Was one of your New Year's resolutions to get a handle on your finances? If so, business journalist and broadcaster Bruce Sellery has written just the book for you. Moolala: Why Smart People Do Dumb Things with Their Money — and What You Can Do About It (McClelland & Stewart) combines interactive exercises, personal stories and practical advice to give you a simple but essential guide to managing your money in a way that lets you live the life you want. Here, Bruce lets Open Book readers in on a few of his secrets to success.
Moolala hits store shelves today!
Open Book:
Tell us why you decided to write Moolala: Why Smart People Do Dumb Things with Their Money — and What You Can Do About It.
Bruce Sellery:
I had been covering business news for many years. But the light bulb really came on when an old friend — a smart and accomplished woman — told me she didn’t know where to start in getting a handle on her money. I was spending all my time on the minutiae of quarterly earnings and economic forecasts, when what most people in this country needed was a way to get people engaged in the basics of personal finance. I wanted to try to do that, and that is why I wrote this book.
OB:
How did you develop the strategies for smart money management that you describe in Moolala?
BS:
In addition to business journalism, I have a background developing and delivering training. So I started by holding a pilot workshop for a group of friends. Based on their feedback I developed the workshop further and lead it over and over again to new groups. The main thing I learned was that insight trumped information every time. I had to help people understand themselves better, and uncover their own unique vested interest in personal finance. If I did that, they’d fill in the gaps in their knowledge.
OB:
What is the most common mistake that people make when it comes to money?
BS:
The most common mistake that people make is that they don’t know what money is for. I know that might sound overly simplistic, but it is true. Most people don’t have a context for money that excites them, inspires them and has them get the boring stuff done. If you have a context for money, getting a handle on it is much easier. Think about exercise, for example. People who exercise have a context for it — health, beauty, challenge, whatever. People who have a handle on their money also have a context for it — adventure, freedom, choices, etc. Their vested interest in saving money, investing smartly and all those other things is clear. This doesn’t mean that they’re frugal. It means that they have a handle on their money so they can live the life they want.
OB:
What kind of audience are you targeting with this book, and how did you ensure the ideas in Moolala would connect with them?
BS:
I’m targeting people who don’t want to make personal finance their new hobby. People who need a spoonful of sugar to help the medicine go down. Why? Because they are an under-served group, and frankly, they are the majority. If you LOVE this stuff there are hundreds of books for you. But if you don’t love this stuff, the pickings are slim.
To ensure that the ideas connected, I spent huge amounts of time in workshops with people, answering their questions and filling in the gaps so that the book would be as complete as possible. I also have ten readers who went through the drafts and told me what stuck and what sucked.
OB:
Do you think that the recent economic crisis will cause people to make more financial mistakes, perhaps out of fear or avoidance, or has it encouraged people to pay more attention to these kinds of decisions?
BS:
I think it has made people much more aware of what can happen in the financial markets. But that impact has been short term. Most people are fundamentally oblivious to their money, like contented cats sleeping on a window bench, basking in the mid-afternoon sun. When the door slams the cat momentarily lifts its head, but soon after it falls backs to the cushy cushion from where it came.
OB:
A recent Open Book-interviewee, Dan Gardner, just published a book called Future Babble: Why Expert Predictions Fail — and Why We Believe Them Anyway. How can we make the best financial decisions in the face of such uncertainty?
BS:
The uncertainty in the financial markets is mostly a red herring. Stocks can move up and down sharply in very short periods of time. This makes for great newspaper headlines, but isn’t really relevant for the average investor. The reason is that the decisions they need to make are much simple. How do I ensure that I’m earning more than I’m spending? What do I need to do to eliminate my credit card debt? How can I sock away 10% of my income? Have I taken advantage of tax savings vehicles? Are my investments doing at least as well as the benchmark TSX over time? These are the questions that really make a difference, and they aren’t tied to stock market performance.
Here’s the other thing — the last few years have been rough for the stock market, but the long term data show that stocks outperform every other asset class — bonds, real estate, etc. If you want your savings to outpace inflation over time, the stock market is where you need to be.
OB:
Just before the holidays, we were inundated with news about what poor financial shape Canadians are in. Our debts are too high and we aren't saving enough for retirement. Do you think Canadians are headed for a financial crisis, and if so, what can be done about it?
BS:
It depends how you define crisis. Will boomers nationwide be selling pencils in the street? I don’t think so. But at current savings rates the retirement that many people are hoping for just isn’t going to happen. And they are largely oblivious to that fact.
People will have to work longer, and when they do stop drawing a pay cheque they may find that they simply don’t have the disposable income to golf, shop and travel like they had hoped to.
What can be done? Well. They can start by reading Moolala.
OB:
You work as a business journalist and are an accomplished public speaker. Can the advice that Moolala offers about personal finances be applied to career goals as well?
BS:
It is interesting that you asked that question. It absolutely can. Moolala is a five-step process for getting a handle on your money so you can live the life you want. If you look at the steps themselves they could be applied to lots of different areas.
I think what that points to is that this really isn’t rocket science. The steps are simple. It is the taking of those steps that can be hard.
OB:
In addition to Moolala, the book, you also offer public-speaking workshops that explore similar ideas. How does the process of preparing and delivering a workshop compare to the process of writing the book?
BS:
I’m a talker. One time as a news anchor we lost our satellite feed and had no tape to run so the producer told me to “fill.” So I talked. And talked. For almost 10 minutes, by myself, about whatever. From that perspective workshops are much easier for me. Writing the book was, at times, a terrifying process. It was solitary and I had to face a blank page day after day. Were it not for the grace and insight of my editor Anita Chong this book would never have seen the fluorescent light of the book store.
OB:
What is one piece of financial advice you'd like to leave us to think about?
BS:
My advice is to figure out the single most important thing you need to do get a handle on your money, and go out and do it.
Flip to page 65 of the book, or go to www.moolala.ca and learn about the Priority Pyramid. There is an article and a video about it on my blog.
Getting a handle on your money can be overwhelming, until you determine what you need to work on first. The Pyramid will help you do that. Then you can ignore the news headlines, the not-so-subtle hints from your in-laws, etc., and focus on the single most important thing for your circumstances.
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Bruce Sellery is an experienced business journalist and professional speaker. One of the founders of CTV's Business News Network (BNN), he has anchored thousands of hours of programming from both Toronto and New York since the network went on air in 1999. In addition to his work on BNN, he has appeared on Canada AM, CTV News Channel, CBC Newsworld, Citytv's Breakfast Television and CNNfn. More recently, Bruce founded Moolala, an organization focused on inspiring people to get a handle on their money so they can live the life they want. He is a professional member of the Canadian Association of Professional Speakers. He leads both public and private workshops and is a regular keynote speaker on the topics of investing and personal accountability. Visit him at his website, www.moolala.ca.
For more information about Moolala: Why Smart People Do Dumb Things with Their Money — and What You Can Do About It, please visit the McClelland & Stewart website.
Buy this book at your local independent bookstore or online at Chapters/Indigo or Amazon.
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