Flybye - Here's a very easy to understand (though not at all comprehensive) description of the categories and how to "CAT up" (or move up in categories).
"What’s with the USCF category system?
The United States Cycling Federation has a 5 tier classification system to help balance out the ability levels of cyclists. Anyone new the sport gets their license as a Category 5 rider, regardless if they have the potential to ride like Lance Armstrong or an Average Joe. As you place towards the front of the pack at races, you accumulate points that lead to upgrades to higher categories. As an example, the upgrade from Cat 4 to Cat 3 requires 20 upgrade points in a 12 month period. First place in a road race or crit gets 7 points, so you need to basically dominate a category to upgrade. Cat 2 riders are national amateur level racers and Cat 1 are essentially pro level guys."
Source: http://www.northbranchcycling.org/modules/racing101/



For example, what makes one a cat5 rider vs a cat1 rider? Time trial speeds? Years riding? Distances covered? Were you all born just knowing this? Where was I when the instructions were handed out? Why didn't anyone come get me??
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