I’ve read a lot of personal finance books – I mean A LOT – and for the most part, unless there is a hook like the latte factor, or it is written in a unique “story” perspective like Jonathan Chevreau’s Findependence Day, the books are boring and the advice all sounds the same.
Wealthing Like Rabbits proves that you can make personal finance interesting when you combine clever story telling with humour and common sense.
Author Robert Brown takes a page from David Chilton’s The Wealthy Barber Returns, using sharp wit and original examples to drive home the point that making smarter spending decisions will ultimately lead to a happier, more fulfilling life.
The book is legitimately funny. I won’t spoil all the good stuff, but one worth sharing comes from a rant about a MasterCard commercial playing during an episode of Gail Vaz Oxlade’s Princess.
“What’s next? Are Molson and Labatt going to buy some time during an episode of Intervention Canada? How about Kentucky Fried Chicken offering up a deal (f#*k it, let’s get a bucket!) during an episode of The Biggest Loser. My mind wanders.”
Wealthing Like Rabbits is written as an introduction to personal finance and is clearly aimed at 20-somethings. That said, the book is highly engaging and an enjoyable read for people at any age and stage of life.
Ideas that I agreed with
Rabbits breed quickly. Your wealth won’t multiply as fast, but regular contributions will grow into substantial wealth over time.
The Home Buyers’ Plan is a bad idea. Your RRSP is for retirement. Raiding it to buy a home is foolish because you’ll sacrifice years of compound growth before you put it back – if you ever do.
“Wouldn’t it make sense to phase this plan out over time while simultaneously slowly changing the rules so that first-time home buyers only need 10% down to buy their first homes without purchasing mortgage default insurance?”
If you are putting less than 20% down so that you can buy more house than you can afford, then you are asking for years of financial hurt. Couldn’t agree more.
Balanced frugality. The idea that saving for the future means sacrificing today simply is not true.
“Just because people who live within their means don’t have an obsession with possession doesn’t mean they never buy themselves anything nice.”
Budgeting – Many personal finance experts argue passionately about old school budgeting techniques, like using jars, envelopes or an Excel spreadsheet to keep track of your finances. Others say to just pay yourself first and spend the rest.
Related: Why budgeting isn’t a waste of time
Robert Brown agrees with both approaches, saying that people should do whatever works best for their own situation. However, each camp can benefit from taking a hybrid approach – pay yourself first and budget the rest.
Take advantage of the RESP program and the generous 20% government match. Apply for a social insurance number and set up an RESP as soon as your baby is born.
Ideas I didn’t agree with
Many Canadians are struggling with debt, and I get that we need some tough love now and again. But a 22-page chapter explaining why we should avoid credit cards was a bit much.
The author made some good points, but lost me when he used the ubiquitous “freeze your credit card in a block of ice” tip to help control impulse spending. By the way, anyone who suggests this has obviously never tried running hot water over a block of ice. Thaws in seconds.
The author’s main argument is that people tend to spend more when using a credit card and that credit card companies have made it even easier to spend money by introducing tap-and-go, or pay-wave technology.
I don’t buy it. If your spending is dictated by your budget, why does it matter what method of payment you choose once you get the checkout?
Do you get a discount for using cash? Nope. What about debit? Your bank might charge you depending on your banking package. So, why not use the method of payment that puts a little something back in your pocket at the end of the day?
I doubt that “tap” or “wave” has made it easier to spend money on your credit card, as if the decision to buy something has anything to do with the ease or speed of paying for it at the checkout.
- Cashier: “Sorry sir, you’re going to have to enter your PIN”
- Me: “Are you serious?!? Ugh, just forget the whole order.”
The author mentions using a spousal RRSP as a great way to split income in retirement if one spouse earns significantly more than the other. But with the ability to split pension and RRIF income in retirement, this feature is now redundant.
Finally, the author insists that sound financial planning isn’t that complicated and most people would be better off without an advisor, at least “until you have a paid-for home and $500,000 saved in your RRSP”.
Sure, many advisors might give you the same basic advice – maybe – but in my experience some people just need a second opinion, someone to provide a sober second thought, and someone to help guide them on their financial journey.
Make no mistake – just because I didn’t agree with the author on a few points doesn’t mean this is a bad book. Indeed, Wealthing Like Rabbits was the most entertaining personal finance book that I’ve read since David Chilton brought the wealthy barber out of retirement.
Robert Brown wants us to use wealth as a verb and replace saving with wealthing when discussing any saving that increases your net wealth.
So, here’s to wealthing our way to financial freedom!