Hello everyone, a little rant today on the inaction of most (not you) Canadians and the impact it has on financial lives.

Eddie

So many people out there say they want to be rich.

They wish they had more money. And they go looking for advice.

Sometimes they come to me with questions, they ask for help (not sure why but alot of people who “know somone in the investment business” for some reason think they’ll provide them with the next 10x stock tip - this is definitely not the case).

I give them some direction. I show them Wealthsimple. I will literally show them how to do it.

And yet, what's really interesting is that as much as people say they want a different life financially, clearly they don't really want it.

What do they end up doing? Nothing. They don't do anything about their situation.

They might download the app. But then what? Half the time they stop right there, never open an account. They don't set up that TFSA. They don't put on an automatic contribution from their bank account to the investing account. They don't automatically buy low-cost ETFs. They don't look at their monthly budget, make sure they're cutting all the waste.

It’s sad to me that 1 in 3 (35%) adult canadians have never invested. The reasons preventing them are partly out of their control, but arguably also within.

And if they do invest, a lot of them will turn into gambling. Forget about the diversified low-cost ETF and put it all on one high-risk investment. Because they want to be rich yesterday, not in 15 years. It’s no wonder the average retail investor return is 4%, vs the stock market at 10. Over 30 years, that’s millions of dollars of lost money by gambling.

I’m not immune. I want to be rich yesterday too. Daily life is expensive, and it’s hard to produce enough income especially with the exorbitant taxes to accumulate generational wealth in a small number of years. So people are left with a choice: either gamble with a zero or hero type of return potential, or get rich slowly, with a much higher chance of success.

We all need to be honest with ourselves…unless you are an unusually successful entrepreneur, getting to a million or more dollars of spendable cash takes alot longer than people think.

One study I saw notes that the average millionaire in Canada reached that status by age 42. But that’s not showing the whole story, because it doesn’t talk about the folks that never become millionaires in the first place. It is heavily skewed to the top 20% of Canadians. The important number to consider is that the median net worth in Canada is $500,000 (bnn bloomberg).

And all of that inaction, combined with gambling tendency leads to people having a financially challenging life. Today, tomorrow, and guaranteed for the future.

We all look around and we see tons of money being spent. Single family home builders in certain markets are on fire because the rich people, the asset owners, are up millions of dollars on their investments.

But you know what the difference is?

They spent decades spending less than they earned, investing the difference, making sure they compound their way to wealth to then spend that kind of money later in life; it’s just the way the game works.

So, start contributing to your investing accounts consistently, early and often and preferably in diversified low cost ETFs.

You have to participate, if not, you don't get anything.

Give it some time and you will be wealthy.

PS. sorry for what might seem like a pessimistic commentary today. I tend to think it’s realistic, but many may mistake the latter for the former. At any rate, it mostly applies to people who haven’t yet subscribed to this newsletter. So please share your knowledge with your friends and family.

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“Without commitment, you'll never start. But more importantly, without consistency, you'll never finish”

—Denzel Washington

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