Nuanced. - 233. Dave Chilton: Author of The Wealthy Barber on the Cost of Living Crisis

Episode Date: April 13, 2026

Dave Chilton, author of The Wealthy Barber, joins Aaron Pete to discuss financial literacy, inflation, rising costs, saving money, entrepreneurship, taxes, and how Canadians can survive the cost of living crisis.Send us Fan MailSupport the shownuancedmedia.ca

There's this looming economic crisis I think we're in and cannibaly. Yeah, I mean, you're not wrong when you say crisis for the affordability challenges. I mean, I think costs have gone up at a faster than stated CPI pace. How do we balance the desire to have something where like, this is what I flurge on? First is I need to get this end goal. One thing I can tell your audience for sure with there's no question about this. That is still the most important commandment in personal finance. by a factor of 10.

And so we're up against it. And I'm just wondering, what gives you hope, what gives you inspiration about the next generation? David, it is an honor to have you on the show today. I'd just like to start by saying

that I received a copy of your book when I was in my early teens and then I reread it in my 20s and now I'm working with my First Nation community to try and implement that across our community. And just a huge shout-up to my uncle Randy, who is very passionate about financial literacy and being responsible with your money.

And he's the one who introduced me to that. I budget. I'm very responsible. And that's in large part due to him, but also due to you. And so it's such a privilege to have you on the show this morning. Would you mind briefly introducing yourself? Yeah, I'm Dave Chilton, the author of The Wealthy Barber, former Dragon on Dragonstan. And thank you so much for that feedback.

I mean, I'm thrilled with the book's impact over the years and the number of people. who've passed it on to others and got younger people in their lives to read it. And the updated version seems to be resonating to the same extent. So it's all good. You mentioned the First Nations community and I've done a lot of speaking in that community. And you'll get a kick out of this and be able to relate to it. One of the hardest speeches you give is to First Nations because the person who introduces you inevitably is a better speaker than you are.

So many of the First Nations, people grow up being master storytellers. and Rick Mercer and I did an event for a lot of the First Nations, and they were all better speakers than we were. Like, we don't want to speak for these people. They're too good. But again, it's the nature of storytelling. And so much of the communication style of the First Nations people is to use stories, wrapped in humor.

They're very, very good at that. So, yeah, I stay away from all that now. I don't want to go in and look like an inferior speaker. So in all seriousness, some of the highlights of my career have been speaking for First Nations about entrepreneurship, personal finance. I've emceived a few major events. It's been a wonderful experience. I've gotten to know many members of the community and the wealthy barbers had good inroads at some of those spots. And so it's been a lot of fun. Really enjoyed it immensely. David, one of the pillars of this show is the idea that one

person can make a difference. And I find that so true with your work because it has had such an impact across Canada and the U.S., but I'm sure far more abroad than that. than I could even imagine. And I'm just wondering, what was the impetus to write it? Because financial literacy is one of those things that it's so hard to break through. It's so hard at times for it to resonate because it can be so scary. It can bring out a shame that I don't know if we have another example of the shame that can come out when you think about where you're at in your finances. And so making it digestible, making it something that connects.

Where did that impetus come from in that? You said all that extremely well. And you're bang on about the shame. no doubt. You know, it's an interesting story. I mean, it was just born of really a little bit of luck in some respects. I was giving out financial planning books way back in the 80s. We're talking 40-ish years ago to clients when I was a young investment advisor and they wouldn't read them. You used a very good word there when you said digestible. They didn't enjoy them. They didn't digest them. They didn't resonate. They found them intimidating, dry, etc. So I thought, what about trying

a different format. And I was giving a lot of speeches at the time, using humor, using stories, and I thought I'll put that in book form. Initially, I started out with the book called the ultimate guide to losing money. And it was a humorous look at the way we handle our finances, the mistakes we make, short chapters, bursty again, humor. I thought it was fairly solid. But one night, all these decades ago, I was watching Cheers. The TV show set at a bar, and I thought, I wonder if you could use a fictional approach. And I called it the wealthy bartender, initially, but then alcohol got in the way because you're weaving that into the story, couldn't do it, moved it over to the barbershop, and for whatever reason, it just took.

People really liked the characters, they felt comfortable in that environment, listening. They could see it in their mind's eye as they read the book. I did a lot of testing as I wrote it, so I would give it out to the target ideas, incorporate their suggestions. And I'm not that sharp a guy. Like, honestly, I've had one really good idea of my life. Thank heavens I had it when I was young. and for whatever reason, this is the one that stuck with people and really got them embracing personal finance.

And even watching the updated version, you know, I thought it's a different time. People like TikTok. They like all of the videos now. Will they really read a book or listen to the audio version? And so far the answer is yes, it's number one in the country. And I think, again, it's all because of the story format. It's because people buy into the characters they can relate to them. So the narrator, for example, he doesn't like math.

He doesn't like finance. He doesn't have any confidence. Well, a lot of the readers go, that's me. If he can learn as he goes through all these visits to the barbershop, so can I. So it pulls people in through that unusual delivery mechanism. I love that because there's something about oral storytelling and that piece that really resonates with me. Because within First Nations culture, as you were talking about earlier, we're so oral in our tradition and telling stories and stuff that you're able to adapt it to the audience. so they understand. And so, like, you could imagine two First Nations people a thousand years

ago walking along and goes, oh, there's this and there's that, and they're telling stories about the mountains and the trails and stuff. And then you think about Shakespeare. And I think everybody knows that Shakespeare is important, but it's hard for that always to resonate. And so the more you can adapt it to the real lives of people, the more that like the story shines through. And I'm just curious, is there something about the story that you wrote that really stands out to people or is it really what's stood at the time, it kind of surprises you or stands out as something that was important to readers? Yeah, you know, it's interesting.

I am a little surprised, even with the new version, the fact that it continues to work. Like, as I mentioned a moment ago, I felt with all of the social media opportunities out there, all of these platforms, the way people listen, the way they learn has changed now. They have attention, deficit disorder. I have it for heaven's sakes. It's hard to stay focused now. with all this coming at us. But when you tell a story effectively, people do see it in their mind's eye. It's more like a movie than it is a book because they're visualizing it as they go.

And if you can have dialogue that's bouncing back and forth at the right pacing, you're using humor, you can really pull people in. I also think having the barber, the actual mentor, someone that people trust that I put a lot of work into laying the foundation for how did he become so knowledgeable. I wanted that to be realistic for that to make sense to people so they could truly buy in. But really the big answer to your question is, I think the testing of the book has been probably the most underestimated part of its success. The writing process that puts all these chapters, all these pages into the reader's hands ahead of time, incorporates their feedback, listens to their questions, their concerns, rewrites. I think that's been vital. Now, the downside

to that is it takes forever. So you're looking at a year and a half to two years to put a book together. The upside is by the time it hits the marketplace, it's been battle tested and altered to make sure it in fact does resonate with the target audience. So I mean, I think it's a good tradeoff. I wouldn't do it again. I'm old. And, you know, at 65 years old, to do it again and give up another couple years of a writing project where you're basically by yourself all the time, 50, 60 hours a week, I think those days are behind me, but I'm very glad I did the updated version. The other piece that you had already mentioned is that there's some changes to the updated version. And I'm just wondering what financial tools have changed or is it more about

connecting people more with the story? When you started thinking about updating it, what were some of those pieces that you felt were important to address? Well, sadly, I underestimated the number of changes when I first sat down to write it. I mean, we went from having just R.S.P's, for example, to now also having TFSAs and FHSAs. So I kind of thought through, well, that's no problem. I teach those in video form. I teach them on stage. I can talk about them in the book.

But of course, what happens is you not only have to teach the subtleties and the details of those accounts, but also how do the three relate to each other? How do you prioritize based on your circumstance? And how do you do all of that and still keep it interesting, not have it bogged down? That became the writing challenge. So you've got these new accounts. You've got things like exchange traded funds that are great opportunities for people to lower their fees. You've got to explain all of that.

And then on top of everything else, it's a little harder now. Let's be honest. I mean, younger people are facing very high costs relative to income, particularly on the real estate front. And because shelter is absorbing so much of people's income, setting aside the 10 to 15% that the wealthy barber and frankly all financial books recommend, that's a challenge. And so you have to realistically accept that. You can't just ignore it and pretend everything is easy and hunky dory. You have to dive into, okay, that is tough. Here are some of the techniques you can use that may help you along that path.

And then finally, psychologically, it's definitely more difficult now because of social media. We've got all of these platforms, all of these apps coming at us at all times, trying to get us to spend their money. And they know how to target our weaknesses through their algorithms. And so in my case, if I'm drawn to sporting events, they know that. They figured it out and they're going at me with Detroit Lions paraphernalia, Detroit Lions, tickets, et cetera. It's very difficult to avoid temptation now.

So from a lot of perspectives, I would argue it's probably a little tougher now than it was in 89, 90 when the book first took off. And all that had to be reflected in the book. Again, you can't ignore it. But that made the writing process a lot of fun too. And it made the testing that I mentioned earlier more important than ever. I'd love to get into some of the advice you might have for people and the importance of picking up your book. But before I get there, you probably have one of the best lines of sight into where our country has been in regards to financial literacy. And as you're kind of describing how bad things have gotten in recent years due to inflation, global supply chains, all these other issues.

And so I'm just wondering, what have you seen over the time of this book? Has financial literacy come up and down? Has it only gone down? Has it only gone up? And what is it like for you to hear those stories? Because I'm sure people come to you and go, hey, David, I was in this terrible spot. Then I picked up your book. And you get a real line of sight into people's financial circumstances.

And kind of where our country is that in terms of our ability to manage our finance. You know, I love that question. I've been surprised I haven't been asked that question more about what trends of it has seen on the literacy front. Because you're right. I'm in a lucky. position to hear back from thousands of people about where they are now, et cetera. And I get into a lot of schools and I'm able to kind of get in touch with students at both the high school level and the university and college level. So a couple observations. I would say the group of people who have

improved on the financial literacy front is fairly significant. Instead of having, say, five to 10 percent of people have reasonable knowledge levels. It now be 30 to 35 percent. And a very good thing is among that group, a lot of the people are very sharp. They're reading everything. they're on YouTube. They're not just wealthy barber. They're Ben Felix. They're all these people. So that's a positive. But the 50% at the bottom that don't know anything about finances, they don't know anything about finance. That unfortunately hasn't changed. But what I found interesting is a lot of high school curriculum throughout the country, the different provinces and territories, has been changed over the last 20 to 30 years and personal finance has been injected into it. It's not working. So I applaud the school

systems for trying and change in curriculum on, again, a provincial and territorial level, but the way they're teaching it is not resonating. I can see that from dealing with kids after taking it. I think they've got to use more story, make it more entertaining, et cetera. Now, some of it, researchers have said is because a lot of younger people don't have much money yet, and this is all abstract and they have a little more trouble taking it in and applying it, but I think different teaching techniques would work too. Another challenge that's come in on the financial literacy front is a lot of people are getting their information now online through TikTok, through Instagram Reels, et cetera. There's positives there. There are some very competent educators who are

outstanding communicators, but there are some very bad ones. And it's very difficult for the average person to discern the difference. They don't know whom to trust. They don't know what the background credentials of these people are. The other problem with doing these short, bursty videos, and I do some of them, is you don't have enough time to cover off the nuances and the exceptions. And those are a very important part of this. So you have to be very careful in the communication front. You don't end up giving, in essence, blanket advice and pointing people in the wrong direction.

And I've been criticized a few times for, well, you're not getting specific enough. And I say, you can't. I don't know the people listening. I don't know their specific circumstances. So I can kind of do the overall situation. I can guide them towards other resources. I can try to make them think. What I can't do is give them specific advice.

I don't know them. And so all of this is fairly limiting and challenging and there's balances that have to be struck. But I still think financial literacy is a major issue, maybe a little bit less so than it was in the late 80s and early 90s. But the improvement is not what I would like to see. And just what has it been like? Because as a First Nations chief,

I've gotten to see the living conditions on reserve. I've gotten to see the challenges people face in being able to just put food in their fridge. And I imagine some people are coming to you at events with those types of circumstances. Maybe you're working with a kid who you can tell is in a really tough financial situation at home. What has that been like? Because that's something I think most people miss in our society. Like when we meet somebody at a grocery store, we don't really think about their financial situation really is. and you're a person who knows, I think, better than most,

even wealthy people can misspend their money and really have nothing, no nest egg, no kind of financial stability, even though they have a lot of money. And then you can meet people who really have a good handle on their money, but they just don't have a lot of it. And so I'm just curious what that has been like. Is it a wait when you meet people and you know that they're in just tough financial circumstances?

And I'll just say one more thing. it's really tough for me to see people who are at a job where they could be doing more and they're kind of stuck there because they're at the top of the echelon at that job, but they could probably be able to make more money somewhere else. And it just, I think a lot about people's potential. And I think a lot about how these tools can be learned by everybody, but they're not. And so people are in a tough financial situation. And there isn't always a clear way out, but there's also like just a human element.

And you see that so much. And I'm just curious. You said all that again very, very well. And I think inertia, by the way, plays a role in some of what you were describing. You know, it's all over the map. I mean, it really is. Unfortunately, in Canada right now, we've had a run of inflation. Costs are very high.

And we have a number of people who just don't have a significant income, significant enough income to do a lot of what the wealthy barber teaches. I'm the first to admit that. They've got to try to survive. You know, they can't be setting aside a lot of money for the future. How do we help those people? How do they help themselves? It's interesting when you go to the First Nations communities,

how many people are naturally inclined to be entrepreneurs? They don't necessarily seek out those opportunities, but when you have discussions with a lot of people in the First Nations community, they have that skill set. They think like entrepreneurs. And I think that's something we have to do a better job of, is getting a lot of people to take a chance, to believe in themselves, to do more research on where are the

opportunities and entrepreneurship. The great thing now is, although the world is very challenging, oh my gosh, it's never been a better time to start a sidegake. There are so many opportunities because of technology, so many low cost, no cost ways to enter the entrepreneurial world and try to get a second income or start some additional monies flowing in. And so that's something I think a lot of people have to pursue. But hey, I'm the first two minutes easier said than done. When you have a full-time job and two screaming kids at home. And like, you know, a lot of my friends do, they're saying, Dave, are you kidding? I can't look into a second job. I'm having trouble juggling my time demands right now. So all of this is tricky. It starts with education.

I mean, I've listened to you. You're trying to motivate people to get them hope, to make them think bigger things are possible. Well, that all may sound corny to some listeners, but it is key. You have to believe that a brighter future is in your own control. that you can go out and you can make a lot of this happen through hard work, through innovative thinking, through creativity, through reading, through learning, through growing, all of it. I love all that stuff. Like, I'm old. I turned 65 this year.

I still read all of those types of books. I'm still always looking for new ideas, pushing myself to change, pushing myself to grow. We have to do all of that. And as a country, I think we really need to embrace a lot of this, including entrepreneurship, because right now business formation is way down. It's way down. Now, to go to one other part of your question, you mentioned that there are a lot of people

who have managed to build up pretty dark good incomes and they're still not in good financial shape. That's a group I hear a lot from because they read the wealthy barbara, they've got a family income literally in some cases of a quarter million dollars and they have no savings. In fact, they have a significant debt issue. We see a lot of that.

And, you know, people are pulled into spending again through social media, through bad habits, through thinking I'll change down the road, but then getting into deeply, something happens that they get debt and then they lose a job and they can't manage to service it, et cetera. That group we need to educate as well on the other end of the spectrum. How do we make sure that they stay on the right path and they do the wealthy barber type things? Constant challenge, no doubt about it. Let's be honest, so much of this comes down to human nature sabotaging. A lot of what Dave Chilton and other financial experts are trying to teach. We give in the temptation. We love to spend. We define ourselves by our possessions.

There are a lot of moving parts here. I love that, particularly the part around entrepreneurship, because, and I heard this quote, and I'm forgetting who said it, but they just remind you that you can fail at your plan B as well, and that that's important to remember. That you might as well sue for your dream because there's a risk that even on your backup plan, that doesn't work. No, I agree. And do you not agree with what I said earlier that a lot of people in the First Nations community naturally think like entrepreneurs. A lot of them have that skill set to the nth degree. I think that's an area that's got to be pursued more. I completely agree because it can be small steps, right? Like when I started the podcast, it was just like a microphone in a crappy video camera. But I was able to do it for like a thousand dollars. And I see that so much with First Nation communities. where it's like, I'll just start feeding. And if I make $50 on the first thing that the necklace I make,

then I have $50 to go buy more. And it can become an iterative process. And I think so much of what we think entrepreneurship is, is taking out a quarter million dollar loan or a half a million dollar loan and then getting started. And it doesn't have to be that way. You can start a little side project and build up to something bigger over time. It doesn't need to be that you're going to get a PhD on your first day, right?

Like that would be a crazy ass. You start small and you build up and to work. towards the sense of it. You said all that extremely well. And again, I'll go back to something. I said a moment to go. There's never been a better time to start small and build slowly because of all the tools out there. The AI tools, the online world provides all kinds of opportunities for people. You can now reach an audience relatively cost effectively. I mean, think what you've done. I doubt you've put much advertising effort in and paid advertising into building your audience. You just have to start slow, recognize it's never going to come super quickly.

but if you have high quality guests and you stick at it, you find an audience. And once you've found the audience, other good things can flow from that. There takes some patience. And you know what, a lot of stick-to-itiveness. You have to be resilient. There's going to be some falling back. I mean, I remember when I was on Dragon's Den, you are really, when you watch the people come down the stairs, trying to assess who has grit.

Because no business ever goes like it's supposed to. They all go up and down and all around. going to get up off the ground when they're knocked down, who has that resilience, I mentioned, that stick-toitiveness. These are all the things you're looking for. But again, I would argue, it's never been a better time to be an entrepreneur. So many tools available. So we need in Canada to push people in general more toward that direction. Not everybody's wired for it, but a lot of people are. I couldn't agree more. When I started this, I said, I'm going to do a thousand episodes. And that sounded completely insane. But I mean, we're almost at 250 now and working towards

that goal. And so it was just the mindset of like, I'm going to make the final benchmark so far away that I removed the needs to get it perfect the first time. And then again, I think that I want to cut you off because you're being humble. I mean, you think about what you've done. You've had over a million views of your podcast. And so for people listening, watching right now, think about that. As you said, you started with no audience, a thousand dollars on a microphone. You did not spend big money trying to to go out and get an audience. You didn't have an established brand. You've had over a million downloads of the podcast. Like, it's astonishing. And that kind of possibility is there, but it takes time. How long ago did you start the podcast? Five years ago now.

Yeah, so think about that. You know, what you've been able to achieve over that timeframe. And of course, success begets success. The more momentum you've built, the more downloads, then you can get better guests. You're drawing more attention. It feeds off itself. it gets bigger still, you're bringing good information to people.

It sounds corny, but you're making a difference in their lives, which is what this is all about. How do you add value? That's really at the end of the day what's successful business is about. How do you help people solve problems? How do you add value? So, I mean, I give you nothing but credit. And I think that that's a remarkable achievement to get up to the million mark.

Wow. I mean, very, very impressive indeed. Well, thank you for that. And I'll also just say one of the unique things is individuals like yourself who are willing to share your time and your knowledge has been something, I don't think, gets enough credit in this podcast space because we asked for your time. I've seen you do a ton of interviews lately. And that's a lot of taking risks and trusting people with your time. I'm sure you've had a few where you're like, is that really a good question? Like you're, you're being generous and hoping

for the best through the conversation. But you, like, I didn't send you a list of questions prior. And you trust and guests trust with large audiences like yourself, people like myself, to use your time thoughtfully. But I just find the generosity from people like yourself. Really a funny story about that. I don't like getting the questions at a time, by the way. And in the rare instance, we're sent them. I don't look at them.

I'd rather just have the casual conversation like you and Arbor. But I will tell you one funny story. We had a woman to reach out to us. She said, I'm like you to come on my podcast. But I want to be up front with you. I think I only have like 10 to 14 viewers. And I said like 1,000 to 14. And she goes, no, like only 10 to 14.

She goes, I got some family members watching me about that. And that's about it. And I said, you know what? That is such an honest thing to say. I think I'm going to do it. And so she's supposed to be back out to me next month that I'm going to go on the podcast. And so again, she's starting early and she's starting out. And let's see what happens with what she's trying to achieve.

But I've enjoyed it. You meet a lot of very interesting people. And when you reached out, I was happy to do it. And I didn't even know your solid numbers at that time. But I did it because I've enjoyed my association with all things, First Nations so much. As I said to you, some of my favorite speeches have been tied into that community. So I was thrilled to have the opportunity. Oh, such a privilege. Can I ask, we're in this cost of living crisis right now. And I'm just wondering for people who are just

just getting the idea of taking these first steps, we're planning some financial literacy education classes in the next couple of months. What are kind of the first few things they should be thinking about or starting to do knowing that there's this looming economic crisis, I think we're in Canada. Yeah, I mean, you're not wrong when you say crisis for the affordability challenges. I mean, I think costs have gone up at a faster than stated CPI pace. You look at food inflation. It's been absolutely incredible over the last five to seven years.

And things that aren't getting enough attention, car insurance, property tax. So many of those types of things are rising so quickly relative to incomes. They put a huge squeeze on people. And again, we've mentioned real estate. So many people have to dedicate a big portion of their annual or their monthly income to either rent or to mortgage costs that it's making it very difficult for many to do the proper things. So what tips do we have? Well, I mean, one thing, chapter nine in the book goes through a lot of saving tips. Little things, by the way, these aren't earth-shattering things. You're going to go, oh my gosh, Dave is smart. I can't believe he came up with that. But the series of tested tips that cumulatively will make a big difference. But one thing I would say in the literacy front to the audience you're trying to appeal to is there is, there is one space where a lot of Canadians are voluntarily overspending to the point they can't blame others and that's cars. And so if you look at a lot of the budgets and spending summaries, I see, wow, this person's been responsible. They've done some very good things, et cetera. It's the darn

cars. Relative to incomes, people are spending so much on cars, often both parts of a couple, both the husband, the wife, the man, the man, whatever the couple makeup is, they're spending a lot on cars. That's one place that I think a lot of people in this high cost environment have an opportunity to buckle down and need to. We define ourselves to some extent by our cars and we have to stop doing that. There's nothing wrong with driving an older car, used car, etc. Or stretching it out a little bit to try to save that money so it can go to more important spots like funding retirement accounts or for that matter, like doing some travel, like whatever you're going to do with the money. But in general, it's tough to save. One of the things I've seen people like Ben Felix pushing lately and

he's one of my heroes, a great financial educator, goes back to your first point. Yes, watch your costs, but let's try to get a little extra income. As we've said many times already, there's no better days than today to try to get a little extra income, whether it's taking on a side gig, whether it's developing your own business, there's things that have to be paid attention to. But the single most important thing I would say is the starting point on literacy around saving money is due a spending summary. So this sounds boring. it's a bit annoying. I admit that. But for the next two to three months, chronicle every single thing you spend money on. Write it down. I much prefer actually writing it down over using the apps,

although there are some pretty good apps. That experience has proven to be unbelievably impactful for people. When they see where the money is going, they almost subconsciously start making some changes to free up some cash full. I'm not getting enough joy units from that particular expense. That would be better going here. Here's where I see some leaking. and everybody spots places they can suddenly start saving some money. It's a wonderful thing to do. It is a bit annoying. There's no doubt about it.

It is time consuming. But the impact quotient is beyond the beyond. I love that one because yearly now I go through all of my subscriptions to double check that I'm not subscribed to something that I don't need. Because it's $5 for my eye cloud storage thing. It's $3 for this. But all of those things add up. end their monthly. And so they can be significant when you look at the year end. No, they really do. And you know what? By the way, when people do spending summaries,

there's a lot of common denominators. Like people say I spend too much eating out. And it's funny, a lot of times I see people know they have a weakness. But then when you do the spending summary, they go, oh my gosh, that's not a weakness. That's a weakness squared. I knew I was spending a lot eating out. I didn't know I was spending this much. And so that light is shone. But the area that I see come up the most is on little things. People go, you know, No, I couldn't figure out why there was no money left at the end of the month. Now I know between the coffees I have in the morning, then I go to the rink to my daughter's hockey, and I buy a muffin there and I buy a coffee there.

I pick up chapstick. I pick up this and they add up all of those expenses under $20. And at the end of the month, they go, oh, my gosh, it's $1,000 a month that I'm spending on all of that. I don't need a lot of that. I can cut back. I'm not going to eliminate it. I want the odd coffee.

I need the odd chapstick, et cetera, but I can certainly save $500 there. Well, $500 a month is $6,000 a year. That's almost a fully funded TFSA. I mean, that is a lot of money. You know, there was a line in the updated book that I was surprised at. I thought it was kind of a throwaway line. It was a bridge in one of the stories I was telling. And Kyle, one of the characters, says, I'm $4,000 short this year on where I want to be

for my FHSA. He wants to max the contribution at $8,000, but he's only got $4,000 put together. I need to start saving more. I don't think I can do it. And one of the other characters says, you know, it sounds like a lot, but it's only $11 a day. And Kyle goes, 11 a day. I think I can do that. Make a little move here, a little move there.

In his case, he was doing some sports betting. I wrote that and kind of moved on. It was, again, a bridge to something else in the book. Do you know that of all the reader feedback, it's probably the second most we hear is about that particular paragraph. People have gone, that was interesting to me. I took that big amount, did it on a daily basis or weekly basis. went, I think that's doable. Psychologically, there was an advantage to breaking it down to a

shorter time frame and therefore a smaller amount of money. And people started to see possibilities for where they could save that amount. Who knew? I did not expect that to be this impactful, but I'm thrilled it has been. I totally understand that. On that note, I'm sure you know who Morgan Housel is. Yeah, he's been on our broadcast and Morgan and I know each other. And honestly, one of the best financial writers in history. And there's no, exaggeration there and an unbelievably nice person. So he's got both those things going for him. Oh, that's fantastic to hear.

I'm just curious. When you think about the car and the, perhaps the Starbucks, I often think about like where people are trying to find a spot that they can be really proud of. Like people like to have their car because when I pull up to see you for dinner, you see my car or when I'm at the Starbucks, it makes me feel like Starbucks was always described as being a little bit more high end

than a little bit more luxurious. How do we balance the desire to have something where like, this is what I slurge on versus I need to get to this end goal because I have a lot of like sympathy for those people but I also think to your point, they can stop you getting to real goals

that are like far more impactful than like a day-to-day item that you're just adding to your cart that's not really improving your quality of life or reaching a bigger goal. You know, Aaron, you're asking great questions. Like, honestly, you're a very, very good interviewer. And I think a lot of it's about balance.

But I'll tell you something that's very unusual that the research shows. You can make a stronger case for the Starbucks spending than for the car. And I'll tell you why, the people who go to Starbucks, take all this criticism. Oh my gosh, it's 10 bucks here. It adds up there and blah, blah, blah. But they tend to get a lot of joy every single time they go back and get that expensive coffee. What's interesting about cars is, we spend all that money on cars.

Within weeks in many cases and months and most others, habituation sets in and we don't get that much joy from it. We get a customer driving the car very quickly and the newness, the excitement all wears off. And therefore you can make more compelling argument. The coffee is giving you more cumulative joy units over time. To go back to your question, though, it's all about balance. The people who say never go to Starbucks,

take away the things that give you great joy, those little splurges. Come on. bad advice, it's not realistic. It's when you do the spending summer, you see, okay, I'm seeing I'm getting some value there, but I probably still need to cut back a little bit. I really think that it's gone too far. So I'm not saying get rid of all of the little joys in life. I'm saying, watch the balances, look for some opportunities where it's not giving you the joy to make the cutback. But the other point I'd make is one that I think I've really pushed hard over my 35 years out there. I have seen when people get on top of their finances, make some cutbacks,

They use the word sacrifices. It sounds negative. But interestingly, when I speak to them a couple months later, they're in better spirits. They're happier people as corny as it sounds because they're on top of their finances. They haven't missed the items they've cut back on. And even if they have a bit, that's been overwhelmed by the satisfaction of now hitting some of their savings goals and knowing they're on top of their finances. There's less stress in their life.

And overall, it's been a net positive psychologically. And I try to make that point all the time because one of the things you run into is that people always are saying, I want to have fun now. And yeah, I can do everything Dave Children teaches, but I'll never be able to leave my house. Well, first off, I don't teach to make that kind of sacrifice. But secondly, people are wrong that when they do make some of these pullbacks, they do make some alterations of their finances. They tend to be happier, less stressed. And so I actually put that in my second book twice. I had the same paragraph in the same book twice.

I don't think anybody's ever done that. And I even said, I hate to quote myself, but that's how important this is. And that's a message I really try to drive home a lot. That's fascinating because what you're like likening it to in my mind is going to the gym. Because the first day you go to the gym, nobody feels great about where their body's at or how big their muscles are or how good their cardio is or how much they can lift.

But three weeks in, a month in, two months in, you start to change your understanding of who you are and what you're capable of and to build up some confidence, but it takes a little bit of time of being humble, being a beginner, being a novice,

and almost embracing that for the first period and just going, I'm going to try, I'm going to keep crying. Well, you've nailed it. And you know the research on going to the gym,

how you need to get to that point, to have the stick to it, and that discipline, to get to the point where you start seeing a physical difference in your body. Because that itself becomes so motivating,

then you really start sticking with it and good things start happening. It's very much the same with personal finance. When you first make some changes and try to increase your savings rate, you do have a feeling of sacrifice. There's a little bit of stress associated with that. But relatively quickly, you start seeing the savings build. You start realizing you're more on top of things.

And much like your gym analogy, you start feeling better about things. And then it starts speeding off itself. And I've seen this in so many different ways where you've had husband-wife teams, for example, say, hey, we need to cut back $20. a day. $20 a day is $600 a month, $7,200 a year. It's a fully funded TFSA. Let's make that our goals. And they almost gamify it. So they're looking to save 20 a day. They're competing with each other to get to the $10 mark. They're showing each other what they're up to, how they did it. I walked here instead of dry, all these different types of things. And it turns into a fun exercise. Interestingly, people love to

criticize young people. Oh, people in their 20s, they're traveling too much. They're spending recklessly. but honestly, I see a lot of good things come from that group. A lot of them have come up with creative ways to save. I mentioned in a video I did recently. The board games are making a big comeback. People are looking for less expensive hobbies now. You see that group drinking less, going to the bars less and taking in less alcohol. It's not good for you, but also it's very expensive.

So I actually see that group making some very important changes to try to free up capital. Some of it's been forced upon them, of course, because of the expensive real estate. That's one of the topics I wanted to chat with you about is just kind of where we are as a society. Because I think systems play a big role in this. But before I do, I'm just curious. Okay, so somebody has their savings account in order, they're budgeting properly, they've got an emergency fund. I'm just curious how you think about these new financial tools that have really kind of started to take off from, I think, a government perspective. Because we have the RRSs, the registered retirement savings account.

and then we had the TFSA, which was pretty new. I think Harper brought that in. And it was a relatively small amount at the start in. It's continued to grow in terms of how much you can put into it. But now we have a similar program for housing and education. What are your thoughts on those tools expanding? And which ones do you find the best bank? I mean, if you are qualified for the FHSA, you're looking to buy that first home,

we've never had a better account. I can say that with absolutely no caveats. It doesn't get any better than the FHSA. You put the money in. You get the tax deduction like with an RSP. But when you take the money out to buy the home, it's not taxed. Like the TFSA, it's the best of both worlds. And so if you're putting in, let's say, $4,000 one year and you're in a 30% marginal tax

bracket, you're in essence getting a gift of $1,200. And you can put in up to $8,000 a year to a $40,000 lifetime max. Well, again, let's use that $30,000. percent tax bracket, you're getting a gift of 12 grand because when you take the money out, it's not tax. Plus, you get the compounding growth coming out tax free as well. Even though it tends to be invested relatively conservatively, the FHSA is a great account. Absolutely. And for people looking to build a down payment, that should be priority one. The TFSA is also wonderful. I mean, if you don't like TFSAs, you have a fundamental misunderstanding

of arithmetic. You know, you put the after tax money in there. It grows untaxed. It comes out untaxed. So obviously that's a great deal. Now, most Canadians can't afford to fund all of these to the max. We're struggling to pay our bills, of course. It's a high cost environment, as you and I have said. So often one of the questions I'm asked is, I can't do it all. I'm trying to build a retirement fund, TFSA or RRSP. Well, for most people, they're both very fine moves. but I think for a lot of younger people with lesser incomes, the TFSA may take priority, it's tough in a podcast environment to kind of walk through all the nuances here, but they're both very good moves.

There's some great online information about how to make that comparison. The wealthy barber walks through it very carefully and it's very understandable. But any of those moves is good. And of course, paying off non-deductible debt. It's not a new account. It's not a new approach.

But if you have credit card debt, pay it off. You're earning 21, 22% after tax, I can't teach you how to beat that. Nobody can. And it reduces stress and it frees up cash flow, and it builds pride and ownership. All of those things are wise. But interestingly, all of those things are what gets discussed most often in podcast, radio interviews, etc. But the one that gets left out is actually from most Canadians priority one if they have a chance to take advantage of it. And that is the group RRSP at work if your employer is matching your contributions. And in many instances in Canada, you put $500 into the group RSP, $2,000,

whatever, they match it dollar for dollar. You're getting 100% return the day you get in. Come on. It doesn't get any better than that. For most people, if that's available to them, going up to the match max is their best first move. Interestingly, even better than paying a credit card off if it's dollar for dollar. That probably deserves more attention than it gets. Agreed. I find that really important because my partners has the opportunity to do that and she just gets to see the reward of like all of a sudden at your end seeing how much money has been put in from both parties and that that I think really matters. If she doesn't keep making advantage of that, you need to break up with her. No, I'm marrying. I'm marrying her in about a month. I take it all back. But that being said, keep her on that group RSP for sure. then. Hey, congratulations. That's exciting. Good for you. Where to go?

Thank you, good sir. I'm curious. One of the things I've really struggled with, and I think it would really help to get your understanding. When I look at our system as a whole, when you zoom out even past kind of what to do in the system, you look at the system, I really don't like the inflation, the fact that we have inflation. I think we should have a gold-backed currency. I don't know how often you get asked about that. But I just think about how you talked about food inflation. It was 27% over the past five years.

It was about 20% overall. And so that number is going up. And then governments will come out and go, oh, inflation is cooled back down to 2%. Yeah, but it's still all the way up here now. And it's not coming back down to where it was. And so I look at this system where you have to invest. You can't just put your money in a savings account and leave it there. You have to be beating the market.

You have to be moving quicker than it. So you have to be investing money. And then I just think, like, what society has we built where you have to be trying to choose S&P 500 exchange trade funds? You have to be, don't do mutual funds, do this. I'm watching videos on Brandon Beavis. And I'm just going, like, why can't we just have sound money where you just put it in a savings account? And it's worth the same amount five years later. Why are we having to run this quick?

Do you get to think about that a lot? I know a lot of it's trying to exchange this process. No, no, I think about stuff like that all the time. I mean, I'm a financial geek to the nth degree and there's a lot of smart people out there who are in your camp. And that is why do we even have a 2% inflation target? And again, this is very complicated stuff. But let me make a couple observations. You mentioned food inflation, maybe being as high as 27% cumulative over the last five years.

Come on, that is understated. And so, you know, I'll try to say I see what stats Canada is doing. They show their techniques. A lot of smart people there. I've enjoyed studying what they do. There's no way that number is accurate. if food inflation has run hotter than 27% over the last five years. That's point one. Point two, you pointed out something I don't think gets enough attention and it's a basic

point. Yes, we may have inflation back down a little bit, but that doesn't mean prices are going down. Okay, you need deflation for prices to go down. What we've had is disinflation, a slowing inflation rate. But those prices we saw go way up are still up. In fact, they're going up a little bit each year. The current inflation rate, wages for the most part haven't kept up. What do we need? Well, I mean, I'd love to have a better system or to your point, we had less inflation. But I think in democracies, that's unlikely to ever happen because obviously governments spend tremendous amounts of money as in democracy. All throughout the Western world, we've seen it throughout civilization. And eventually we get into a lot of debt problems

at the government level. We're there now. You look at the U.S. debts. They're untenable. They're not paying them all back. It's mathematically impossible. So I think you're going to have deficits. You're going to have excessive spending. You're going to have inflation at some point. You try to keep it as subdued as possible. But all of your points are bang on. This makes it very difficult for investors. They have to be saving. They have to be investing trying to grow their money at faster the inflation rate pace. What we need, and I think economists on the left and right, liberals, conservatives, everybody agrees on this front. We need productivity gains in Canada. Because if we can get productivity gains, we can have wages rise faster than inflation. So we have a situation where if we can

get productivity gains, then we will have wages grow faster than inflation. And we have had a productivity problem in Canada to the nth degree over the last 10 and 15 years relative to the other G7 nations. A lot of contributing factors. We're not investing enough in research and development. We're not giving our workers enough tools on those fronts. I have a lot of theories. as to why. I mean, one of them, if I can share it is, we're a country dominated by oligoplies at the top of most industries, grocery, banking, telecommunications. When you have that kind of economic setup, they're not incentivized to research and development innovate the same way upstarts are or highly competitive marketplaces are. They're all about market share. I understand that.

But at the end of the day, I don't think that's necessarily very good for society. We want a lot of competition, that's what spurs on, innovation, R&D, all of these types of things. So Canada's facing some real challenges on all of these fronts. It'll be interesting to see how things play out over the next 10 and 20 years. I hope I'm around to see it all. And of course, AI coming onto the scene changes everything. Maybe it's the perfect tool to get these productivity gains, but it's going to also disrupt certain aspects of society, especially with the speed it's coming on at.

I don't think our policy makers in their defense. I don't think I could either can keep up. I don't think our institutions can keep up. It's going to be a very interesting next few years. Intimidating and exciting simultaneously. Well, I'm really grateful that you've said that because I just did a breakdown of the cost of living. And I talked about inflation, debasement of currency, global supply chains, challenges going on around the world with weather.

And one of them was these oligophiles with like law of laws and how there was a boycott against them, like I think a year ago or so, trying to remind people that a lot of these grocery chains have the ability to say other smaller, like, bread places or places to get your fruits and vegetables cannot be within their distance to reduce competition within them locally. And I think that that's really dangerous.

The other piece I wanted to get your take on is taxes. Because we keep talking about, Oh, we, like, Canadians need support with the cost of living and provinces. Yeah, I mean, we're a highly taxed country and we're a highly regulated country. And interestingly, you can make a compelling case from most of the individual regulations. You really can. I mean, the people putting them in place are well-intentioned across the board. But cumulatively, when you have this many regulations, you drive away business.

And one of the reasons is very basic and it doesn't get discussed much. When you have to comply with this many regulations, it takes. makes a tremendous amount of time to go all through those approval processes. And the investors who are looking maybe to build a new factory, open a new business, they're saying, I can't predict what the macro environment's going to be like five and seven and eight years down the road when this factory finally gets through the approval process and gets built. And so they pull back.

And we are hurting on the investment front in many of these different areas. So that is definitely a concern. You go back to the taxes. I mean, I can see why we want to take in money from other people. and redistribute to those struggling and support our social services. I very much am that way. But when you add personal income taxes to what's happened with property taxes, we have, of course, a goods and service tax.

You add it all together. We're a very highly taxed country. There's no question. So, you know, when we talk about productivity, we talk about inflation, these are things that fascinate me. I read on economics tremendously. But for the viewers out there and for the readers of the wealthy barber, it's important to recognize you can't do anything about that.

We don't control Canada's productivity, Canadian government policy. We don't control the inflation rate. You have to focus on what you can control. So you're reading books like the wealthy barber you mentioned Brandon and some of his videos, etc. You're trying to learn how do I save a little bit more. When I do save, what's the most effective account to put it in? What's the best place to invest that over the next 20 and 30 years to help me get that growth? Focus on learning the details of what you can control, even though the rest of it's fascinating. And you and I obviously love it, we chatter back and forth about it, we can't control it. And so it's key that people take what they can control

in the world of personal finance and do their best there to make sure they're on the right paths. Fantastic. Just one more question on taxation. I'm just curious, when you think about that system, the other piece that I find fascinating was in, I think it was in the 1950s. They had decided to start removing the money from people's account

before they actually had it go into their account, right? like it comes out automatically before they even have a chance to touch it. And that's often the rule we try and tell people when we're talking about financial literacy for saving is just put it away, give it to yourself for the future and have that approach. And I just wonder from your perspective, just as a broader person who thinks about finances, what you think the ramifications would be if we were expected to pay our taxes on April 1st and set that money aside rather than having it removed every paycheck, by the government on those fronts because I think that would just change our relationship with government, our relationship with our own money when you really saw that money going out the door. Yeah, it's interesting. Certainly it would make it, as you say, more visible.

And therefore, we may understand more exactly how much we're taxed to make us think all of this through. So they're positives. It's never going to happen though because, of course, it's always going to come off as we go. But you mentioned something in the preface question about taking the money off the top of the paycheck on the saving front and how pay yourself first has been embraced. One thing I can tell your audience for sure. There's no question about this. That is still the most important commandment in personal finance by a factor of 10. In fact, Rob Carrick, the famous Globe male personal finance reporter, said recently, it's the number one most important thing. And number two and three are a distant

two and three. If you look at people who've handled their money well, whether they come from a modest income or they've tended to be quite affluent on the income front, they've taken the money off the top of the paycheck or direct out of the bank account before a human nature had a chance to get involved. If you rely on self-discipline to save and making it, oh my gosh, nobody can do that. Just get it out of there, get it into your RSP or TFSA or FHSA, whatever you're doing, automate as much of this as you can. You'll suddenly stop missing the money. You'll move forward with your life. So pay yourself first remains key. Your idea as applying it to taxes and all those types of things is interesting.

And I think would be a very good experience in terms of actually recognizing how much is departing to go. But again, I don't think we're ever going to see it. Okay. Last question. I'm mindful of your time. I really like how you started, which is giving people motivation, giving them hope. Because right now, I think Canadians backs are against the wall. We have inflation.

We have high taxes. We don't have the social services that are making the same impact because government money isn't going as far as it was going previously. And so we're up against it. And I'm just wondering what gives you hope, what gives you inspiration about the next generation and where you think means that. You know, it's a really interesting time right now in that when you look at the surveys, but even when you just base your conclusions on casual conversations, people kind of 50 and up seem to be in quite good spirits. You know, real estate's treated them quite well. The markets have been fairly strong. they're headed towards retirements. It's been a relatively good time in the Canadian economy.

Younger people are not happy right now. They're looking at the cost of real estate. They're threatened by AI for sure. They feel the boomers and the older people have not paid enough attention to their needs, have drawn too many resources. There's almost this great divide where the happiness of the younger people is very different than it is of the older people. I see it all the time. When I did the pre-research to re-wrake the wealthy barber, I ran into that day after day after day. And again, you've nailed it. A lot of it comes down to hope. When people feel that they're not going to be able to buy that home, they don't want a dramatically fancy home, they want something to raise a couple kids with that have a dog, have a cat, whatever. They feel they're not

going to be able to get there. Frustration sets in, unhappiness follows, etc. I get that. But there are lots of reasons for optimism, honestly. Canada remains a country governed by the rule of law. It remains a peaceful country. Obviously, a beautiful country. We have a balanced. multiple resources, striking the right balances in terms of getting out of the ground and being fair to all constituents involved and also being fair to the environment, that's not easily done. But there are solutions going forward. I think we'll come up with all kinds of innovations in the next 10 years that help us get resources out of ground, but don't harm the environment very much. I think you'll see a lot of innovation in that space. You mentioned earlier another reason for

optimism. Never been a better time to be an entrepreneur. There are so many inexpensive tools that people can apply to whatever business idea they have, that can do some very wonderful things too. But as I talk about these positive things and I am by nature very optimistic and I try to motivate young people, I am respectful of the challenges. I look at the costs of real estate, the costs of rent. I understand why people are frustrated. And again, a lot of comes back to what we talked about earlier. We need productivity growth. We need more business formation. Those two things to me are absolutely crucial to setting the tone for improvement in Canada going forward. How do we do that? What policy changes are needed? That's a key thing we all have to look at,

especially at the government level, of course. How can people find your book and follow your work? I've been loving the shorts. I'm playing them at the beginning of our finance and audited meetings for our nation and just really appreciate the work they're doing. How can they find it? At the Wealthy Barber is our handle on everything, Instagram, Facebook, etc. The shorts have gone over great. We have mains and millions and millions of views a month. For personal finance, shorts, Canadian-only content. So, I mean, I think we've been caught off guard.

Then the Wealthy Barber podcast like yours is available on YouTube, although most of our listeners are on Spotify and Apple. We tend to have audio-only listeners. I don't think they want to see my face. We're quite insulted by the fact that the YouTube audience is small, but the other two audiences are big. So I think that, again, they're staying away from my looks. And, of course, the wealthy barber is at Indigo and independent bookstores.

across the country. You'll find it interesting. We did not distribute it with Amazon and Costco our second and third biggest accounts with the previous books because I wanted to keep all of the profits here in Canada. So we were within to go Canadian owned and independent bookstore is Canadian owned and a lot of people thought that was a peculiar thing to do in terms of profitability. But I'm really, you know, pro Canada. I've always lived here. I'm not moving. A lot of people say, ah, people are going stateside. They want to save tax, etc. I'm in Canadian. Proud Canadian. happy to be here and hopefully it could be a part of the solutions to the problems that you've brought up. David, I do want to end on that point, which is, I of course follow Dave Ramsey as well.

And I think no better contrast is shown between his approach and your approach. He has very, I would say, a bombastic USA approach. And you have a very Canadian, gentle, respectful, thoughtful, reflective, mindful of how the information is going to be received approach. And I just, as we think a lot about Canadian values and what does it mean to be a Canadian, what makes us different than our neighbors down south, I think you embody that through financial literacy versus Dave Ramsey. I find when we were looking at trying to educate our First Nation community, you're the guy, because you're the person who doesn't smack people around in YouTube videos, bullying them about how they messed up. You're trying to meet people where they're at. And I think there's a beautiful essence to how you wrote the book and,

and the spirit of even the individuals, like I think your values come through in how you've created those characters and they're very gentle and thoughtful and caring and wanting their neighbor to succeed, which I do think is really Canadian and reminds me a lot of my favorite show, Corner Gass, where we're a small town people,

like at our core, we're a small town people who want to help our neighbor succeed. And I see that in so much of the work you do. And again, just reading your book when I was a kid and then in my teens and then now trying to share with a broader community, your idea of trying to pass this on and make sure others to succeed, I think really resonates with me and I'm sure with others to want to make sure

everybody has a fair shot at having enough money in their account. So they're not worried about the groceries. And I think you've had a huge impact on Canada and on Canadians. And I just have a great deal of admiration in respect to this. Well, it's nice to be to say all that. And I really enjoyed today. And congrats on the success of the podcast. And much more importantly than all that, good luck at the wedding.

Thank you. Yeah, that'll be a lot of fun. So congratulations on that and keep me informed. I'm happy to come back on any time. And thank you for all the kind words. Beautiful. Well, thank you again. And we will do this again.

Thank you.