.  

8) Life Insurance

No one likes to think about the harsh reality of being out on a road bike and the consequences of one thoughtless driver.  Unfortunately, the consequences are real. There have also been several cases in recent years of medical issues during racing.  

The chances of you being on the receiving end of a life-ending scenario are slim, but the possibility is real.  

If you have loved ones that are dependent upon you and you are no longer around, you need to make sure they are taken care of.  This requires having the right type of life insurance and the right amount. 

The easiest default strategy here is Term Life Insurance.  There are many reputable firms that are happy to take your premium dollars for as much of a death benefit as you like.  It is important to find the right amount of coverage for you and your loved ones.  If you are unsure of where to start, I suggest reaching out to your local fee-only financial planner to help you find out how much insurance you need. 

9) Property Casualty

Few expensive hobbies have a built-in risk of gear being stolen as triathlon does. Bike theft is a real issue and especially when you are talking about very expensive bikes, you may want to consider taking additional steps to insure your fancy steed.  

Many homeowners insurers will allow for a rider for specific assets. If you are concerned about the potential theft of your ride, you might want to talk to your homeowner’s insurer about making sure your bike is included in your coverage.

10) Medical Insurance

Medical Insurance is an important component for all of us, but it is especially important for triathletes. The biggest area of concern is on the bike and in particular, bike accidents.  If you trip on a run, you might end up with some scratches and some bruising.  A bike accident can result in a completely different set of issues.

Most of us know someone who has been in a serious bike accident.  

For many of us, the reality is that it is just a matter of time and severity of the accident we will be in. 

I sincerely hope none of the readers here ever experience a serious accident or have any permanent injuries. While there are a multitude of different things that could go wrong on a bike ride, accidents are rare and inevitable.  

Eventually, you are going to be involved in an accident of some sort and you need to be prepared for this.  

Most bicycle accidents result in a bit of road rash and a bruised ego, but sometimes things get worse. If you are involved in an accident and end up with more significant injuries, you could certainly need to lean on medical insurance.  

If you are involved in an accident with a vehicle, one would hope there would be some coverage available through the driver’s insurance, but we shouldn’t leave that up to chance.  

Maintaining your own medical insurance is critically important.  

I recommend that triathletes maintain Medical Insurance as well as an effective cash reserve to cover out-of-pocket costs. Ideally, your cash reserve would be at least twice the maximum out-of-pocket expenses related to your medical insurance.  

Depending on how long you have been a triathlete, you either have or will likely develop a need for some degree of medical intervention from a physical therapist, chiropractor, etc. The bills for this type of work can add up with or without insurance.  You might want to double-check your coverage and determine if this is a benefit you would like to have available to you. 

11) Education Planning

According to the USA Triathlon demographic study in 2016, the average triathlete is in their late 40’s and over half of them have an income in excess of $100,000. 

Over 80% have a 4-year degree or higher and nearly 70% of triathletes report being married.  

This is a recipe for high-income, intelligent people to be in a position to have children.  

Education planning is one of the most common concerns for most parents. If you are a high-income earner, your potential for need-based financial aid is significantly reduced.  

If you want to help your kids have the opportunity of a good college experience without wrecking your retirement, triathletes are going to need to pay more attention to this area than other parents.  

12) Estate Planning

As a triathlete, your estate plan needs to have addressed at least two primary areas.  

1) If you were to be in an accident or otherwise not able to make decisions for yourself, you should have someone appointed to make those decisions for you.  

2) If you were to pass away, there are going to be a multitude of other issues that are much more important than the one I am going to bring up that is specific to triathletes. That being said, it is something you might want to consider.

As a triathlete, it is likely you are going to have a significant amount of gear. Much of that gear could be very expensive. What would you want to have done with all of that gear, your bikes, etc.?  Would you like to have them donated to the local tri club, sold, kept in the family?

If these are of concern to you, you might want to have a conversation with your loved ones or document your wishes in your estate plan. 

13) Triathlete Mentality

I have listed several reasons Triathletes need to plan differently than their non-triathlete counterparts. There are also several concepts in financial planning that are uniquely suited to a triathlete’s mindset and general outlook. 

This makes triathletes uniquely capable candidates for understanding and solving some of these challenges.

A couple of examples here are:

1) The similarity of Training Stress Score (TSS) and Savings Rate  

As a triathlete, you know that you need to train enough to stress your body so you can adapt and get better. The right amount of training stress helps you reach your potential.  Savings Rate is very similar.  

If your savings rate is too low, you will never reach your full potential. If you start with a savings rate that is too high, you may become frustrated and stop. Increasing your savings rate gradually gives you an opportunity to work up to your potential rather than breaking a good habit before it really gets started.

2) Diversification as a triathlete comes as second nature. You have got to be involved with multiple things at any given time. Even if you are a great swimmer, you still have to bike and run on race day.  Swim, Bike, and Run has a lot of similarities to Cash, Stocks, and Bonds.

Charts comparing swim/bike/run to cash/stocks/bonds

As you can see, many of the themes are similar to what non-triathletes need to address in their financial planning, but triathletes have additional dimensions and focus areas that non-triathletes do not have to deal with. 

I hope you have found this valuable in your financial planning as a triathlete. If you have any questions or concerns about this, please feel free to email your questions to info@wallerfc.com.




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