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He is featured in many publications, including The Globe & Mail, Money Magazine, Private Investor and has his own TV show called \u201cWe Talk Money:\n\nIn the interview, they cover the following:\n\nWhat Is The Big Secret To Financial Success?\nIs A Formal Education Required To Do Great Things Financially?\nThe #1 Thing You Need To Do To Improve Your Finances.\nRich Is A State Of Mind.\nSaving Money When You Live Paycheck To Paycheck.\nWhy Are People Afraid Of Money?\nWhat Does \" Being Rich\" Mean?\nIs Saving A Punishment Or A Reward?\nThe 7th Wonder- Compound Interest.\nSMART Goal Setting.\nPay Yourself First.\nRRSP's and TFSA's.\n\nContacts:\nRobert Gignac\nSpeaker, Writer and Author\n(905) 841-0837\nrobert@robertgignac.com\nhttps:\/\/robertgignac.com\n\nA highly sought after speaker who combines knowledge, passion and visuals to encourage people to take control of their personal finances to have a \u2018Richly Imagined Future.\u2019 Author of the book \u201cRich Is A State Of Mind\u201d\n\n\n Richard Killen & Associates Ltd Scarborough West\n https:\/\/www.g.page\/killenscarboroughwest\n Licensed Insolvency Trustee and Licensed Consumer Proposal Administrator\n 2130 Lawrence Ave, E  #402, Scarborough, ON M1R 3A6, Canada\n Tel: +1 416-285-9511\n https:\/\/rkillen.ca\n Personal bankruptcies, consumer proposals and debt counselling. \n Contact Richard at for a fresh start (888) 545-5365\n This may be the most stress-relieving call you will ever make!\n\nRichard Killen and Associates have 10 locations across the Greater Toronto Area.","thumbnailUrl":["https:\/\/i.ytimg.com\/vi\/MtamkI2HIsE\/default.jpg","https:\/\/i.ytimg.com\/vi\/MtamkI2HIsE\/mqdefault.jpg","https:\/\/i.ytimg.com\/vi\/MtamkI2HIsE\/hqdefault.jpg","https:\/\/i.ytimg.com\/vi\/MtamkI2HIsE\/sddefault.jpg","https:\/\/i.ytimg.com\/vi\/MtamkI2HIsE\/maxresdefault.jpg"],"uploadDate":"2020-02-07T16:45:49+00:00","duration":"PT36M27S","embedUrl":"https:\/\/www.youtube.com\/embed\/MtamkI2HIsE","publisher":{"@type":"Organization","@id":"https:\/\/www.youtube.com\/channel\/UCBnlR4W4vfP3HN-fTV8pH8g#Organization","url":"https:\/\/www.youtube.com\/channel\/UCBnlR4W4vfP3HN-fTV8pH8g","name":"The Glass is Half Full","description":"Richard Killen is a Licensed Insolvency Trustee who has seen first hand many people struggle with debt and the stress that financial problems generate. Many families are living paycheck to paycheck and this weekly show is all about helping people in this community with little or no money to do more with less.\n\nIn this show, Richard and his guests will share their expertise and share their stories. Some topics may include:\n\nHow to get out of debt\nHow to reduce stress caused by financial problems\nHow to buy products and services for less\nVarious ways to save money\nHow to enjoy life and have fun with little or no money.\nInexpensive vacations\nPeople sharing stories on how they overcome obstacles\n\u2026 and endless other topics\nThe show is an interview style talk show that is filmed locally in Toronto or via Webinar for guests that are from outside of Toronto.","logo":{"url":"https:\/\/yt3.ggpht.com\/ytc\/AIdro_nNWVcqPrZwGj4XwfnZ4zMT-Dm31Nb9WA0WhjYioTpT2A=s800-c-k-c0x00ffffff-no-rj","width":800,"height":800,"@type":"ImageObject","@id":"https:\/\/www.youtube.com\/watch?v=MtamkI2HIsE#VideoObject_publisher_logo_ImageObject"}},"potentialAction":{"@type":"SeekToAction","@id":"https:\/\/www.youtube.com\/watch?v=MtamkI2HIsE#VideoObject_potentialAction","target":"https:\/\/www.youtube.com\/watch?v=MtamkI2HIsE&t={seek_to_second_number}","startOffset-input":"required name=seek_to_second_number"},"interactionStatistic":[[{"@type":"InteractionCounter","@id":"https:\/\/www.youtube.com\/watch?v=MtamkI2HIsE#VideoObject_interactionStatistic_WatchAction","interactionType":{"@type":"WatchAction"},"userInteractionCount":27}],{"@type":"InteractionCounter","@id":"https:\/\/www.youtube.com\/watch?v=MtamkI2HIsE#VideoObject_interactionStatistic_LikeAction","interactionType":{"@type":"LikeAction"},"userInteractionCount":1}]},"about":["Credit","Financial Advice","Interviews","Videos"],"wordCount":6366,"articleBody":"The Big Secret Of Financial Success with Robert GignacWatch this video on YouTubeIn this episode of The Glass Is Half Full, Richard Killen a Licensed Insolvency Trustee interviews Robert Gignac, a speaker, writer and author talk about The Big Secret Of Financial Success. He is featured in many publications, including The Globe & Mail, Money Magazine, Private Investor and has his own TV show called \u201cWe Talk Money:RichardHi, I’m Richard Killen. Welcome to a very interesting show we hope we have for you today on The Glass Is Half Full. We’re joined by Robert Gignac, am I getting it right, Robert?RobertPerfect, Richard. Thank you.RichardGood. Today we’re going to\u00a0learn about the big secret of financial success, right Robert?RobertYes. Absolutely.RichardRobert is a very, very highly sought after speaker who combines knowledge, passion and visuals to encourage people to take control of their personal finances and to live what you call a richly imagined future, right?RobertAbsolutely.RichardRobert delivers\u00a0keynote speeches and interactive workshop programs to\u00a0International organizations, financial industry and private clients,\u00a0right? He\u00a0also featured in many publications, including the\u00a0Globe &\u00a0Mail, Money\u00a0Magazine, Private Investor and you\u00a0have\u00a0your\u00a0own TV show on,\u00a0what\u00a0is\u00a0it? We TV?RobertWe TV?RichardWhat’s it called?RobertIt’s called We Talk Money,RichardAnd,\u00a0one of the more interesting things, if you think anything is more interesting than TV, is that you’ve written a Canadian bestseller called Rich Is a State of Mind.RobertI\u00a0did, accidentally by\u00a0chance. I did. I’d never intended to write a best selling book on personal finance. I was trying to help a friend create a marketing brochure.RichardSome of the best things come from things like that?RobertAbsolutely.RichardWell, I’m going to\u00a0get back to your book\u00a0in\u00a0some depth little later on Robert. I personally found it very interesting, but I’d liked to ask you,\u00a0you spend\u00a0a great deal of time\u00a0speaking to Canadians about concepts of personal finance and taking control of their financial future,\u00a0and I’m sure you’re often asked, what is the big secret\u00a0to\u00a0financial success?\u00a0So what is the big secret?RobertI get asked that a lot. And people are generally incredibly underwhelmed with the answer, which is that there’s no big secret. There’s\u00a0no magic pill, there’s no silver bullet. There’s no one thing that if I only knew what that one thing is.\u00a0What it is, is with many things in life,\u00a0it’s a\u00a0series\u00a0of small, little, incremental things that we do over and over and over that allow us to get better with whatever it is, including managing our personal finances. If I were to pick one thing and I was asked this recently in an event because the person was adamant that there must just be the one thing it would be this, marry the right person and stay married. That would be the one thing, right? If anybody’s ever been through an asset-ectomy,\u00a0i.e.\u00a0divorce, and lost half their assets,\u00a0it’s a huge impediment to being successful financially and the….RichardNot to mention\u00a0being a bit of an emotional\u00a0letdown.RobertA huge emotional letdown and lots of other issues to deal with there,\u00a0but If people are looking for that one thing, they’re going to be really disappointed to find out that there just isn’t that one thing.RichardSo essentially you brought marriage counselling to\u00a0the table?RobertNo, absolutely not. But at the end of the day,RichardIt’s important.RobertIt’s important and it’s important that we do a number of things better than we’re doing today to have a better future\u00a0tomorrow.\u00a0There’s a line I’ve heard that I like that said, If you’re willing to do the things today that other people won’t, then tomorrow you can have the life that other people won’t be able to have. If you’re willing to do those things today.RichardBut it has to be today.RobertBut, if not today, certainly tomorrow or next week because we\u00a0all\u00a0believe we have huge, vast amounts of time at our disposal.RichardEspecially when we’re young.RobertWhen we’re young,\u00a0certainly. When\u00a0you’re 25 the concept of being 50 seems ancient, right?RichardIf\u00a0you think about it at all.RobertIf you think about it at all. But we think about it because we look at our parents and we look at our grandparents and we go,\u00a0yeah, I’ll\u00a0get there, but I’ve got lots of time.\u00a0And the reality is that time disappears before we know it.RichardYou wrote an article called, It’s Possible, and in that article you talk about giving a speech,\u00a0I guess\u00a0it\u00a0is,\u00a0to a group in Timmons, I think\u00a0it is, on the subject of, you call, richly imagined\u00a0future. I understand that\u00a0an audience member commented,\u00a0confronted you if you want, to go with\u00a0his own\u00a0thought on the matter, saying, basically that this was all well and good for you, but there’s no way that it’s going to\u00a0be possible for him. Can you explain what happened next?RobertSo it was during\u00a0the Q and A portion, and the gentleman came up and he said,\u00a0“he\u00a0thoroughly enjoyed the presentation”, he said,\u00a0“but this\u00a0concept that you talked about won’t work for me”. And I said,\u00a0“Okay and tell me more?”, because that’s always my favourite question to\u00a0someone.\u00a0Tell me more and\u00a0he said\u00a0“well, you don’t understand. I just have a high school education. I never went to university.” That’s great.\u00a0He said,\u00a0“why is that great”? I said\u00a0because too many people confuse education with the ability to do better things with money. You don’t need a university degree to do great things with your personal finances. The fact you didn’t go to university is great If you had gone, sure, that’s nice. But don’t let the fact you didn’t go to university determine your financial future, and I drew his attention to a quote that I had put up during the presentation by a British entrepreneur named Brad Sugars. And the quote, I use it all the time, is the quality of your life is determined by the decisions you make, which is determined by the questions you ask, which is determined by the quality of your education. But don’t confuse that education has to come from a school system. It comes from the books we read, the things we watched, the people we associate with, and as long as we’re willing to learn something new and change your behaviour, then we get educated. When we’re educated, we ask better questions. Those better questions could be to financial professionals, the peers around us, and when we ask better questions, we make better decisions. And that’s what determines how successful we’re going to be. Not whether or not you went to University, college or even graduated high school.RichardIn\u00a0fact, some people will say that your education only really starts when you leave school.RobertOh, absolutely, But, many leave\u00a0the educational sphere, and I’ve actually heard people say this when they were done with school,\u00a0it’s like,\u00a0“Oh, thank God I’m done with that,\u00a0now I don’t have to read any more books.” No, reading books is excellent. It’s\u00a0a phenomenal way to gain\u00a0the education to help you do better things.RichardYou could be describing my father, who had\u00a0a 7th-grade\u00a0education, but it was possibly the, certainly the\u00a0most everyday man I’ve ever known.RobertThat’s great.RichardBut he read a lot, quite a bit.RobertIt’s important.RichardCan I ask you? People are always looking for,\u00a0easy or shortcut answers to think about that. I’m gonna see if you can provide one here. What is the biggest single thing that somebody can do to improve their financial situation?RobertIf I were to boil it to\u00a0one thing, Richard, I’d probably boil it to\u00a0one word. And the word is no. It’s a word that most people in today’s day and age or incredibly unfamiliar with because they’ve never said no. They’ve never had no said to them. Sometimes\u00a0as parents we don’t say it enough to our kids. Right?\u00a0Can I have the new Xbox,\u00a0XYZ\u00a0killing video game?\u00a0No. Do I want to go out and buy a new Lexus GS450? Yes, but no. Because the more often we say no to ourselves, the more successful we will be in the long term. That doesn’t mean I’m against spending money. Spending money is a great thing, right? We work hard. We earn\u00a0money. We should spend some and enjoy what we’re doing. But the reality is, the more often we say no and delay the gratification, the more successful we can be with our finances.RichardYep. I’d like to talk to you a bit\u00a0about\u00a0your bestseller,\u00a0Rich\u00a0Is\u00a0A\u00a0State\u00a0Of\u00a0Mind,\u00a0right?\u00a0Just a comment\u00a0I’d like to make about the book,\u00a0is I found it very interesting that you wrote it is a novel instead of the usual how-to-book, which is almost a manual,\u00a0right?\u00a0You have very good writing skills,\u00a0I’ll tell you that.RobertThank you.RichardWhen I was reading it, I found that I was,\u00a0it was a\u00a0page-turner.RobertWhen it comes to books on personal finance, I’m flattered to hear that.RichardAnd that’s the thing that impressed me the most on it, is that it is very thorough, but because it had it was a novel,\u00a0had a plot, storyline, characters, that you get involved in, personalities if you want. But using that as a vehicle, what you did is, you\u00a0brought in everything that I could think of it as a factor in personal finances, personal finance\u00a0management, everything from how to save to the effect of inflation on things and what not? And because\u00a0you\u00a0wrote it as a novel, it all started to kind of make sense. It was explained and explained\u00a0in a\u00a0very, very easy,\u00a0to, understand way.\u00a0I think anybody could read that, you don’t\u00a0have to be an MBA to be able to understand.RobertOh, and absolutely. And one of the things I tried to do with the book when I picked this format, is I knew if I created a personal finance book that read like a high school or\u00a0university textbook, nobody\u00a0would read it, right?\u00a0But, if I could craft a story of a slightly dysfunctional Canadian family trying to come to grips with everything related to personal finance, if I was lucky, I could create characters that people would read the book and go,\u00a0“That’s exactly how I feel.”\u00a0Or that’s my kid sister. That’s my older brother. And if I could do that, then maybe I could keep them turning the pages in order to actually get from one point to the other. There is an email that I received from a reader of the book that I keep posted in my office, right\u00a0on my filing cabinet. I can see it every day, and it was a reader, who said\u00a0“Robert,\u00a0there’s one thing I needed to tell you about your book. I own many books on personal finance. Yours is the\u00a0first\u00a0one\u00a0I actually finished, and I was so grateful to see that, that it’s in a\u00a0prime spot where I see it every day.RichardWell, I’ll send you an email that says the same thing.RobertThank you.RichardI want to ask a few questions about\u00a0the content of the book, the\u00a0thing\u00a0that you discussed,\u00a0if you don’t mind?\u00a0In it, you talk about the importance of saving. That should be obvious to anybody that if you want a plan for your financial future, it’s going to\u00a0incorporate an element of savings, and it has to be released. But for somebody living paycheck to paycheck, it’s really hard to see how you can do this. And I know in the book, you do deal with that eventually and so on. But maybe you could talk a little bit about that now.RobertOne of the things that is difficult for all of us to grasp, is that if we want a better or different tomorrow, then we have to do different things today. And as it relates to money that generally the first basic building block is saving money, spending less money than you earn. Now there are a number of different ways,\u00a0we can attempt to do that, but at the end of the day, taking that first step saving dollar one or dollars one through five can be a significant challenge in today’s economy, and but at the same time there are some simple things we can do. I think that will help us along that path. So, for example, one of the examples I used in the book if any of us were to go through a salary reduction if our employer came along and said sorry\u00a0times are tough, we could keep the business open. But we’ve got to reduce everybody’s\u00a0salary by 5%. Our first reaction generally wouldn’t be,\u00a0“Hey, I’m out of here, and I’m looking for a new job”\u00a0it would\u00a0be like,\u00a0“Wow, this really sucks. But okay, what do\u00a0I\u00a0do now?” And one of the things I encourage people to do is\u00a0if you’re having problems saving dollar one pretend you just got a 5% reduction\u00a0in\u00a0pay. You get to spend\u00a0all the rest,\u00a0but that 5% has to be set aside for things that you’re going to do in the future. And while you’re doing that, you may go look for a new job. You may create a side hustle that brings in a few extra dollars. There’s a number of things you can do on that front, but it’s taking that first step,\u00a0that is the most critical piece, Richard.RichardAnd by essentially treating it as a\u00a0fait accompli,\u00a0where the thing is done,\u00a0you\u00a0just don’t have that 5% anymore, right?RobertAnd,\u00a0put that 5% in a bank account that’s not linked to your debit card, because we all know what it’s\u00a0like. You’re out on Saturday\u00a0night, you’re\u00a0out\u00a0with some friends,\u00a0it’s like, I need\u00a0$50,\u00a0wait a sec,\u00a0I’ll take it out now and I’ll put it back in on Tuesday. No, it’s not going, it’s gone. So make sure that it’s in an account that is not easily accessible.RichardDidn’t Wimpy buy his hamburgers like that?RobertSort of like that. So, yeah, I’d gladly pay you next week for a burger I can have today.RichardThat’s right.\u00a0Mind you, that showing my age, you’re not supposed to have heard of them. You say in the book that people, everybody’s interested in money, I find that fairly easy to believe. But you also say that people are afraid of it.RobertThere’s a lot of emotion around money, and it’s not just a Canadian thing. I think it’s more of a global thing. That money tends to make us feel like we’re not successful. I tell people all the time. Money is a crappy way to keep score in life. But the reality is for many of us, it’s the only way we’ve got to keep score or we think we do\u00a0because we’re always comparing\u00a0ourselves\u00a0to others. We compare ourselves to the people we live next door to. People were related to, the people we work with, and we’re always critical of people who look like they have more money because we wonder, what did they do to get this money? Was it illegal or immoral or some other thing? Or somehow, if I don’t have enough money, however much that is, then somehow I have failed and done something wrong.RichardWould that be because, like it or not, money is one of the very, very few objective things which we can measure things?RobertIt\u00a0is.RichardHard to measure how\u00a0much love you are receiving or giving?RobertAbsolutely. When you know it’s numbers, it’s paper. We write it down, we add it\u00a0up, we divide it and we can see it in black and white. But the emotion that goes along with that is where most of us get pretty messed up\u00a0as it relates to the money.\u00a0And it’s where the fear comes in because we always think we’re not good enough. And what\u00a0if I don’t measure up?RichardIf I can’t do it?RobertBut the thing that I always tried to caution people is when you’re making that comparison, make sure that you’re comparing reality to your reality. So, you know, in the age of social media, I try to convince people all the time. Social media\u00a0is not real,\u00a0so when you’re seeing your neighbours or your cousin vacationing in….RichardSo what\u00a0President Trump says all the time is not real?RobertUh, no, I know. But the reality is when we see people we know vacationing in Mexico or they\u00a0stand beside a new car or we go like,\u00a0holy\u00a0crap, they’ve got it all figured out. They never post the picture of them on social media at\u00a02:45 in the morning, curled up in the fetal position in bed,\u00a0can’t sleep because their visa bills due Friday and they don’t have the money? No. They post the picture of their meal dining out, or a sporting event or on vacation, and their life looks great. We then feel bad about ourselves going,\u00a0“Why can’t I do all of that?” Well, we could. We just have a different plan.RichardSo, Robert, you talk about the word rich. It’s in the title of your book,\u00a0right?RobertIt’s in the title.RichardBut you have a very interesting definition of the meaning of that word.RobertWell, rich means different things to different people. And if you do look it up in the dictionary and I know the younger viewers watching go, what’s a dictionary? If you look it up, the very first Google, very first definition has to do with depth of colour, and\u00a0hue\u00a0has nothing to do with money until you get down to the fifth or sixth definition. I chose the title,\u00a0Rich\u00a0Is\u00a0A\u00a0State\u00a0Of\u00a0Mind, because nobody could tell me what rich is or was to them. They didn’t, they quote me a dollar figure. They didn’t say it’s\u00a02,738 something. But they told me how they would feel, what their life would look like, who they’d spend their time with, if they ever answered the question,\u00a0yes. Which made me think that it’s really a mental thing. It’s how we feel, not what the balance of a\u00a0bank statement or mutual fund\u00a0statement says. And the characters having the discussion in the book about the concept of the word rich, Richard, the mentor in the book, went to the\u00a0whiteboard.RichardVery good name.RobertHe wrote down one word. Freedom. Now,\u00a0it was interesting that he chose that word because the other characters in the book in that discussion were freedom\u00a0from what? And Richard just kind of smiled and said,\u00a0“Not freedom from, freedom\u00a0to.\u00a0Freedom to create the life you want, spending time with who you want to spend it with, doing things that bring you enjoyment, not freedom from something.” And when we look at money is the ability to provide experiences in our life, then I think we get a much deeper appreciation for it.RichardIn your book,\u00a0you’re also, by definition, if we’re talking about building a better financial future for\u00a0ourselves\u00a0we’re going to be eventually talking about saving money.RobertYes.RichardAnd in the process of that,\u00a0discussing that in your book, your characters mentioned that, for most people, perhaps, saving is seen as a form of punishment, where you deprive yourself.RobertIt’s denial.RichardSpending. Yes,\u00a0denial.\u00a0And spending is a form of reward.RobertYes.RichardYou don’t agree with that?RobertI don’t agree entirely, because what happens is sometimes we get things reversed when we need to do better things with our money. Saving is actually the rewards side and think of spending\u00a0it is a little bit of punishment because we’re\u00a0destroying the wealth we’re creating\u00a0by doing so.\u00a0Now, we\u00a0all need to spend money, right?\u00a0We\u00a0have to pay rent. We have to\u00a0buy gasoline for a car and a metro pass and some groceries. All of these things. But the end of the day is we’re trying to plan a\u00a0long-range\u00a0financial future. The savings aspect is actually the reward that we’re going to get later. But in today’s day and age, the concept of delayed gratification doesn’t exist. Where\u00a0those who came before us? My parents, my parents before them? You didn’t buy things if you didn’t have cash in order to pay for it, you\u00a0save money for a rainy day. You waited until you could afford to do something. But in today’s day and age where we have this kind of frictionless spending, you know, he used to be with a credit card used to make that noise, like when they actually ran your card. Now it’s tap and\u00a0beep, the money’s gone, right?\u00a0We don’t have any physical relationship to it. And that’s what I think messes us up about money today.RichardWell, you’re not going to\u00a0get any argument from me. I’m an\u00a0Insolvency\u00a0Trustee,\u00a0as\u00a0you know Robert,\u00a0and\u00a0the whole concept of credit cards,\u00a0although it has had a very positive effect on this overall standard of living, the economy in general, the size of the economy andRobertAnd there are people who use credit cards\u00a0very well.RichardIn fact, probably the majority.RobertI think the majority do.RichardBecause\u00a0it’s\u00a0not the majority that to come and see me. But in any case,\u00a0I have to\u00a0agree completely with you.\u00a0What you’re talking about\u00a0there is essentially the difference between\u00a0short-range\u00a0thinking and\u00a0long-range\u00a0thinking, right?RobertYes.RichardSo the\u00a0idea of\u00a0instant gratification is that you can’t see beyond right now.\u00a0A child thinks that way. He sees that he wants that and so on. Where, as an adult is supposed to come along and say,\u00a0“So I don’t know. What am I gonna have to give up next week or next month or next year toRobertRight, and we can do a\u00a0pro and con list if you want. If I do this today, what can’t I do tomorrow? If I’m willing to forgo this today, what will I be able to do tomorrow? And it’s that kind of\u00a0decision-making\u00a0process that hopefully allows us to make better decisions financially.RichardAnd it\u00a0kind of leads into my next question, which is you’re referring to savings as something that is essentially, it has become a habit for it to be effective, basically or if you want. If you can get into the habit of doing it, it will really pay dividends.RobertAnd\u00a0it’s the habit that drives us from a financial perspective. But we get into habits all the time, both good habits and bad habits. But when we’re trying to start that saving money process for somebody who’s always struggled with it, or never, ever saved a dollar, saving dollars, one through five is the beginning of a habit, and we do it this week and we do it next week to do it the week after,\u00a0and\u00a0the week after that and the lot more we do that, we ingrained the habit,\u00a0it becomes second nature, and then we don’t even have to think about it anymore. It just happens.RichardAnd in your book, you essentially saying that the way to look to achieve this, when\u00a0you move into this is to start small. So you use the example,\u00a0one of my favourites that I think I learned when I was about 13 years old or something,\u00a0I don’t know why, but I learned it, that little example,\u00a0we’ll call it that of the value of a penny,\u00a0double daily?RobertYes.RichardNot one cent double daily?RobertRight.RichardThe value of a penny double daily. So if it doubles tomorrow, you got two pennies, now double two pennies,\u00a0you’ll have four. So by the end of the month, how much money do you have?RobertYou have approximately $2.7 million now, realistically, there is no investment out there in the world.RichardBut when you tell me where that was.RobertThat will do that for you. But the reason I used the example in the book is to get the characters understanding the concept of time and compound interest in order to help your savings and investments grow over time.RichardAnd compound interest is what you call?RobertThe Seventh Wonder of the world. And I didn’t I guess, seventh or eighth\u00a0right, depending on your perspective, that\u00a0you know. But the reality,\u00a0I didn’t think that it was some guy named Baron de Rothschild’s in this 1800’s who eventually coined that phrase. But if you don’t start saving dollar one today, then 38 late days later or 38 months later or 38 years later it won’t matter. You will have lost that time and compounding opportunity in order to make your personal finances better.RichardI think you mentioned in your book that if used the example, that if a\u00a020-year-old,\u00a0give or\u00a0take, is able to save $2000 a year and does it only for 10 years and stops saving at that point but allows it to compound at whatever rate of interest, whatever rate of compounding. But just to keep things simple, we’ll use 10% which is way higher than what you’re going to\u00a0get today, probably on average,\u00a0but for the sake of the example,\u00a0that 10% how much money is a person had by the\u00a0time they are\u00a065?RobertApproximately $1.2 million.RichardAnd all\u00a0they’ve saved his $20,000.RobertRight.\u00a0But if their friend, who says I’m not going to\u00a0do this from the time I’m 20 to 30, I’m going to start when I’m 30\u00a0and they save that same $2000 a month for 10 years for all the way to 60RichardOh, all the way.RobertFor the next 30 years, they will still not catch up to their friend, who started earlier and stopped.RichardIt’s pretty graphic.RobertIt’s the value of time.\u00a0Now to a\u00a0viewer or listener to the podcast, they may go,\u00a0I’m 48 years old,\u00a0I’m screwed because I’ve never saved\u00a0dollar one. No.\u00a0Start now.\u00a0The best time to have planted a tree in your backyard if you want to sit in the shade is 35 years ago. The second best time is today, because if you don’t do it today, 30 years from now, you’re still not going to\u00a0have any shade to sit under. So it’s\u00a0the point where, regardless of where you are in that spectrum, if you’re 22 and starting it, great.\u00a0If you’re 32\u00a0and starting it,\u00a0great. If you’re 42 and starting it, great.\u00a0The key is you have to start.RichardAnd along with that starting, goes\u00a0the idea of goal\u00a0setting, isn’t\u00a0it?RobertGoal setting isRichardStart,\u00a0but start what? You can’t just flail around?RobertNo youRichardI mean you could, I suppose.RobertYou could.RichardBut it’s not smart.RobertBut goal\u00a0setting is\u00a0important because it’s what in many cases drives our behaviour in the decisions we make. Why are we doing this? Because I want to accomplish X Y and Zed.\u00a0“X” in the next year,\u00a0“Y”\u00a0five years from now and Zed 10-15 years from now. But without those mileposts out for us to work towards, we don’t see the reason why we are doing this in the first place? So we need to get very clear about that.RichardKeeps us on point. And\u00a0keeps us\u00a0essentially on\u00a0target.RobertAnd one of the cool things that happens about goals is once you start crossing them off the list, you get incentivized to go, cool,\u00a0how do we get more of these? Well, then we create more of them, and we keep trying\u00a0to accomplish them.RichardI’m going to throw an acronym at you, Robert,\u00a0you may have heard of it before because it’s in your book. Smart. S\u00a0M\u00a0A\u00a0R T. Tell us what that is?RobertIt stands for specific, measurable, achievable, realistic and\u00a0time-based. It’s the I’ll say, the backbone of goal\u00a0setting. Everybody talks about goals,\u00a0talks about this, and what it is creates a structure for you to set goals. Your goal has to be specific. I’m going to lose\u00a036 pounds. It has to be measurable. Already had measured that when you get\u00a0on a scale\u00a0every once in a while, is it achievable? Well, it depends on your time frame if you said by the end of the calendar year, but we’re already in October,\u00a036 pounds in a month and\u00a0a half,\u00a0may not be really may not be achievable or\u00a0realistic?RichardGive up eating.RobertWell, exactly.\u00a0But,\u00a0then here’s what happens. We give up eating for like, three days, and on\u00a0day four, we head to Tim Hortons for a couple of you know, sour cream doughnuts\u00a0and\u00a0a large double-double because after three days we have, we’ve committed ourselves to fail by not setting a realistic goal.RichardSo\u00a0that’s what\u00a0SMART\u00a0is?RobertYes.RichardOkay, now you also mentioned something else. I’ve heard this before, but missed to see it in your book, nice\u00a0to be reminded\u00a0of it,\u00a0the phrase called, Pay\u00a0Yourself\u00a0First.RobertWhen we think about the concept of money and saving dollar one, we have to, particularly for those of us who get a regular paycheck from an employer,\u00a0take the money right off the top. So if you received $500 that week, is your paycheck the first X amount? Whether it’s\u00a0$5,\u00a0$10,\u00a0$50 or\u00a0$100 goes right off the top.\u00a0You don’t see it. You don’t get it. You can’t spend it.RichardYou don’t put it into the same account that you’reRobertExactly. It goes into that\u00a0account not linked to any of your debit cards, so that you have no access to it without maybe physically going into a bank branch in order\u00a0to do it.RichardSo this is a bit of takeoff on something you said earlier about, we’re talking about pretending that you have a 5% pay decrease.RobertRight.RichardBasically, you’re paying yourself that 5%\u00a0first.RobertRight, and that once you do that the rest of the money you get to spend without ever worrying about it. The problem is, many of us try to do the reverse. How much money do I\u00a0make? Here’s my bills, add\u00a0all the bills up, and we draw that big line, say, I’ll save what’s left.RichardRight.RobertThere’s none left.\u00a0Because\u00a0our unexpected expenses and our ability to go and hang out with our friends on the weekend and only eat into all of that residual income and then the amount\u00a0at\u00a0the bottom\u00a0is zero,\u00a0I don’t have any money to save. No, take it off the top and once it’s gone, the rest of the money, go ahead and spend the rest of\u00a0the money. And I didn’t invent this phrase. I think it was the guy who wrote the book, The\u00a0Richest\u00a0Man\u00a0In Babylon, in 1904,\u00a0who actually coined the\u00a0Pay\u00a0Yourself\u00a0First.RichardNothing new under the Sun.RobertThere really isn’t.RichardBut,\u00a0are munificent\u00a0Government invented a couple of things for us, one\u00a0is called on RRSP\u00a0and the other one is called a\u00a0TFSA, registered retirement savings\u00a0plan, and\u00a0the\u00a0tax-free\u00a0savings account.RobertRightRichardNow, you’ve got some ideas on the benefits and, to some extent, the detriments, of\u00a0one against the other.RobertThere are, I think there are certainly pros to both. The\u00a0RRSP is thought of as a much\u00a0longer-term\u00a0vehicle for saving money. Because, you put money into the account, you get a tax break today, and then that income will be taxed back to you\u00a010, 15, 20, 25, 30 years out.RichardPresumably at a lower rate\u00a0because your\u00a0overall\u00a0income,RobertPresumably at a lower rate, because we make\u00a0hopefully a decent living while\u00a0we do that when we’re retired, our income falls. We’re taking money out,\u00a0it should be taxed less. It grows compounds over all that time. And then we can tap into that later. The\u00a0tax-free\u00a0savings account,\u00a0and I guess it’s a decade old now, so but it’s still relatively new in the grand scheme of things, allows us to put money away, and all of the growth has never taxed,\u00a0in that account.\u00a0We don’t get a tax break for contributing the way we do with the RRSP,\u00a0but all of the growth that occurs in the account comes out of it,\u00a0none taxed. I think, the one thing I wish they had given it a different name because they called it the\u00a0tax-free\u00a0savings account,\u00a0so we tend to think of it as a savings account, like it’s transactional. We put money in this week,\u00a0take it out two weeks now. Put money in next month, take it\u00a0out two months from now. It wasn’t designed to be transactional that way, and you can invest inside it and hold stocks,\u00a0mutual funds, ETF’s. It shouldn’t just be thought of as a savings account. Why? Because you can’t get compound interest when you’re only using, getting 1% on your money, using it as a savings account.RichardYeah, and not surprisingly, and not that many people are terribly converse in with what a\u00a0TFSA\u00a0is and how it works,\u00a0the way\u00a0you’re describing. A lot of people, maybe most people understand what they’ve been,\u00a0just a retirement savings plan,\u00a0because CPP is that there’s always talk about providing for yourself when you’re as you get older. Generally, some concern and anxiety that comes into play for probably most people that, what will they be able to live on?\u00a0Are they\u00a0going to be totally dependent upon CPP and OAS? Or will they be able to provide for themselves completely,\u00a0or maybe supplement\u00a0themselves?RobertAnd, do some Canadians have a pension plan? Some of it’s a defined contribution plan based upon what you contributed through your employer and automatic deductions and what they might match. Others are defined benefit, which is more of an older style, which my father had because he worked for the same company for 35 years. But, all of these things, to me, go along with having a conversation with a financial professional because there’s lots of decisions to make, lots of options to have, and sometimes it helps to have another person help walk you through the process. Here’s the pros and cons. You’ve got 15 options. How do we sort our way through that? Yet, sometimes we try to convince ourselves that, I’m smart enough to figure this out all by myself. And, yes, some people are smart enough, but, going right back to where we started this conversation, how you work with your personal finances, has nothing to do with how smart you are it’s how,RichardWhat education is.RobertOr what education you have.\u00a0It’s what are you willing to learn through the process to make better decisions?RichardWell, on that note, Robert, I think that wraps it up pretty good. You don’t have to be a PhD or anything like that to be able to manage your finances\u00a0well.RobertAbsolutely not. You just have to want\u00a0to.RichardAnd, I know a little bit about how,\u00a0and I can’t think of a better way for anybody to,\u00a0for anybody to,\u00a0find out how and to read your book,\u00a0Rich\u00a0Is\u00a0A\u00a0State\u00a0Of\u00a0Mind.\u00a0Rich\u00a0Is\u00a0A\u00a0State\u00a0Of\u00a0Mind.\u00a0And\u00a0highly recommend that anybody pick it up. Where can they get this\u00a0book?RobertThe best place to get a copy of the book is from my website, which is www.richisastateofmind.com. So it’s the book title,\u00a0just\u00a0as one word. If they’re interested in the other work I’m doing, It’s\u00a0robertgignac.com, and they both link\u00a0to each other."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"The Big Secret of Financial Success with Robert Gignac","item":"https:\/\/rkillen.ca\/the-big-secret-of-financial-success-with-robert-gignac\/#breadcrumbitem"}]}]