More Money Podcast - 016 Sex, Zombies and Compound Interest - Robert R. Brown, Author of Wealthing Like Rabbits

Episode Date: September 2, 2015

In this episode, I interview Wealthing Like Rabbits author Robert R. Brown about how he got into the personal finance world, what inspired him to write this cheeky book and what it means to wealth like a rabbit. Long episode description: It was so great to chat with Robert Brown in this episode, the author of the personal finance book Wealthing Like Rabbits (or it’s original title and my personal favourite, Sex, Zombies and Compound Interest). I was able to review the book on the blog back in November, so it was fun to be able to chat with Robert about some of my favourite passages and find out more about the man behind the book. As mentioned at the beginning of this episode, I will be giving away a copy ofWealthing Like Rabbits so you can enjoy it just as much as I did. Make sure to enter below! And as always, below are some interesting links that we mentioned during the show that you may want to check out as well. Personal Finance Authors Robert Mentioned David Chilton Bruce Sellery Gail Vaz-Oxlade Preet Banerjee Links I Mentioned My book review of Wealthing Like Rabbits My house hunting blog series Podcast episode 4 about travelling on an extreme budget with my friend Stephanie Williams Shownotes: jessicamoorhouse.com/16 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello, and welcome to episode 16 of Mo Money Mo Houses. I'm Jessica Morehouse, your host, and thank you so much for listening and putting me in your ear, or maybe there's some speakers around and you're cooking something. I am stoked to be at episode 16. I can't believe it's already been a couple months I've been doing this. It's insane. And I am stoked because my next guest is an author. So it's my first kind of non-blogger, you know, kind of guest. And his name is Robert Brown. He is the author of the personal finance book, Wealthing Like Rabbits. I've read it. I actually did a review of it, I guess, maybe a year ago or so. I can't remember. But I was trying to think of who would be a really fascinating guest for this show. And I,

of course, remembered his book. I looked through it before I interviewed him and I remembered every single story. It's very close to, in my mind, very similar to The Wealthy Barber and how it's written, kind of narrative style. So very excited to talk to Robert about his book and all of the topics he covers in his book. And because I've mentioned book like five times in this one sentence, I am, of course, going to be giving away a copy of Wealthing Like Rabbits. So make sure you listen to the entire episode or wait till the end or skip to the end, whatever you want to find out how you can enter this contest. And also you may want to stick around too, because I am going to be giving some iTunes shout outs. So people left me some iTunes reviews. I'm going to give them a nice thank you at the end of this episode and read out their review. So stick around for that.

Thank you so much, Robert, for being on the show today. Jessica, thanks for having me. It's a real pleasure to be here. Oh, you're welcome. So as I usually do, I kind of like starting from the beginning and getting a little sense of where my guests come from and how they got interested in personal finance. So let's kind of start with you. How did you get interested in the personal finance sphere? Because it is kind of a weird niche thing to get into. It is.

And you know what? I got started in personal finance by reading personal finance books. Go figure. I'm a reader. I read quite a bit. And I was telling you before we got on the air here that when I was 27 or so, I read David Chilton's The Wealthy Barber and it had a big influence on me. And after I read that book, I started David Chilton's The Wealthy Barber and it had a big influence on me. And after I read that book, I started reading just about every personal finance book that has ever been written in Canada in the last 20 years or so. So it sort of became a hobby, if that's fair, but I've always had an interest in it and how I manage my money. And so that's kind of where I got started. And so that kind of did, I'm'm just curious because I feel like a lot of people have – it comes down to their childhood or a family.

Was your family into frugal or how did they kind of manage their money? Did that influence you as you grew up as well? My family was very much into frugal. I grew up on a farm in southern Ontario. So I'm a farm boy. So not only did we, were we pretty frugal about how we spent our money, do-it-yourself was a big thing in my family and self-sufficiency. So if you ever get a chance to talk to my wife, she'll tell you I'm very, very hesitant to pull out my wallet if I can figure out a way to do something myself.

That's amazing. So was it just your passion and your upbringing that, you know, gave you that motivation to write your own book? It's funny because, you know what, writing a book, not necessarily a personal finance book, but writing a book was always a bucket list thing for me, if you will. I was always that guy. And you know that guy, that guy you meet at parties or says, you know, someday I was always that guy. And you know that guy, that guy you meet at parties or says, you know, someday I'm going to write a book or I'm going to write a book. Well, let me tell you, Jess, starting to write a book, it's easy. I've done it lots of times. Finishing the book's a whole new story. So I was that guy for about 20 years. I was going to write

a book. And when I was at work, I was the guy that wrote the creative and funny emails. And it was actually my wife who said, you know, listen, you know, stop, stop talking about it, and then put a pen to paper and get doing it. And the first thing I wrote when I first started was on growing up on a farm, I wrote some short stories around, around, around that childhood. And, and they were terrible. And I was just gonna ask him, like, where can I find these somewhere? Oh, maybe, maybe not. Maybe not. I think I buried them pretty deep in a very small market wouldn't have appealed to a lot of people. So I kind of got a little discouraged by that. And I was thinking, well, what should I write? What should I write? And my wife, again, looked

at my bookshelf behind me, and there's 20 or 30 personal finance books stacked up there. And at the same time, I had just written a series of emails at work trying to encourage young employees to get involved in the RSP plan at work because it was free money and kids weren't getting involved in it. So I wrote a series of six or seven emails that were pretty well received. So all those events kind of came together and I decided I'd start writing a personal finance book and that's where it started. Wow, that's awesome. So how did you come up with the very awesome title, Wealthing Like Rabbits? Okay. First of all, I can't take full credit for the title. The first title that we were thinking about using was just Wealthing, just one word. And that was a little dry and it didn't really capture the flavor of the book, kind of that fun. I agree.

That fun. And it was actually a friend at work that said welthing like rabbits because it kind of cheeky playing words on that other thing that rabbits do a lot of. So that was kind of fun. But I'll tell you another funny story. When we were developing the book and we weren't sure of the title and we had the rabbits thing and I'd already done the part on zombies and compound interest. And later on in the book, I cracked some jokes about sex being a fun thing to do if you don't have anything better to do.

So the working title of the book for a while was Sex, Zombies, and Compound Interest. I like that title. But here's the thing, Jessica. It's a great, clever title. But if you go on Google and Google sex zombies, you actually get a response. Yeah. You may not find the audience you're looking for.

That was not the audience I was looking for. But when we chose to invent the word welthing, and I'd love to say I did this by design, but it was just a freak accident. Wealthing is a word that we kind of invented. So if you go on and Google welthing, everything you get will be around my book because it's the only thing out there that has that word. So it was kind of a good marketing ploy that I didn't really think through. I just got lucky and it happened. Absolutely. That's awesome. Being a digital marketing nerd myself, I'm like, that's great that you kind of, what's our SEO strategy? All right, let's do that. That was all my idea. That's amazing. So I wanted to kind of talk about a few of the topics you talk about in the book.

I kind of mentioned to you before we hit the record button that I read your book and I reviewed it back in September, which I loved. And before preparing for this interview, I just went through the book just to kind of refresh my memory. And as I went through each chapter, I remembered each story vividly. Oh, thank you. That's kind. Yeah. I mean, it doesn't happen too often when I'm reading a personal finance book and I'm like, oh yeah, I remember this chapter. It's specifically about this and there's that guy. And so I thought that was really cool.

And part of the reason that I think the book is a bit different than other personal finance books out there, it's kind of on its own thing. And it's just, yeah, it's an easy way. Just kind of, I also mentioned that it's very similar to one of my favorite personal finance books, which is The Wealthy Barber, where it's written in a narrative style and that helps to remember the information and make it interesting. And you just kind of like, you know, it's a page turner, quite honestly.

You kind of want to know how the story ends, right? Again, Jessica, thank you. Being compared to The Wealthy Barber is about, you know, the best compliment a Canadian personal finance writer can get. And I think that we're blessed in Canada that we have a number of excellent personal finance authors. And I don't want to badmouth our friends to the south, but I think

we do a better job of it in Canada than for the most part the Americans do. But I wanted to write something that was different. And that's why we subtitled it an original introduction of personal finance. If I tried to find David Chilton's voice or Gail Van Zoxley's voice or Preet Banerjee's voice or Bruce Sellery's voice, all those excellent authors, well, I don't think I could have done it as well as any of those guys did it. And I wanted to do something that was a little unique and that would stand out to people who before had not been interested in personal finance and try to get them interested.

And I knew if I was going to take on that challenge, it had to be a fun read. So the goal was to write a book that was entertaining, but at the same time educational, fun, but not silly. And sometimes that's a really fine line to walk. And I hope I found it. I think you did. Because when I was reading the book, I remember, um, I remember remembering that, um, I was reading it and I'm like, this would be a perfect book to give to my little sister when she finishes university and is about to kind of, you know, get her first real job and move out. And, you know, cause that was at that point in my life, that's when I started getting interested in personal finance. Cause well, I had to pay my own bills and I had to figure stuff out.

So, yeah, I think you kind of hit the nail on the head there, finding a really great way to explain complex aspects of finance to an audience who doesn't know where to start. And introductory and foundational personal finance. When I do book signing events and chapters, I always go a long way on my way to tell them that this isn't an investing book. There are tons of books and chapters that do a fantastic job in talking about investing. This is a book, Common Sense Everyday Money Situations, that almost everybody faces things like the need to save some of their money for their future. I hope you noticed that I wasn't one of those guys that said you need to put away every nickel you make, but you do need to save some. And I'm sorry, the math doesn't lie.

The sooner you start in life, the better off you're going to be later in life. I talked quite a bit about homeownership and living within your means and a lot about debt and all the different ways we can borrow money. But very foundational stuff so that hopefully they will have some money someday to invest. Exactly. And that kind of brings me to the first chapter that's all about choices. Yeah. Which I really liked because I feel like a lot of people are kind of afraid to even dip their toes into the personal finance world because they're just afraid of not doing it right or you know they make excuses like oh well i don't have enough money to start

investing or you know stuff like that and at the end of the day it really just comes down to choices and sometimes it's like there isn't necessarily a bad choice you need you just need to kind of start there you know you may you know i remember just when i was starting to invest i remember remember I understood the kind of basic concepts of RSPs and TFSAs and stuff like that and mutual funds. But I was always kind of afraid of putting, you know, a big chunk of money into this mutual fund instead of this one. Cause I'm like, what if I'm not making the right, you know, what if I could make a little bit more money in that one, but I'm investing in this one. And, you know, a lot of it is you just need to kind of

try and just try to make the best choices, you know, you can, and then just keep getting better at it. I absolutely agree. Obviously, we should all try and make the best choices that we can. But if the bar we set for ourselves is we're not going to do anything until we know what the perfect choice is, you'll never make that decision. Jessica, people like you and I and people in the personal finance world, every January through March, we can have the great debate over which is better, an RRSP or a tax-free savings account, which is better under which circumstances. And it's a fair argument. And under circumstances, one is marginally better than the other.

But for most young people who haven't started yet, the far more important thing is that they pick one or the other and they be most young people who haven't started yet, the far more important thing is that they pick one or the other and they be committed to saving for the long term. Some people can wait for years trying to make the perfect decision on that when in fact the perfect decision would have been to start with one or the other three years ago. Sometimes they beat up the details when they should be focused on the broader picture. Absolutely, absolutely. From the director of The Greatest Showman comes the most original musical

ever. I want to prove I can make it. Prove to who? Everyone. So, the story starts. Better Man. Now playing in select theaters. And after kind of the choices, the other chapter that I really loved, particularly

because I think at that point I was considering getting into the kind of the choices, the other chapter that I really loved, particularly because I think at that point I was considering getting into the kind of property world, buying my first place with my husband. I think I saw some posts around that. Yeah, yeah. There's I'll put those in the show notes if anyone's interested. But, yeah, we were really gung ho about like, yes, we're in Toronto. I think we're going to stay here for a while. And it looks like on MLS that it was actually affordable to buy a house. We're from Vancouver, so everything looks affordable. There's something I don't hear every day. Toronto looks affordable.

Well, yeah, when you're from Vancouver, yeah, it does. But anyways, so I really enjoyed the chapter about mortgages because that was something that I knew a bit about, but I couldn't. It just seemed a little bit overcomplicated. Lots of people just weren't very good at explaining it. And then there's, I really just like your story about the Mario and Luigi. And it's funny because I remember reading that chapter and totally picturing Mario and Luigi from Nintendo buying houses. I'll tell you, that was the very first chapter I wrote. You think when someone writes a book, they write it in the order that you read it, which isn't the case at

all. Well, maybe it is for some people, not for me at all. It was all over the page. You mentioned the first chapter. That was actually one of the last chapters I wrote. Is that right? Oh, I love that. That's so cool. Yeah. But the chapter on mortgages was actually the first chapter I wrote. And the first time I wrote it, it wasn't Mario and Luigi. It was the Brady Bunch. And it just got too convoluted and there was too many people. There was too many people in the Brady Bunch. There was inappropriate relationships happening.

And it just got so – and I said, oh, there's just too much information in there. How can I boil this down and find a pop culture reference that's only two people that works for a millennial generation? And I look across the room of my son, who was 16 at the time, as they were playing, you know, Diddy Cart Racing. And I'm like, oh, God, that's so perfect. That's it. Perfect. But, yeah, I really enjoyed how you just kind of made a very interesting but simple story about how, and it's true, it happened to us. When we were looking at getting a mortgage, on one way, you know what you can afford. But if you go to a bank or a mortgage broker, they're going to tell you kind of another number because they want you to spend more than you have.

And then you can get kind of caught up in that, well, maybe we can afford more than we think. Maybe we can afford this huge house. And even when we were looking with a real estate agent, she kept on, you know, we're like, this is our budget. We're like, I'm a personal finance blogger. I know what, you know, a budget when I see one. This is, we're very strict with it. Good for you. She kept on showing us houses that were like, you know, $50,000 more than we wanted. I can see how if someone's not super prepared or educated about all this, they could wind up buying more house than they should buy.

And that's kind of like a lot of people in Canada right now, honestly. It is a lot of people in Canada. What the real estate agents will sometimes do, I don't want to lump them all in. Not all of them, no, no, no. But they'll tell you it will cost this much more a week or this much more a month without any indication of just how much that's going to cost you over the period of 25 or 30 years. So when I wrote that chapter, one of the things I was proud of is that I followed the two brothers through to the end of their mortgage and showed just how much real money it actually costs. And I thought that was

a pretty powerful way to teach a lesson. Absolutely. Are you still house shopping? No. We were, we, I guess we did it for about a month and a half, I'd say. And then we called it quits for kind of the next little while. I'm not sure when we'll look again, but I think we kind of got scared off. Fair enough. I understand that. And you know, one of these guys that's been saying that the Toronto housing market is overheated and it's due to dip back. Now, I've also... I think it is. I hope it is because maybe I could actually afford to buy something one day. I think it is. But like everybody else, I certainly don't know. And I got to tell you, I've been saying it's overheated for five years and I've been wrong every year. So I don't know.

It's tricky to say, but I think, you know, at the end of the day with us anyway, you know, we looked at a lot of places and we knew what our budget was and we're not, we weren't buying a house to be our dream house or forever house or anything like that. We were just interested in buying property so we can like have an investment in that kind of way. And it just became way too expensive and it just wasn't like a sound you know investment basically we're like or we could you know save all that money on like property taxes and mortgage and utilities and this and that and that and uh

put it in the bank and invest it you're speaking my language yes exactly and that's what we've been doing and i haven't i mean honestly i remember during that time that we were house hunting like there's lots of sleepless nights and i'd never i don't worry about money because you know we live pretty simply and we kind of have our budget and we we know what's going on but during that time i started like josh i think we're gonna have to get some more jobs you're gonna have to get a second job at the grocery store or something to pay for this house that we don't have right now and i'm like wait a minute this is crazy let's step back and rethink this let's step back and let's take a moment and yeah and then we

decide that it's just not a not a good time for us to buy anyway good for you yeah i'm i feel good about that decision i haven't looked back since honestly um so yeah another um yeah kind of on that same note because another story i really liked in your book was about casaloma which is you know what's so funny that your story about casaloma and how it came to be was i had no idea that was the actual story oh okay i had no idea that was like a nice history lesson for me that it was this you know wealth or this man who kind of made his money in toronto and in Toronto and then started building his dream castle and then the expenses just got too much and then he eventually went bankrupt, didn't he?

The part of that story that I liked that I didn't know when I started to get into it, I was aware of Castle Oman that a rich guy had built it and he died broke. But what I didn't know is that Henry Pellett, the guy that bought it, made his money in electricity. He was one of the guys that brought electricity to southern Ontario. And in the 1912s or 1913s, the Ontario government changed the laws so that electricity had to

be supplied through public companies. So in effect, Henry lost his job. So that really worked well with what I was trying to do because in our world today, sometimes people lose their jobs due to circumstances beyond their control. So I thought it was a really nice fit into what I was trying to do. Absolutely. And I see this a lot and there's lots of like articles in newspapers and stuff that people, because interest rates are so low, they're buying more house than maybe they should. And they're just basically they're just only, you know, they both have their jobs.

Nothing's going crazy. But I kind of feel for these people that if one of them does lose their job or if something happens, what are they going to do? Or if a couple of kids come along, they're pretty expensive to raise too. Or if interest rates go up. And one of the points I make in the book is that interest rates are at an all-time low. And that's great. They have been for about seven years but I think it's realistic to expect some time in the next 25 or 30 years they're going to go up because people need to be ready for that exactly like they can't

stay low forever if what goes down must go up and you know eventually vice versa yeah eventually yeah we don't know when but you know's kind of inevitable, isn't it? Mm-hmm. Yeah. Kind of switching gears a bit, I really liked your section about credit cards just because I feel like I was just kind of flipping through the chapter. I'm like, that is exactly what I do. Your kind of mentality and mine, like I don't like credit cards.

I don't like credit. I don't like debt. I've never been in major debt myself, and I credit that because I hate debt so much. I just try not to use credit at all. So one of the kind of habits I created, I guess back probably five years ago or maybe more, was I do use my credit card on occasion. I actually use it more now. I don't use debit. I use credit. My credit card is my kind of main payment card. But I don't wait until my statement comes. I pay it off immediately. And it's mainly because I don't like looking at my bank account and seeing that I owe money. And it's a good kind of way just to budget. And it also forces you to be aware of what you're spending on your credit card. I'm sure you know people, and I talk about this in the book, and I'll tell you, I've been there at points in my life where, you know, after Christmas or something, you open up your credit card bill. Even after trying to be disciplined about it, you go, oh, my God, I can't remember spending all that much money. And it's $200 or $300 more than you thought it was.

And I know people that are in a lot worse shape or have worse examples than that at all. But if you pay it off daily, once you've used it, you're always aware of your spending. You know where that money's going and you never fall into that trap. And I think that's an important habit to have. And I definitely have one. I know most people probably aren't as crazy as me, but I definitely look at my bank account on a weekly basis just so I know, you know, I have an idea of what I spent, but sometimes definitely look at my bank account on a weekly basis just so I know, you know, I have an idea of what I spend, but it's sometimes you forget or you forget that you made a big purchase.

Like recently I bought a plane ticket. I look at my credit card. I'm like, oh, okay, well, maybe I should, you know, try to make more meals at home this week. Yeah. You know, and the other thing that I hear a lot that I like to push back on, and I did a little in the book is when people say, as long as you pay your credit card bill in full each month, it's okay to use your credit card. And that's the statement that I do.

I push people back on. Just because you can pay your credit card bill in full, obviously that's better than not paying it in full. Certainly it is. But that doesn't mean the money you spent on your credit card couldn't have been put to better use elsewhere. Did you make an RRSP contribution last year or a tax-free savings account contribution that month? Did you put some money away for your kids' education?

Could have you paid down the mortgage? There are all kinds of other uses you could have used for that money that you used to pay off your credit card bill. So certainly it's better than carrying a balance on your credit card. I don't think anybody would disagree with that. But I don't think people should arbitrarily assume that just because they paid off their credit card, they've used it wisely. I totally agree with that.

So I think we're kind of reaching the end of our interview. But to kind of end things off, I want to kind of go with the flow with your book and it's about finding balance. So what I really liked is how you said, you know, there's tons of books out there, including yours, and they give you advice, but you know, most people at the end of reading a book, they'll be like, yeah, but how do I actually implement that? Or how do I find a balance? And it's true. It's like, it's, it's not, you know, I, I find personal finance, it can be simple when you just kind of look at the really important, important points of it, but implementing it can be a little trickier. Exactly. And just finding balance within your own life. I mean, it can be, you know, hard. What if

you're really passionate about travel? Like I have my friend Stephanie, I interviewed her about traveling. And so she is very passionate about travel, but she also works for a nonprofit, which obviously she doesn't, you know, make a crazy salary and travel is very expensive. So she kind of has to find a balance to afford the lifestyle she wants. And in so doing, she lives a very frugal and minimalist lifestyle. And so I find, you know, you don't necessarily have to go to extremes like that. But I do find, yeah, lots of people probably struggle with finding that balance on like, how do I, you know, find financial freedom or, you know, pay down all my debt, but also

not live in a box and have no fun. Yeah, and I talk about balanced frugality in that people who are careful with their money don't always eat crap dinner and never go out, but they are a little bit more disciplined and they're a little bit more comfortable living within their means. They might drive a used car. I still drive a used car and always have, you know, just a balanced decision that allows me to have more money to free up elsewhere. But, you know, it kind of comes back to what we were talking about earlier. When people get into the, you know, should I pay up debt or should I save for the future debate? Well, I think obviously they're both good things to do.

Paying off debt is good and saving for the future is dead. What I usually recommend to people is do both, even if you can do less of both. I'm always a fan of telling people to start saving because they need to establish that habit of saving. If they pay off all their debt first and then start saving, I think with the best of intentions, they're kind of setting a habit of postponing that savings piece. But I would rather see them get it started, even with a small amount, pay off their debt, and then start to save more once they've done that. But there's no perfect answer to that situation. They kind of need to balance all those fundamentals out together, but they can't ignore them either. And I know you mentioned this really great point where most people that live within their means are happier for it. And I agree with that. I've

always lived within my means. And again, like I said earlier And I agree with that. Absolutely. I've always lived within my means. And again, like I said earlier, I don't worry about money. I don't have, you know, a ton of it, but I don't worry about it. Absolutely. I couldn't agree more. And, you know, you may not have a ton of it right now, but all that's relative. If you're not in debt, if you have $100 in your bank, you say, I don't have a lot of money.

That's a lot more money than having negative $10,000 in your bank, you say, I don't have a lot of money. That's a lot more money than having negative $10,000 in your bank. That's true. Everything is relative. Everything is relative. Absolutely. Well, thank you so much, Robert, for joining me on the program today. That was fun. Thanks for having me, Jessica. You're welcome. Thanks. Thank you so much for listening. And for the show notes notes for this episode all you have to do is go momentumohouses.com slash 16 and if you check out the show notes you'll actually find a special giveaway i'm doing robert brown is so nice enough to give away a copy of his book wealthing like rabbits to a lucky winner so make sure to check out the show notes uh to enter that contest. So maybe you'll win his book for free. And you can also check out more

about him and the book at WealthingLikeRabbits.com. Before I go, I just want to give a few shout outs to some iTunes reviews I have from my fellow Canadians. The first is from Eamon Sattar. Finance doesn't have to be boring. That's what this podcast is about. Love listening to it and would highly recommend it to everyone as it is very insightful and fun to listen to. Excited for more. Thank you so much, Eamon, for your feedback. I really appreciate it. Next one up is from ConnectNet and they say, Jess and her guests make it enjoyable to listen to a personal finance podcast. Fabulous. Thank you so much. I'm glad you were enjoying listening to my show. The next one I have is from Prakris. This is a well-produced podcast

with informative guests, interesting personal finance stories, and good advice regarding personal finance with a Canadian focus. I look forward to each episode. Awesome. Thank you so much, Prakris. And the last one is a bit of a tricky one. It's in French. Luckily, I did go to French immersion, though I have not used my French for many years. So bear with me. This is from Undiep. And they say, Well, thank you so much. And if I understand that right, they are saying very nice podcast,

very interesting about finance. And Jessica has a very nice voice that is easy to listen to. Well, thank you so much. Merci beaucoup. And if you want to get a shout out on a future episode, all you have to do is give me a iTunes review or a Stitch review and I'd be happy to say thank you on a future episode. Thank you so much for listening and I will see you back here next Wednesday. This podcast is distributed by the Women in Media Podcast Network. Find out more at womeninmedia.network.