A good analogy is to look at your body like a living calorie bank and caloric energy like money. You store calories in your body the way you store money in a bank. You can make energy deposits and withdrawals from your body the way you would make money deposits and withdrawals from the bank, depending on how high your energy costs are.
When your energy costs are equal to the calories you consume, then all the calories you consume are burned immediately and no deposit or withdrawal of calories takes place - your balance stays the same. When your energy costs are greater than the number of calories ingested, you will make an energy "withdrawal" from your calorie bank and your body fat "balance" will decrease. When your energy costs are less than the amount of calories you ingest, then you will make an energy "deposit" and your body fat "balance" will increase (excess calories go into fat storage).
The exception to this rule is when you are on a high-intensity weight training program to gain lean body weight. In this case, a small part of the calorie surplus is directed into muscle growth. Even when you're training hard, if the calorie surplus is too large, the excess beyond what is needed for muscle growth will go straight into fat storage.
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Metabolism. There isn’t perhaps a more frequently used word in the weight loss (and weight gain) vocabulary than this. Indeed, it’s not uncommon to overhear people talking about their struggles or triumphs over the holiday bulge or love handles in terms of whether their metabolism is working, or not.