Table of Contents
Erwin Szeto [00:00:07] Happy New Year. Fellow Hackers, My name is Erwin Szeto and this is the truth about real estate. Best in show for Canadians. One of the nice things about the holidays has been the time and space tart cherry. A better life than those who don’t know. Let’s talk about our future vacation plans for the summer winter, future summers, retirement and of course, investments more for the short term, as in how we’re investing with the next few months. This year’s been a good one for us. Hence our record donation to the Hamilton Bass Brigade and we saw some cash leftover to contribute to retirement savings plans. RSP I’m splitting your mind roughly 5050 half to invest in the Inland Development in Northeast Greater Toronto area, which is projecting triple digit returns in just over five years. An investment is $25,000 Canadian. I’m stating this because this is the most common question. I get this. This is the same investment, opportunity and opportunity I met two weeks ago and it’s since has since become available. Feel free to email us at I at Infinity Wealth Dossier. If you’re interested in investing as well, if you can’t email us. Feel free to reach out to me or me on one of our social my social media platforms. We’ll get back to you. We here at I, when we receive an allocation as in a share of each project in order to offer to our clients because these developers like working with our referrals. Also remember the benefit for people who invest using our allocation is they treat you better than someone a stranger. They meet off the street. Also, as an added bonus, anyone who invests in any of these projects is invited to the friends and family access to any of these pre-construction deals. I mention this because a few of our clients, including James Moneybags, Max and Beam in Costa Rica right now at his lovely house, 400 meters from the ocean. Everything comes up, moneybags Max. He also took advantage. He took advantage because he’s invested in in past developing projects. So he got access to pre-construction condo access and Liberty Village. He bought himself a rental property there in Liberty Village, which is the west side of downtown Toronto. He bought one there. He got a discount from it, and he also got to pick his units and pay for his unit before any realtors were able to buy or bring clients as well. And of course, you’re all investors. I’m an investor. I know how we all love discounts. So this is not something I want to miss out on the other half. My art piece will go towards my stock character account, all wholesome as cash, just waiting for opportunities to rise and I’ll add to my crypto positions. So that means specifically companies that are invested or mining cryptocurrencies such as Bitcoin that force folks to stand versus consider the basis for this financial advice controversy. A friend of mine asked me last night why I don’t just buy and hold crypto, specifically bitcoin. We both are big fans of crypto, hold a percentage of our assets in crypto. He asked me Why don’t just buy and hold, for example, buy and hold bitcoin. I response was I buy and hold real estate because it’s not volatile. It doesn’t jump up and down in price, but when it is, it tends to be going up. So I’m happy to just to hold it. Whereas things like Bitcoin and Ethereum, they go up, but they also go down in very wild swings. 10% in a week is not uncommon to imagine that real estate. I don’t know if I’d be in real estate if that happened, if it was like that. Anyways, so by stock hacking I get paid on these wild movements, I get paid a premium and I like getting paid and I can only do so on companies that have stock that are related to cryptocurrency. Now, if that doesn’t make complete sense, that’s totally okay. All learning is a journey, and I do offer free training on stock hacking, which can be applied to blue chip companies like Disney, Apple, Walmart, or Magic Internet money companies like Bitcoin. Your advice people if you’re interested WDW Dot Star Attacker Academy dossier is a link. Just click on the free demo button in the top right or you can tell your friends to do this. Anyone who would like to make sure cash flow in their lives. On to this week’s show with Cornell Schreiber. Financial freedom or independence or security or whatever your goals are. There are many ways to get there. I personally think having a home paid off and preferably more properties pay it off. At least one other investment property. Having a paid off investment property would be life changing for many. For those who live around the Toronto area, around the bank Vancouver area, that would mean your net worth is probably around $2 million. That’s pretty significant. Yes, having ten paid off investment properties or more would be even more so. But not everyone is that ambitious. Is actually a friend of mine who’s a mortgage, pretty successful mortgage agent who focuses on investment on investors. So pretty much all his clients are investors. I asked them like, how many clients have more than ten properties? And I think you said less than 1%. So yes, if you own ten or more properties, you are a distinct minority and some are. Good with living frugal lifestyles. That’s totally cool to people who I met when I started this real estate journey, I met two who I considered financially free. And this is before the real estate boom. So they weren’t free because of all the equity gains. They’re actually free from the cash flow. One, only a couple of broke student rental properties and the other owns two Triplexes in Toronto. She lived in one of them. One drove a really old Mazda. The other didn’t even own a car. Again, these are frugal people and didn’t have day jobs. So not bad. Today we have Cornell, who has found freedom mainly through buying boring, buying whole exchange traded funds, ETFs for short. So these are like all the rage the last five years or so for people who want to buy and sell stock, but really boring couch potato style, style investing. Again, folks, this is not advice. These instruments, ETFs, they trade like stocks and they track movement the movement of an index or a sector or commodity or even funds that are managed by professionals. I, like many of you, I couldn’t stay retired for very long. Has he actually purchased a conference call up a Canadian financial summit? And he made, as he says, not an easy feat in my experience. But it helps. Someone hosts a successful podcast like Cornell does 1.2 million downloads, to be specific, and the show is called Build Wealth Canada, and it’s available anywhere. One. This is the podcast on his show. Cornell focuses more on interviewing finance experts for their best practices, tips and tricks for financial planning purposes. And again, to follow Cornell. You can go to his podcast. His website first podcast is Build Wealth Canada data in his conference can be found at Canadian Financial Summit dot com. He’s near the show. Hi, Cornell. Let’s keep me busy these days.
Kornel Szrejber [00:06:45] Okay. Good to see you. Now just start running the podcast, The Build of Canada podcast. And I run the key financial summit once a year in October. So yeah, just been busy with just been busy running those. And then I’ve got two kids also keeping me busy and trying not to gain too much weight during all this COVID business. So and so those notes give me a pretty busy.
Erwin Szeto [00:07:06] Feeling of the way things.
Kornel Szrejber [00:07:08] I see. The eternal struggle.
Erwin Szeto [00:07:10] I’ve taken this just skipping one meal of the day. Folks, this is not advice, I think. Let’s start there, folks. None of this should be considered advice.
Kornel Szrejber [00:07:18] You got to like investor guys here. You would me I’d go yeah let’s. Start off talking about health. But.
Erwin Szeto [00:07:24] Also on the investment side, none of this should be considered advice.
Kornel Szrejber [00:07:27] That’s right.
Erwin Szeto [00:07:28] The last episode I recorded yesterday; we were all drinking. So like, okay, please don’t consider any of this advice. We have been drinking. But yeah, we’re, we’re not licensed professionals to give advice. We’re just speaking from experience and our own experience and our own opinions. And we’re here to help. I’d love to see everyone successful at the end of the day. So no haters, please. I have disabled my reviews on my iTunes. So Cornell, actually, that’s really cool. There is a fun, useless fact of the day. I always forget the name of Cornell University because it often it comes up in my conversations with people as I know you don’t do crypto, but when people ask me about like, where should I start learning about crypto, I often tell them, Hey, there’s a book by called The Bitcoin Standard. The authors, his name is David Enamels and he’s a Ph.D. My mom was from I forget which college university? It’s Cornell. I always tell them, what’s that Ivy League school out of? That’s in Ithaca, New York. And I always forget Cornell. Now, I think I’ll forever remember Cornell. And like, you’re so lucky to have that name, because now everyone instantly thinks you’re smart.
Kornel Szrejber [00:08:32] It’s true. I get to piggyback on the Cornell branding, even though it’s completely unrelated. But so.
Erwin Szeto [00:08:36] Cool. Yeah. No, it’s a different spelling, but still.
Kornel Szrejber [00:08:39] I think it works. Yeah. Like close enough, at least a positive association with that name. Even though that’s my first name. You know it’s not my last name. There’s definitely a lot of Cornell’s with the last name Cornell. But I’m. Yeah, for me, it’s first names. Cornell, last name? Schreiber. So yeah.
Erwin Szeto [00:08:53] Like even if you take your name, your kid Einstein, and then you spelled it differently.
Kornel Szrejber [00:08:57] Oh, yeah, it doesn’t matter. Yeah, it’s the positive association, right? Yeah. Yeah, that’s awesome. Yeah.
Erwin Szeto [00:09:02] So, yeah, you’re on your own conference, so I run the conference, too. I know how hard that is. Are you nuts?
Kornel Szrejber [00:09:11] Yeah, I have. I have partners that help me with it. Now, Serena myself in 2020, with some help in the pandemic. And I have. Oh, yeah, yeah, yeah, yeah. So I was just like maybe at my assistant at one of the partners was helping on the back end and stuff. But yeah, there was a lot for kind of one person doing the bulk of it. So now when we, when I ran that last year and it was when you want, I did it with my two other partners plus an assistant. So yeah, it’s a lot more manageable. It’s definitely not something I’d. Like. For all these sort of solopreneur is out there. I wouldn’t recommend like a starter card, a conference. Because it’s. Yeah, it’s very easy to burn out to say the least. Even with an assistant, even with someone managing the i.t side. Like what I had for sure. Right.
Erwin Szeto [00:09:55] And then both iterations were virtual.
Kornel Szrejber [00:09:57] That’s right. Yeah. Yeah. So the contract, it’s called the Canadian Financial Summit if anybody wants it runs of. A year in October. So if anybody wants to buy tickets, you can go to my. There’s a special link I made to get free tickets. So it’s Build Wealth Canada dossier slash summit. So as you might. Of Canada’s basically my podcast name and my own personal site so. But if you go to that link you can actually just go there and you’ll be able to get free tickets that way. So yeah. So it’s great. It’s based on personal finance, investing, best practices, lots of interviews with financial planners, investing experts. We have some real estate on there as well. And then, yeah, it’s just a very, very educational thing. We’re really trying to encourage financial literacy and yeah, it’s every year. So you sort of hear a lot of things you kind of hear in the news and you may pique your interest, but then you sort of want to say, okay, what should I actually know about this? Let’s go a little bit deeper. So we’ve got interviewers on different presentations, PowerPoint slides and all that, a whole mix. You’ve got a life Q&A session that I started as well. So really, really good education resource for investors and just financial literacy in general is specifically for Canadians, which is a big thing to mention as well. So it’s all relevant to you as a Canadian.
Erwin Szeto [00:11:06] That’s your name is Cornell. I think you should come up with a high school course of financial literacy.
Kornel Szrejber [00:11:10] Yeah, yeah. That’ll. That’ll be fun. That’s maybe something I’ll do a bit later.
Erwin Szeto [00:11:15] If you need a hand with that, let’s get this thing off the ground. So how was it? So your first conference, who did you have as your speakers?
Kornel Szrejber [00:11:23] Well, we had quite a few, so we had Rob Kerrick from the Globe and Mail or we have Rob Carrick. And then. Yeah, yeah, he does, he does. He does some great stuff. We have Peter Hudson, who has been known as the he’s been called the Warren Buffett of Canada by the Globe and Mail. So he’s what he used to run, one of Canada’s largest. It’s what was either one of or the largest hedge fund back in the day. So we had him answering questions about portfolio and investing, individual stocks, that kind of thing. And pretty much all the major bloggers out there with bloggers and just experts in the field. So yeah, we had Rob and Jen, we had Mark Seed, we had a couple previously, anybody basically if you just Google and then you go to sort of the top personal finance sites in Canada where they’re supposed to finance investing. Basically someone was there from almost every single one source sharing what they learned and sharing best practices and what they found in their research. So yeah, it’s been very, very educational for people. It’s great and it’s fun for me because I get to pick their brains and then that we share with the rest of Canada. So yeah, we had over 20,000 people this past year. So yeah, it’s, it’s a very, very, it’s all digital, right? So everybody from across Canada joins it. Yeah, it’s a very fulfilling endeavor because it’s just nice to sort of be the positive force in enhancing financial literacy in Canada. And that’s great. So yeah, there’s no like crazy speculative stuff on there and you know, get rich quick. It that’s not it at all. It’s very much what people are like to buy and hold kind of investing is sort of like, you know, get rich slowly sort of thing, right. And best practices. And what’s the smart way of doing it? Not so much. Not none of that. Like hype. Oh, yeah. You know, you make this money overnight and not nothing like that. So. So it’s a very good fit personally, because that’s how I invest as well. And it’s always fun to pick the brains of other really smart people and then apply it to my own portfolio, but also share with the rest of Canada. So it’s been great. Awesome. It got me out of because I was fully retired and that got me out of full retirement that I’m back to semi-retired. But it’s, it’s been great. It’s a lot more fulfilling than just being fully retired.
Erwin Szeto [00:13:18] Can you share the age that you retired at?
Kornel Szrejber [00:13:20] Yeah, so it was 32. So 32 is when we hit our financial independence number. So my wife and I both put our jobs, our full time jobs under. When I was 32, she was 31. And then, yeah, she became a full time stay at home mom. I switched over to part time, so I work basically from home a few days a week and then after two years I wanted to me was like, this is this is a lot of fun, but I kind of want to try the full retirement thing. And so that’s what I did. And that did the full retirement for six months. After five months, I was getting feeling very unfulfilled. Very end. Because it’s not for, you know, for type-A personality kind of person. It’s not a good fit to, you know, you’re not going to feel happy and fulfilled just sitting and watching Netflix and being unproductive and just kind of lounging around all the time. So that was a very big surprise and lesson learned on my end. Like after six months busy, five months, I started looking for something new and that’s when the summit came along. And so I took that over. So now I just run the Build Wealth Canada podcast and then the Canadian Financial Summit, which I just realized is a really long answer to your question. But I’m trying to get the origin story in there, too, because a lot of people are curious about that.
Erwin Szeto [00:14:26] So you said the conference came along. How did the conference come along?
Kornel Szrejber [00:14:29] But it was your baby. So I didn’t I didn’t build the conference from scratch, by the way. So what happened is it was already running for several years. And then actually the founders of the conference wanted to sell it to me. And so and so I was looking for something new to take on because I have the podcast, but I do one episode a month, right. So it’s, it’s not that that’s not enough to kind of get that fulfillment I was looking for, I guess. So I was like, okay, I can I’m going to have to either scale up the can, have sort of the podcast somehow or take on a new project, right? And so at that time, they were basically trying to sell me the conference. And I said, okay, well, let me just let me just tried for a year to see if this is something I actually want to do. And so I ran it, like grew it a lot like more than doubled. The conference site is not one year that I ran it and then I was like, Yeah, this is actually pretty fine. I’ll be happy to continue doing this. And at that time, they also said, Hey, actually, can we be back? They were happy with the results, I suppose. So they because they were partners that are right. And so they wanted to now join and be part of it again.
Erwin Szeto [00:15:26] Oh, those are now those are your partners.
Kornel Szrejber [00:15:29] So those are my partner. Yeah. So, so I went from them trying to sell it to me to now I just saying, hey guys instead of selling it to me, why don’t we all. We’re partners and we run it together because like I said earlier, it’s definitely not a one person job. It’s especially one is like a 20,000 person conference. It’s pretty big. Yeah.
Erwin Szeto [00:15:47] So how many people attended.
Kornel Szrejber [00:15:48] Was over 20,000 Canadians? Yeah.
Erwin Szeto [00:15:51] All across Canada.
Kornel Szrejber [00:15:52] Yep. That’s right. Oh, that’s a good number of people. Yeah. Yeah, it’s great now. Yeah. So, like, um, this year we had money sense to be part of the super magazine. Be part of it. Yeah. Just managed to carry all of all the to just about all the big players were somehow involved in it for the most part. So it’s been, it’s, I mean, yeah, it’s hard to get everyone, obviously, but it’s, it’s definitely sort of the place to be for anyone interested in investing for sure.
Erwin Szeto [00:16:15] Right. Right. That the sellers are now partners. Did they have a list of past clients that you were able to market to? Is that part of the reason why you were able to get so many people out?
Kornel Szrejber [00:16:24] Well, yeah. So yeah. So the way that it worked was they had their email list of past attendees. And so obviously when it was time for the new conference, I was all the people that attended in the past. I was able to invite them again. So a good chunk of people came from that. But then I promote another way, so I would have different partners involved. Then I would say, Hey, great to have you as a guest, but can you also promote to your audience as well? And so that was really what grew it a lot as this sort of setting up these partnerships where it’s like, Hey, I’d love to have you on. I really like your content. It’s very educational benefit from it. I’d love to pick your brain on what you do and you know, can help with financial literacy in Canada. But can you also promote it to your audience that you’re going to be speaking at it? And that way, you know, we kind of have you know, we could we can grow this thing together, right? Because the more if everyone does that, then the competitions are being huge, which was like over 20,000 people and they sort of, you know, the rising tide was an expression. A rising tide raises all. People such as the. I.R.A. So that was the somebody sort of whole framework or thought process behind that. And yeah, and now it’s so big that it’s easier to get people to come on because it’s so massive, right? So yeah, so that’s sort of it in a nutshell.
Erwin Szeto [00:17:31] And to bring up the Cornell High School course again for financial literacy available, raise a lot of ships for sure.
Kornel Szrejber [00:17:39] For sure.
Erwin Szeto [00:17:40] And then previous to 2020, was it a live conference or was it still virtual then?
Kornel Szrejber [00:17:45] There was always virtual. It was always virtual.
Erwin Szeto [00:17:47] Fascinating.
Kornel Szrejber [00:17:48] That makes it more fun because if it’s like as nice as it would be to have a in person, there used to be a what in Canada where it was like at the Toronto Library and some people would fly in and it was it’s pretty cool. But if you’re the organizer of that, that’s so much more stress, right? Because now you’re dealing with venues like the logistics. It just gets a lot more complicated, a lot more costly. You know, you have to pay there’s no free tickets in that scenario because you’ve got to pay the venue, right? You got to pay for all these things. You got to pay for food. So it’s much, much more challenging, whereas because it’s online, there’s no geographic restrictions, right? You could be at totally opposite ends of Canada and everybody could still attend and still do it. So I just find it’s a much better fit and it keeps my gray hairs at bay because it’s a lot less stressful not having to worry about, oh, are you going to be able to sell enough tickets to cover these giant venue costs in downtown Toronto? Right. Wouldn’t have to worry about that. So, yeah, so it’s been a good fit for, you know, big thing is the whole everyone has access to it. Guess. I mean the end goal is increasing financial literacy and by making it digital, that’s exactly what we can do. And by making the tickets free, everybody can attend, right? So there’s no soul. No matter how wealthy you are or how poor you are, you’ll get something out of it because you’ve got sort of beginner topics, but also a lot more advanced topics, right? So no matter who you are, no one sort of can attend because it’s too much money, even though that might be the person that actually needs this information the most. Right. So yeah, so that’s the that’s what it is in a nutshell.
Erwin Szeto [00:19:10] That’s the main thing. Cause I have a lot of gray hair from when we did the conference in 2019, thank goodness, at least as before the pandemic. I don’t know what we would have done if it was if we had made that same investment in the pandemic, in the oh four pandemic. I mean, giving all that money tied up all my board.
Kornel Szrejber [00:19:24] Oh, yeah. I yeah. I just, I get, I can feel the gray hairs growing just thinking about it. The mere thought.
Erwin Szeto [00:19:33] Yeah, yeah. Any time you want to talk about this. Yeah, let me know you’re running the conference. The venue cost. I don’t know if people understand like it’s not even just the venue costs, all the other things that come on board that are on top of that. Like we had to hire a caterer and that is that all the staff are unionized or not. And then if I want to bring in my own type of company, what can I do that? And then I’m like, Oh, you’re over a certain number. You need to hire security. Like, Okay, now you’re over the certain number into higher parking lot attendants. So it’s just. You’ve got piling up.
Kornel Szrejber [00:20:04] Exactly. Yeah. Yeah. And if you had some numbers, a minimum. Right. There’s consequences to that because the hotel you signed a contract with the hotel or whatever. Right. And you had to commit. So yeah. Yeah. That just very, very stressful and never restricts be able especially now need your Corvette right people want the digital piece so just so anybody can have access, right. And so it’s become a safety thing as well. Right. So yeah. So I mean, I just, I mean, cool. It hasn’t hurt the conference at all, which is nice.
Erwin Szeto [00:20:29] That’s awesome. I’m disappointed in images sooner and before recording I blamed you because of my friend request on Facebook. So no one try to at Cornell unprovoked.
Kornel Szrejber [00:20:39] Yeah I don’t I don’t really go. On social media much. So don’t get. Mad if I don’t reply.
Erwin Szeto [00:20:44] Is probably why you also have less gray hair than me.
Kornel Szrejber [00:20:46] Yeah.
Erwin Szeto [00:20:47] Let’s talk about how you did it. How did you do it? How did you retire at 32? So people who listen this show, all 12 of them. We have we have quite a few guests on the show who are retired, but of the population of like your friends. How many people do you know retired in the thirties?
Kornel Szrejber [00:21:04] Yeah. The only reason I would say I know people like that now is because I’m a podcaster, I’m in the space. And so I’ve interviewed those people. But yeah, it’s, it’s extremely rare for sure.
Erwin Szeto [00:21:15] Extremely rare.
Kornel Szrejber [00:21:16] Yeah. Yeah. But I mean, to answer your question, I mean, there’s, there’s a lot of small elements, but I would say at a higher level, things that really, really move the needle for us over the years is one straight at a university. My girlfriend, who’s not my wife, we moved in together right away. And so by doing that, we were able to become a dual income household right away. And so that helps a lot, right? Because there’s a lot of sort of economies of scale that you get when you do that. And for someone that doesn’t have a significant other or does have one, but they’re not that at a point in the relationship or they’re willing to do that right out of university, which is understandable. I mean, the alternative I often suggest to people is, well, what about due to the roommate thing, right? Instead of renting some condo and one bedroom condo or whatever, what if you especially this is a real estate show, right? What if you actually bought a property and then you had, you know, you turn it into like a rooming house, right, where you have one of the rooms in your rental, the other rooms and you make money, you know, that way. Right? And so that way you can sort of get some of those economies of scale that I got. But by not actually being married or not having a significant other, but by just by, you know, doing roommates. Right. So, so I mean, that’s kind of like a workaround to get sort of the same. I think benefits are very similar. But that was the one thing, right, is to become a do welcome household. So you have two full time incomes, zero kids, lots of time because you don’t have kids yet, you can really ramp things up. So that was the one thing. And then the other thing was really living off one salary for like we’ve been doing that for over a. Decade and so. And so that was a real game changer. And so there was no stupid formula. There was no like big windfall we got where all we’ve invested in some bitcoin when it was a dollar and now we, we don’t have anything like that and nothing crazy it was all just like small incremental things little optimizations here controlling our spending. Right. And just you kind of compounding, right. You kind of do that over time. In my case, you know, over a decade and things start to really that those results really start to show. So really by living off one salary, what, what like what we did is would be when we still had our mortgage, but one of our salaries would go towards just paying day to day expenses and the other one would go towards paying off the mortgage. And so that’s how we did it. And sometimes, you know, we’d have to depend like if there was a big car repair, then we’d have to kind of dip into the other salary, things like that. But for the most part that was our goal and that’s what we always strive to do. And we managed to try to manage our money and lifestyle in such a way that allowed us to do that. And so by doing that, we were able to basically, you know, spend several thousand dollars in additional mortgage pay down to be able to do that. Right. And then so that was really sort of the gist of our rights, just controlling spending, controlling our lifestyle, that kind of thing. Now, in retrospect, I would not have done that because this was like so I graduate in 2007, which was right before the great financial crisis. And so that being straight out of school, not knowing much about investing yet and about market cycles, that event really freaked me out because I would see my director who I would report it to, you know, he’s like, Oh, I just lost like $100,000 this past week because, you know, we’re going through the 20 financial crises. And so for me, I kind of let fear take control and was like, okay, well, the stock market thing is way too risky for me. You’re right. Real estate seems crazy risky to now because, you know, you see, like all these all these foreclosures and in the United States, that kind of thing. Right. And so there are lots of them. Yeah. Yeah. And so my defense mechanism went up, which in retrospect was a mistake. And I’m just like, you know what? Let’s just plow the money into the mortgage, because every dollar up in the mortgage is I’m not going to lose that. Right. And so I went for like the ultra, ultra-safe approach and just paid on the mortgage. You know, in retrospect, knowing what I know now, if I was to do it all over again, I told you what I’ve invested just the total market index ETF investing, which is pretty much all I do now, because then I would have been able to ride that wave back up, I would have been able to ride that recovery. And so I calculated once that it hurts me to see how much money I lost in terms of the impact on our net worth. Because if only I did that instead and invested instead of paying on the mortgage, our net worth would have been so much higher we would have been able to retire even earlier. But, you know, you live, you learn and. Yeah, so that thing just because I always kind of say that. Cautionary tale a little bit because even though it worked out well for us, it’s not something that I would recommend where you just focus on paying down your mortgage because it’s not the highest sort of expected return that you can get. Yeah. So that was in a nutshell. Right. And then once the mortgage was paid off, I learned I started the podcast. What happened is mortgages paid off. We have all this extra money now that we can just spend it. If you want it to. Right. Because you don’t have the mortgage payment anymore. But what I realized is, well, hold on. We’re actually pretty behind on our retirement savings now because we’ve been pumping money towards the mortgage. RRSP tfsas aren’t maxed out like we’ve just been doing the contribution of our work, but that’s pretty much it. And so the still kind of the next thing was, well, what if I interviewed? What if I start a podcast and start interviewing different experts in Canada and different financial planners, the investing experts, right? The tax people just to learn the best practices when it comes to saving for retirement, financial planning, investing, saving on taxes, that kind of thing. And so that was really the project was the podcast would give me an excuse to basically talk to these really top notch people, essentially for free and share with the rest of Canada. And they would come on and do it and not charge me like $300 an hour because they’re getting some publicity out of it. Right? So that was kind of my idea. And I thought, hey, even if the podcast fails, I would have still learned an absolute ton and I would have helped out and hopefully a few thousand Canadians. And the story, you know, everybody still wins, right? But then the podcast actually did well, like we’ve got it’s over 1.2 million downloads at this point. It’s been one of the biggest ones in Canada for like seven years now. So it turns out the podcast actually did well, but I basically ended up applying what I’ve learned by interviewing all these different guests and apply that to my own portfolio, which was the kind of the intention all along. And that helped us keep things really, really optimized from an investment feast, keeping your investment fees low, keeping taxes low, all of that financial planning. And that helped us actually achieve that financial independence number when we were 32. So we can dove deeper into any section if you want, but sort of at a high level, just talking for 20 minutes about our backstory. That’s basically. That’s basically what it was in a somewhat summarized. Form.
Erwin Szeto [00:27:14] So more fun this use this back to the day. I actually had a past guest on the show. He backed up the truck in 2007. So him and his wife, I believe they each collect 70,000 in dividends, so.
Kornel Szrejber [00:27:26] Oh, nice. Yeah, yeah. There’s one financial blogger that I follow. He’s in the States. He’s our root of good. His name is Justin, and I interviewed him as one of my first guests. And it was. Yeah, and he actually did kind of what you’re talking about is he went, Hey, he understood that he’s older than me. He understood this before I did. And he went kind of all in on islands of depends how you define that. Right. But he invested as much as you could during that time because he knew there was a recovery coming. And I mean, now his portfolio is like intellectually and like he’s done really, really well because he actually took advantage of that. Whereas me here I was paying down my mortgage because I was too scared or whatever, you know what I mean? So but it is what it is, right? You’re fresh out of university.
Erwin Szeto [00:28:07] You have no one to show you the ropes.
Kornel Szrejber [00:28:08] No. Yeah. And I’m a business grad, too. Right. But even in business school, right. They teach you how to be really good at working in a corporation that they’re not teaching you about. Index investing one on one, right? Yeah. I went to one of the best business schools in the country and it was on. I went to Laurier.
Erwin Szeto [00:28:24] High Excellent School.
Kornel Szrejber [00:28:25] Yeah. Yeah. So they have a business co-op business magical program that like at the time it’s like one of the best in Canada was like top three. And depending on who you ask, like yes, you’re like, oh, it’s number one. But it was, it was. I remember at that time it was like Laurier, Queen’s or Western were like the top. Like if you’re going to go to business, these are all wants to go to your right. But so even in that school like it was fantastic at getting you a job after university and high paying.
Erwin Szeto [00:28:46] Because you have a co-op that was.
Kornel Szrejber [00:28:49] So getting a high paying job in your field was also relatively easy right away. But it’s not easy except to work your tail off to actually get there and get into co-op and get a job. Like you have to work really hard and you have to have a really high average to get in do. But you know, once you did that, you actually were able to get a really high paying job. So. So that helped you, right? Like I had a really good typing job right out of university as well. But what was that? What was the question?
Erwin Szeto [00:29:10] I remember, yeah, you went to their school.
Kornel Szrejber [00:29:12] And I go, I got a yeah.
Erwin Szeto [00:29:14] I went to Ivy you graduate to that is during the financial crisis. I graduated 2001 right after 911.
Kornel Szrejber [00:29:21] Oh, my goodness. Yeah, yeah.
Erwin Szeto [00:29:23] I was in finance. I remember I was watching the financial markets class, second year financial. So my fourth year, my fourth year financial markets class and the planes hit the buildings like that. No idea how bad things would get. Yeah, I knew it was like a horrible loss of life day, but I had no idea what the ripple effect would be. Entire markets.
Kornel Szrejber [00:29:43] Yeah, yeah.
Erwin Szeto [00:29:44] Not just the entire financial markets, but also like my own personal job market.
Kornel Szrejber [00:29:47] For sure. Sure. Yeah, yeah. I mean, yeah, I guess I got lucky in a sense to like, I didn’t get laid off or anything like that. You know, the specified like being a relatively high earner like early, early on or whatever. But yeah, so it kind of the hard work paid off right as well but. But I guess so. I guess you can really relate to the whole having some fear, right? Early career, right?
Erwin Szeto [00:30:07] Yeah. Markets change. So I’m around 27. Real estate. Sorry. Financial markets are tanking. Really disappointed in ourselves. We only bought one investment property in 27, so one did really well. Oh yeah. We were the opposite. I always. I’ve always been the opposite with that. I’m always like, Oh, it’s so cheap. I think I can make more money with all these investments and just pay. Like at the time was like four or 5%. I was paying four or 5%, but I’m trying to make 15 20% of my real estate investments and worked in a lot higher than that.
Kornel Szrejber [00:30:39] Yeah.
Erwin Szeto [00:30:40] I predict the future folks that don’t sue us. But yeah, you mentioned ETFs so yeah. Get rich slow. This doesn’t get rich overnight. This isn’t shiba inu crypto doge currency stuff this is sorry what you’re what you do start with like the slower paced investments.
Kornel Szrejber [00:30:56] Yeah, we were k remember what year it was exactly. But it was summer around when we were 20 when I was 29 ish because that’s when the mortgage was paid off. And so we started powering. So, you know, my wife had a defined had a pension plan under work, just a defined contribution pension. Okay. Right. So we were still.
Erwin Szeto [00:31:13] Owed contribution I think you said benefited like wall.
Kornel Szrejber [00:31:16] Oh, no, no, no, no, no. I was. Oh, that would be. Nice. I know. I’m so jealous of the, you know, the teachers and the police officers. That were all jealous of you. Solid eyes.
Erwin Szeto [00:31:28] Until they get such anger in the news.
Kornel Szrejber [00:31:30] It’s on you. But yeah, so it was around, I would say it was around that time that I became like a DIY investor because before that we were still technically investing in her defined contribution pension plan. But you know, that’s like, you know, cap and that kind of thing, right, in terms of the employer match and all that. So yeah, so, so it was, it was around that time. But then we also had, I should mention we had a real estate holding as well, which did well. So we had a rental property too that I had. And so yeah, I mean Kitchener real estate just been crazy in Canada in terms of it just going up in value. It’s been nuts. And so we had that. So we definitely that helped us retire early as well because we definitely made all good. So when we actually had that retirement number, what we did is we were once sold. I sold the rental property, put that all into ETFs, into passive market ETFs, and then we also actually downsized our house as well. So because that was another way that we can make the numbers work a lot more and then basically took those proceeds and put those into, you know, index ETFs as well. And so those were sort of the two levers we pulled, the selling the rental property, plus downsizing as well. And because we were willing to do that. So also like, you know, we went down to one car instead of two, right? So we did these significant trimmings. Things that really impact your expenses on annual basis, like housing and transportation are huge, right? So we cut those quite a bit and that also helped us make the numbers work in terms of, you know, and then also, you know, in case I did something wrong, I still had the part time job that I was doing as well. Right? And so that was kind of there was like an extra little cushion just because I’m a risk averse kind of guy when it comes to those kinds of things.
Kornel Szrejber [00:33:03] Yeah.
Erwin Szeto [00:33:04] So what do you do for cash flow then?
Kornel Szrejber [00:33:05] Right now. Yeah. Or when I was fully, fully retired.
Kornel Szrejber [00:33:10] Oh, sure. Because the decision.
Erwin Szeto [00:33:12] To semi-retired retire either one. Like you have to have income, subtract income coming in to, you know, keep the lights on. Yeah.
Kornel Szrejber [00:33:19] Yeah. So like, so we still don’t have a mortgage, right? So that helps a lot. We only have one car and it’s like a $15,000 car, like after taxes and stuff. So, you know, we don’t do those kind of two big things that really hurt cash flow on a month to month basis, you know, where someone buys like a $70,000 car and you know, I’ll take on debt, that kind of thing. So we don’t have that right. Yeah.
Erwin Szeto [00:33:36] We just ordered a Tesla and.
Kornel Szrejber [00:33:37] I feel like. So in our case, yeah, we own one in the car. It’s a, it’s a van. We have two kids. Right. Pay like 15 grand cash for it, you know, so that’s one thing. Plus no mortgage. So that helps a lot with cash flow. We live in Kitchener as opposed to like downtown Toronto. So obviously that helps a lot of cash flow from just obviously just a lot more expensive to live in Toronto, even like groceries, you know, things of that nature. So there’s that let’s see, I when we were semi-retired or like now when we are and also when I first started, we were semi-retired. And so when we did that, whenever we got dividends. So I don’t I’m not a dividend investor, I just do total market investing, like I said. But still, even when you’re that kind of investor, you still get dividends, right? So with the investments I buy, I get them every quarter and so that generates some cash flow. So I take that out and basically use that. So that’s one area since I was semi-retired, I also have the cash coming from the part time job. You know, the podcast was making a little bit of money then as well, so some of the cash flow was coming in from there. And then also I had a bit of a cash cushion and cuz the markets took a dove and when they didn’t take a dove I would also sell off some of the ETFs. Right. So yeah, that, that’s basically it. Right. So taking out I was like, okay, if I take like three and a half percent of the portfolio per year from every all the modeling I’ve seen and all that and all the research I’ve done around the subject and the different guests I’ve interviewed that actually is sustainable. Right. So, so that was. Yeah, so there was that. And then also. Because I have two kids, we have to keep the kind of child benefit. And so we have quite a bit of that, too. And because we’re technically like on the lower income side, because my wife and I are, we actually get pretty high Canada child benefit, right. So. So that actually helps a lot. So that’s really what we did in the semi-retirement in the beginning. It’s pretty much what we’re doing now as well. When I did that full retirement thing then, yeah, it was just living fully off the portfolio and I didn’t really the same thing except, you know, there wasn’t really money coming in from a job for like there was the podcast, but it was a relatively small amount at the time. And so, yeah, it was just you take the dividends, you take the child benefit, and then you sell off a portion of your investments, like the withdrawal rate that I liked was three and a half percent around there, maybe 3.25, like depending how conservative you want to get, but just ballpark. That’s what it was and that was enough. So we, we still keep our expenses really, really low. And that’s what allows us essentially to do that. And if, like I said, of the markets to take a dove, we had like a bit of a cash cushion as well saved up just so that I’m not stressing out overnight because the markets called it happened, right? It was like a 30, depending on what you invest in. Right. It was like a 30, 35% drop, depending on what you want. Right. So in those kinds of scenarios, I had some sort of cash and a high interest savings account set aside so that after the dividends off of the child benefit, I can still take some of those out to pay for our groceries or whatever. And so during good years, yeah, we had extra money coming in because I’m withdrawing a certain percentage every year and then see how many. Maybe we take some extra we buy some extra stuff, but that’s fine. The travel a bit more or whatever. On years when the markets are not doing too good, then yeah, we, we don’t encourage those unnecessary discretionary expenses. Right. And so that’s a set that’s again, in a nutshell, that’s how we manage it. It gets more complex than that. There’s a lot of spreadsheets and modeling that I’ve done and, you know, interviewed lots of financial planners, had them run my numbers as well to make sure this is sustainable. Like I’ve been researching this now for like seven years and it’s been an ongoing thing that I’ve been maximizing constantly. But I mean again, at a high level, sort of macro level, that’s essentially how we did it just living off the portfolio. And I mean, we’ve been lucky we haven’t had a 2008 scenario, right, where again, we had COVID, but then the markets recovered really quickly. So fortunately, I’ve been fortunate where the portfolio has actually been growing instead of decreasing despite us being retired. So that worked out pretty well.
Erwin Szeto [00:37:10] Amazing. So for someone who’s new to this subject, how much that month do you think they need to be able to make between all these all these income streams that you mentioned, like dividends from the ETFs part time job that used to between the podcast, child benefit training, childcare benefit. How much do you think the household needs to bring in?
Kornel Szrejber [00:37:29] Well, it’s really a function of how much they spend, right? Because it doesn’t really matter. I should say this carefully. Right. But the amount you make, like you can make $1,000,000 a year, but if you’re spending 2 million, you’re going to go into debt. Right. And people do that. And I realize that some people do that. But like you said, professional athletes. Oh, exactly right. You hear all these. Different like musicians, like people that, you know, they made a ton of money in their twenties, whether as athletes or singers or whatever the case may be. They blew it like it’s gone. Right. And so really, yeah, the income thing is important, but the spending thing is really, really critical. So it’s really just a function of how much you spend. So yeah, I’d like to give you some actual numbers again because we have one car because we don’t have the mortgage, because we don’t live in a high cost of living area. Right? Because of all that, our expenses are relatively low when I don’t spend much, much money on things either. So we split. Basically, our spending is between 30,030 5000 per year. That’s basically what we spend. Yeah. And then so if you kind of want to do that math yourself on a spreadsheet or whatever and again, this is a crazy complex topic because there’s taxes, different investments are taxes, different ways, there’s different accounts, right? So this is not like you can just create your own financial plan, retirement plan on the back of a napkin or like a little five minute work on a spreadsheet. Right. This is something again, like I’ve been researching this forever, but, but I mean, just to sort of give you a ballpark and something to aim towards. So yeah. So one, figure out what your actual expenses are. And again, for someone that wants to do the early retirement thing, like using something like 3.25%, 3.5% withdrawal rate. From all the research that I’ve seen and all the experts I’ve interviewed, that many with an overwhelming majority of financial planners who really know the stuff that actually model this out in software and spreadsheets and all that, they will say for an early retiree, that could be that could be sustainable. A lot of people might have heard about the 4% rule, but that was not intended for early retirees. Right. That was intended for someone that’s in the U.S. and then they retire at 60. They want to see if they have enough money to reach age 90. Right. Which is a very different proposition than some money that retirees and they’re not 32 or 30 and they’ve got like a 60 year retirement instead of a 30 year retirement. Right. So that’s my 4% rule you’ve got to be really, really careful about. Yeah. So hopefully, hopefully that answers your question, like the one that what I sort of subscribe to now because there’s all these different ways to live off your portfolio. The one that I personally like that I feel comfortable with is a variable percentage withdrawal strategy. So what I do is, as with the 4% relative, a static. Come out. And again, this is like a whole deeper conversation and we can get into it if you want. But with a 4% rule, take a static Y thing, right? So let’s you have $1,000,000, 4% is $40,000. And then you adjust for inflation every year and you’re taking that out every single year. That’s the kind of assumption in that rule. However, the big negative behind that rule by of just following that blindly is that when the markets are tanking, you’re still taking out 4%, which like maybe you should have got less because you’re selling stocks or your ETFs at a low. When the markets are doing really good, you’re still only spending that maybe you can actually spend less, maybe you can actually spend more because the markets are doing good. So I personally like the more variable approach. So what I will do is I’ll actually use I like using 4%, but on a variable rate of our portfolio, is that like just to keep the math simple, let’s say $2 million then. Okay, we’re going to take we can take 40,000 out because that’s 4%. But let’s say the markets gets cut in half, you know, which is pretty extreme example. That doesn’t typically happen. Right. But let’s say, you know, for a bit of time that the market falls by 50%. Well, then now we’re only going to take out of that. So now we’re only going to take out 20,000. Right? And then we get into questions like, okay, well, do you have a cash cushion to sort of called you off for that recovery? Do you have any other income sources like kind of child benefit, like real estate, rental properties, things of that nature? Right. And so you sort of want to model that our okay, let’s run these different scenarios and are we going to be okay? Am I okay? Maybe taking on a part time job because I don’t want to sell my like I don’t want to sell my ETF when the, you know, just went down 50, 50%.
Erwin Szeto [00:41:30] Some people just wanna stay busy too. People don’t like. Oh.
Kornel Szrejber [00:41:33] Exactly, exactly. Maybe I should use 50% like, let’s see, 30%. You know, that’s kind of maybe a bit more like realistic of a bad or like a really bad sort of scenario, right? So that’s how I, how I really think about it. So when you markets are doing really well, when they’re up like you know over 10% that okay that’s maybe when you take that Europe trip you want it to take when the markets fell 30%. Okay you’re not going to do the Europe trip that you’re sure you’re going to do. Yeah. You’re going to do things locally, right? Well, then, like the whole Kraft dinner thing, it’s like that’s when you can sort of think, okay, do I want to have a cash cushion so I don’t have to go that extreme, right? How much? Because it’s like the more money you save, that’s opportunity cost, right? Like if I have, let’s say 100, I don’t have a hundred thousand in cash because the opportunity cost that would be too high. But I mean, that can sustain you for a very long time, you know, if your expenses are low, right. But if you invested, let’s say 50,000 or that into the market, you know, if you’re, let’s say, expecting a percent long term return in equity markets, I mean, that’s a lot of money that you just gave up for that extra piece of mind. Right. So you sort of it’s very much a personal thing, right? Where how much volatility and how much stability am I willing to endure to actually get a bigger pie at the end of the day? Right. So it’s very much a personal situation, but that’s personally how I do it. Hopefully I explain that in a somewhat coherent way.
Erwin Szeto [00:42:46] Cornell, any financial advisors you I don’t know if the word recommend is the term because it’s a common topic, especially for more people who are more on the successful side of anything they invest in, like gold, crypto or whatever it is, real estate stocks, whatever. And it’s actually, I believe it’s hard to find a financial advisor to talk to this area. Where can folks find one?
Kornel Szrejber [00:43:07] Yeah, so, so, so the kind of organization that I’m a big fan of that I kind of recommend people to by default now whatever they want, some sort of help. And I have like a, I have an actual special sort of page set up or you can get like a free assessment type of thing, but it’s over. I build wealth Canada dossier slash enriched and that is basically a company called Enriched Academy and they have a lot of different cultures there that can actually help you. It’s really nice about them is that they don’t try to sell you investments, which is huge for me, right?
Erwin Szeto [00:43:40] Because I try to sell them mutual funds.
Kornel Szrejber [00:43:42] Things like that. They do not try to do that, which is which is a huge reason why. And so I’ve actually like gone through their coaching program myself and I’m very happy with it and I’ve tried to like to get them to and suggest once just to see if they’ll do it and they won’t, which is great because I want to sort of, you know, test drive before I recommend this to people, right? Because a lot of people listen to that to the show, so and so they don’t, which is great because in Canada there’s such a huge conflict of interest. So many, like you said, it’s hard to actually find like a good fee for service financial advisor that’s not trying to sell you something on the side. And now we’ve gotten to this point where it’s crazy, where like people know that they should have a fee for service, financial advisor or planner.
Erwin Szeto [00:44:16] So they don’t want to find one.
Kornel Szrejber [00:44:18] So they can’t find what? And even people and there’s even advisors out there who actually do sell products but still call themselves a fee for service financial planner because it’s not regulated like anybody can call themselves that technically. Right. And so you get people are like, oh, I think you are such a planner. And then a few sessions and they’re trying to sell you like high fee mutual funds or other investments, right. So yeah, so.
Erwin Szeto [00:44:36] So kind of the ones. I’ve asked some friends for recommendations and they referred me to someone and they won’t talk to you on this. Your 5 million other assets under management.
Kornel Szrejber [00:44:44] Yeah. Yeah. And that’s the other, that’s the other type of financial planners out there which can be really good. Like there are some of the good ones that I know like I’ve had, I’ve had Ben Felix on for PWI Capital before. Like they’re, they’re a very reputable company in that field and they’ll do like they do with assets on. A management model where they will take a percentage of your portfolio as their fee. But they’re not trying to push your product either. They’re not trying to sell you some product because they get a commission for on the backend. So I am a fan of those guys as well. But then the challenge that some people have is that, yeah, they’re more for the higher net worth people, right? So I forgot what their minimum like I think I talked to, I interviewed another one of their staff at one point and I think at that point she said like over a million, I believe was sort of the cutoff. Off they go, make some exceptions. Like if someone’s like a, you know, young doctor like so they’re obviously going to be above that eventually then that. Okay, but, but generally I don’t want to put words in your mouth that this is just what she told me, like food is back. So still kind of what you’re saying, right, is, you know, there are places like that that are reputable, that do things well. However, you do actually need a pretty sizable portfolio to do that. Right. And then so but for places that people that don’t have that large portfolio yet, which is the majority of Canadians. Yeah. So these days I’m pretty much sending everyone over to, to 200 academy because yeah, they, they don’t sell the product. You just, you’re paying them like a flat fee. So there’s no commission. They don’t pick a percentage for you, nothing like that. You’re basically paying for advice and they optimize different things in your financial life so that they’ll do investments, but also like look at insurance and your cash flow and things like that. So. So I’m a really big, big fan of that. And that’s like so I actually I partnered with them because I’m like, look, I need someone that can help a lot of Canadians. Like, I can’t just have one, a one person show. There’s just too many people that, you know, that I kind of I’m going to be sending you once I’d like, you know.
Erwin Szeto [00:46:26] Break someone too much traffic, bring it back to people, then your listeners could be angry. You’re just trying to try to help people and it goes sideways.
Kornel Szrejber [00:46:35] Exactly. Yeah. Because I did that once where I had like one financial planner that I would recommend people to. And then like we did one thing together, like it was at the summit that we talked about. And after one summit he was booked for the whole year. And so it kind of so it’s like, okay, well that’s great. Like I’m super happy for them, but I don’t want to keep sending people that way. And they’re like, Oh yeah, you can talk to me in three months. Like, that’s not a good experience, right? So, so within me, I’m like what they’re doing because they actually have like people they can scale up. And I’ve actually gone through the process myself, so I trust them. I know they’re not going to try to sell some garbage to people that I, you know, send their way. And so, yeah, so I’m a big fan. And like I said, they do like the free assessment like really for people that I sent to them, they do a free assessment thing. So yeah.
Erwin Szeto [00:47:15] We’re not going to like it when they talk to me. I like Cornell sent me well, to be honest, like none of my stuff out of all my stuff costs more than like what it costs to live in a year. One of my stuff cost less than that. Can we have we have a lot of staff. I know you can’t see beyond that door, but there’s a whole bunch of people on that door. None of them eat for that. Cornell, I’m loving this, by the way.
Kornel Szrejber [00:47:48] Also, too.
Erwin Szeto [00:47:49] As often with I’m sure you’ve run into them like real estate folks, they’re often trying to build empires.
Kornel Szrejber [00:47:55] Yeah.
Erwin Szeto [00:47:57] They’re so focused on growing top line in net worth that they often and then they often forget about why we got into it.
Kornel Szrejber [00:48:04] Was for the freedom, right?
Erwin Szeto [00:48:07] Right now it’s.
Kornel Szrejber [00:48:08] A common trap, not just with real estate people, but just with as a real estate investor person, especially once you get to that higher level, we own multiple properties. I mean, at that point, you’re basically a business owner, right? And so it’s very much like there’s a very common entrepreneurial trap, right? Where you do this for freedom and do not have to work crazy hours and then you end up working more hours than if you like, just, you know, you have more instability than if you just ended up working for someone. So I hear you. I hear you have a record.
Erwin Szeto [00:48:32] So what does life look like for you? How many hours a week are you working, for example?
Kornel Szrejber [00:48:36] So, yeah, so I’m trying to really I’m trying hard to really stick to the, you know, semi-retirement part time piece. So I’m trying to do only 20, just like 20 hours a week and yeah, so, so like I’m actually experimenting with sort of, you know, the lifestyle thing. Like, you know, 20 seems like a good starting point because I figure with that I can sort of get that intellectual stimulation, you know, the problem solving stimulation. I get to work with people that I actually want or like smart people working with smart people to solve problems and things that you actually want to fix is actually enjoyable, right? So, so I’m sort of currently my hypothesis is that with 20 hours a week, I can fulfill that intellectual, creative person like interpersonal relationship piece sufficiently to keep me happy. And then the rest of the time, basically the focus is on health and family. So you have huge health focus because it’s like, what’s the point of being retired or semi-retired if you’re going to die early because you’re obese and you have heart problems and things like that, right? So I work really hard on that piece and then then in the family, things really, really critical as well. Like I said, I have two kids, a wife. So, so yeah, just to spend time with them, especially because from what I hear from other parents is that once the kids get older, they want to hang out with you less and just and my kids are three and seven, so they’re at that age now where it’s like they actually want to hang out with me and enjoy me and stuff. So yeah. So I’m really. Looking out for I’ll do it because I know the end is coming. But they’re going. To. It’s not cooled to hang out with that is what. Right. So. So those are the priorities. Yeah. So I might get more involved probably when they are once they’re both kind of, you know, busy with their friends. I don’t want to hang out with each other anymore. Yeah. Yeah. Yeah, I heard that even before that from something like, I suppose someone’s like 14. Like I will see. It’s probably different from depending on your kid and that kind of a thing. So I’m always going to kind of want to be really involved, but I realize now it’s like there’s a lot there. There’s going to be more. But I think so. I think eventually, once they’re sort of gone or they, they, they want a lot less time together, then I’ll probably focus more on charitable type work. That’s my current plan. And so fortunately I have a podcast and I have the summit which has a pretty big audience. And so basically to leverage that where it’s like, hey, we’re going to provide financial literacy like we always have and we’re going to help everyone. But let’s incorporate a more like charity element to it, right? Like whether it’s like they can eat in food banks, something like that. So like bring a percentage of profits, go towards a food bank or, you know, things of that nature, maybe even start my own charity or whatever. So, so we’ll see. But that’s kind of the plan right now.
Erwin Szeto [00:50:59] That’s pretty cool. Yeah, my kids are six and seven, so their bubble is small, so they actually think I’m strong or I’m good at what I do. So that’s broken. And in America.
Kornel Szrejber [00:51:12] They look up to you right off the bat. It’s like, Oh. I’m my dad doesn’t know what he’s talking about. Yeah, yeah.
Erwin Szeto [00:51:17] And by the. Time my son’s 16, he’ll be, I’ll be looking up to him, like, physically, I mean, so.
Kornel Szrejber [00:51:22] Oh.
Erwin Szeto [00:51:23] Let me tell you what. Talk about charity. My wife and I, we’ve had our own charity since 2016.
Kornel Szrejber [00:51:27] No. Yeah.
Erwin Szeto [00:51:28] So we registered charity. If you want everyone to talk about logistics and how to start and stuff like that at all.
Kornel Szrejber [00:51:33] Yeah, that’s very that’s very much of interest. And yeah, something I definitely would be, would be interested in learning about. Like now it’s sort of like, okay, let’s get time to your kids, make sure they’re set up for success kind of thing while they’re still impressionable. Because I feel if I take that the charity thing a lot now, then the time’s got to come from somewhere. And but I think I think for sure, once that starts not being as time intensive, the charity thing would be awesome. I’ve always been a fan of that.
Erwin Szeto [00:52:00] We just we just donate our own money to the charity. And I work with a wholesaler in Toronto and a wholesaler is actually the wholesaler for like other big retailers like, like Walmart for example.
Kornel Szrejber [00:52:11] Okay.
Erwin Szeto [00:52:12] Yeah. So for this, for this Christmas, for example, or buying winter coats and shoes, those are two of the greatest needs for kids right now. So we’re just oh, okay. We’re buying around $20,000 worth, I think then and then we’re going to drop it off to the schools and Hamilton, Ontario. It’s not that that’s awesome. It’s not that bad to set up. Okay. I should clarify again, my wife, my wife’s an accountant because, you know, you understand that accounting for corporations. But charity, ours is structured. Our charity is a corporation, but like it’s donated. Right. But the significant costs for any charity to, to just to do the accounting for.
Kornel Szrejber [00:52:49] Right.
Erwin Szeto [00:52:50] Yeah.
Kornel Szrejber [00:52:50] So, and that’s what’s kind of like keeping me from like starting my own, for instance, is like, okay, I got to learn to do all the accounting behind it and there’s all this government regulation and all the stuff. So yeah. Yeah, yeah, yeah.
Erwin Szeto [00:53:01] If you can imagine that it’s been abused heavily.
Kornel Szrejber [00:53:04] Oh exactly. Exactly. So I, so I get why they have to do it. So, but, so it’s like I’m kind of like if I’m going to do it, I want to do it right or piggyback on an existing charity. Right and say like, look, I’ll just partner with you guys and I’ll, you know, donate a portion or send people your way, that kind of a thing. I want to support your cause like that. There’s different ways of doing it right. So, but, but that’s awesome. I’m stuck. So great to hear that you’re doing that. My thing. What the other like the whole thing is sounds great. Kind of the one I had top of mind was with attrition. Um, so like, especially like, you know, if we’re going to like lower income schools or areas where maybe the kid doesn’t have enough nutrition to beat poverty, like how can you do well in school if you’re starving, right? And you can focus that kind of a thing. So to help families sort of in that area is also it hurts their brain development and seeing some research about that, how it’s like if a child is deprived of certain nutrients when they’re younger, it actually like impairs their brain development, which actually hurts them long term. So I mean, that’s and it’s to me, it’s crazy that in Canada developed country with all this money that that kind of stuff actually exists, right? It blows my mind. So. So yeah, it’d be good to be a positive force in that area for me personally. So that’s kind of what’s on my radar right now. But I’m trying to again, still be a very be a very, very present dad.
Kornel Szrejber [00:54:15] And.
Erwin Szeto [00:54:15] Shut out of the podcast. I have friends that that leverage our use to our charity as well. That’s awesome. So that’s the new directions coming into our charity. We have a separate page and link for them. So all the money is earmarked for them. Yeah, yeah. Right. So they don’t have to set up because not everyone is an accountant.
Kornel Szrejber [00:54:32] Yes.
Erwin Szeto [00:54:32] So just to do it to do with their own accounting. Yeah. So yeah, just leverage.
Kornel Szrejber [00:54:37] I appreciate telling me this. It’s just inspirational. Yeah. I get I mean, I’m excited about doing something like that for sure.
Erwin Szeto [00:54:43] Awesome. So Cornell, so has the like fair questions? Let’s go back to you mentioned before, but it was really specific. But if you were to do it all again, what would you do differently? And then the other way to phrase the question is like, what are you teaching your kids around life? Pendants. It must be weird for them. Like when they play, when they tell their kids parents or their kids, like what you did with your dad do at home. He talks to people on the computer. A three does for a living. He’s not a fireman. My dad’s a fireman.
Kornel Szrejber [00:55:16] Yeah.
Erwin Szeto [00:55:18] Yeah. What do you teach your kids? What would you do differently?
Kornel Szrejber [00:55:21] Well. The three year old is just. I mean, he’s three, right? So he’s not. You know, he’s one of it. Yeah. So he’s still too young for me to have conversations like that with him about both my daughter, who is seven and she’s in great two. Yeah, I saw it with her. I’m still trying to figure it out. I don’t have a best practices solution to say, Hey, look, I’ve researched this for days and here’s that. Interviewed a dozen people about the subject and here’s sort of what I recommend based on all the research. So I don’t have anything like that right now. It’s something that I’m working on and trying to figure out now because I’m noticing now in grade two, even in grade one a bit, they are, you know, they go even play an app online and they’re out and they want to buy something in the app. And it’s like, okay, do you just give them the money? How do you make them earn it? You know that kind of a thing, right? So right now I would say she’s at that age where it’s very much top of mind for me. So I’m trying to figure it out. So I don’t know. Yeah. I don’t really have any like gold standard things that I, that I’ve learned yet because I’m sort of experimenting and in the research phase right now. But the big thing that I’ve definitely that’s very much that I’ve been trying to kind of instill in her is that you’re not just given things that you have to actually earn it, right? Because that’s how it is in the real world. Like, you know, if you get something for doing nothing great, I’m happy for you. But for the vast majority of people, you actually have to earn things right. And so that’s kind of one thing that I’ve been like, okay, you want to buy this app? Okay, well, you know, is there some extra chores that you can do? Can you help out in this way? You’re so already teaching them like, okay, you do some work, you know, you do something of value to someone and then you get compensation for that, and then you can use that to spend things right and then you can spend all of it at once. Or do you save some of it or do you save all of it? Right. So they’re starting to have those conversations just so that they understand the relationship between actually like working and earning money and getting something right. And so I think that’s really, really critical. But then it’s got to the thing that I struggle with that I haven’t really figured out yet is how do you still because you don’t want them to be only purely motivated by money either, right? So there’s the whole thing about like intrinsically like I should help my dad with this thing because he’s family and we’re a family unit and we’re a team and we’re supposed to help each other out as opposed to cause I’ve heard, you know, I’m sure you’ve probably heard parents, too, where they’re talking to their kid, asking to do something, and the kid’s like, Well, how much are you going to pay me? So obviously you don’t want that either, right? So, so it’s a delicate thing that like, yeah, so I, unfortunately, I don’t have a really optimized answer for you because I, I’m I’ve got certain things that I’m that are important, but I haven’t really narrowed it down. The, the other question about kind of if I was to do it all over again, what would I do? So the whole being a dual income household right away was definitely a very good move. The buying a house right as soon as possible thing was not a good move. So that’s something I would do different. So we bought a house really early on and what happened and it was in the GTA area, like the Toronto area, and we thought, oh well yeah, we’re going to be here forever, right? Because this is where the like all of the jobs are, that kind of thing, right. Well why wouldn’t we be here, right? So we bought a house as soon as possible and it turns out we actually didn’t like living in the GTA. We actually liked it back home. Our family was here, it was home. We just enjoy it more here. And so I’m sure a lot of your listeners already know you don’t buy a house if you think that you’re only going to own it for a very short, relatively short period of time. Right. You wonder like usually I think it’s like people say five years plus, you know, at least kind of five years, right, that you want to expect to own it. And so that was a mistake. So I definitely would I would have rented first to see if we actually like the area, especially in early in your career. Right. Things change a lot, right? Like you may decide to change careers. You want to be sort of mobile so you can move to take advantage of different opportunities because you don’t have kids yet. Probably so, you know, you don’t you don’t want to like when you have kids, it’s different, right? Because then you don’t want to switch schools for them all the time, that kind of thing. Right. So that that’s one piece I would do differently. And then on the investing side, which I’ve already alluded to, right, instead of really pushing the paid on the mortgage ASAP, I would have just done total market index investing to start things off. Like for most people I would say just do asset allocation ETFs. We just buying one ETF will automatically rebalance when your portfolio is small, a little bit extra and beyond that you’re going to pay is negligible because your portfolio is not that big yet because the way the fees work. Right. It’s a percentage of your total of the base of your total portfolio or however much you’re investing in that ETF. And so if you have like $100,000 portfolio, that’s not a very big amount. When it’s 500,000, that’s a different story, right? If you’re just getting started, you don’t have you don’t even have $100,000 portfolio yet. So I would say just do as allocation ETFs. In the beginning, I would encourage you to go as high equity as you can. So like for me, like I like I like executive equity, which are the All Equity Association ETFs. Let me just try asset write equity and equity. Those are those are the tickers if you ever want to look them up. Again. Do your due diligence. I’m not giving you financial advice like general help, helpful tips in education, but that’s that. So that’s what I would do in the beginning. Then once the portfolio got bigger, then I would start, okay, now let’s look into like once the portfolio was well into the six figures, then I would say, okay, now let’s actually look into potentially buying individual ETFs because then you can optimize things a little bit more. So that’s what I do now. So different ETFs, depending what’s in them, they are taxed differently, depending on which accounts they are in. And so there’s a lot of sort of pack strategy that you can do around that, which again is not worth doing when your portfolio is small because this is like we’re talking like a percent of a percent kind of savings, right? So again, if your portfolio is seven figures or like mid six figures, that actually can add up and that might be worth your time to just spend time and optimize for that when your portfolio is, you know, under $100, maybe 100, 200 K, I wouldn’t even really bother with that because it’s not worth your time in this. You’re like, Look, I want to learn it anyway. I’m going to be doing this in the future anyway. I enjoy it that fine, do it as like because you actually enjoy it, right? But so that’s, that’s really that’s really what I would do. And for people that don’t want to get really complex into like the tax planning and optimizations and things of that nature, then you could just do asset allocation ETFs all the way through. And like I’m in the space, so I and I know some really smart people with significant investment assets who totally have the ability or the knowledge and resources to optimize things in that way. But they still choose not to. They still just buy an asset allocation ETF because it’s like, look, I’ll pay a little more and more. Yeah, maybe it’s not like perfectly tax optimized, but you know what? It’s so much easier and it’s just I just want it. I can just buy this and then move on with my life and do other things right. And so, so I get it. Like you’re paying for the convenience. And for some people that’s totally worth it. For me, I’m like an optimizer. I love just optimizing every little thing. And so for me, I do enjoy buying the individual ETFs. Yes, it’s more work, but you’re saving like, you know, thousands of dollars in terms of like fees and taxes and things like that. So for me, it’s worth it and I’m okay, you know, jumping the hoops to do that because I’m a I’m a money nerd, but that’s not for everyone. So yeah. So I hope I hope that answers your question in terms of like if I was to do it all over again, that is what I would do. And if you’re like really into real estate, which I suppose a lot of your audience is because it’s a real estate show, then yeah, like I like I think a big one would be and I tried doing this, but my wife refused that. I couldn’t sell her on it. But a big one is Yeah. If you have, if you buy a property that’s like a duplex, right. And then you live in one part of it and then you rent out like the basement or you live in the basement and you rent to the top or, you know, whatever the case may be. I mean, that can help you so much in terms of cash flow. It’s incredible. So I tried so hard to get my wife to agree to that, but she’s like, No, I don’t want other political loans. And it’s just very, very like, put her foot down. So I was not a good enough salesman at that time to persuade her to do that. But if again, if I if she was up for that, I told you what I’ve done, that if I was single, I would have done the roommate thing that we talked about. I would have tried to get financing or whatever where I could put out whatever, like at a reasonable rate so that I could live in one part and then rent the rest. You know, that would be awesome because then you get to enjoy the equity appreciation, right? And you got some people paying for your mortgage. Obviously, the numbers have to work. It’s not like you just do that blindly because you could get the wrong deal. Especially now with prices are so high in some areas where it’s like, I don’t know how people could possibly get some of these properties to cash flow as a rental. Like it just it just insane what some of these properties are going for these days. So again, it all starts to talk about.
Erwin Szeto [01:03:25] That in a time of how you know, how we meet their properties, cash.
Kornel Szrejber [01:03:28] Flow. Yeah, yeah. That’s a whole other animal, right? But so it’s like, I don’t want should I just go blindly into it and yeah, just do that. The members have to work. You do have to actually bust out the spreadsheet and have someone like yourself or stick to professional, look through what they’ve done it before and say, Hey, are these numbers actually realistic? That’s critical, right? Because you could really mess yourself up if you actually do it wrong because you’re not buying $25 ETF. Right. In this case, you’re buying a several hundred thousand dollar property, probably like $500,000 plus, especially if it’s like a multi-unit thing. Right. So you’re really putting a lot pretty much all your eggs in one basket at that point. So you really want some expertize from someone that’s done it that’s not trying to sell you anything. Yeah, that was a long answer, but I hope that was.
Kornel Szrejber [01:04:10] The.
Erwin Szeto [01:04:11] Couple of quick shares I would never advise and I wanted to do this, but when my wife and I bought the previous house we bought, we were pregnant with our first. We bought a house with a basement apartment walk out. We bought it, put down 5% on it, and then we used all the leftover capital. We had to go buy three houses.
Kornel Szrejber [01:04:31] Ha. Good for you. Have you ever have. Pull it off? That’s awesome. But I can see gray hairs on the screen right now but have plenty. But I’m sure you’ve got more than me. I’ve 20, something like that.
Erwin Szeto [01:04:40] So I ended up putting down including each mortgage insurance we put down less than $40,000.
Kornel Szrejber [01:04:47] That’s incredible.
Erwin Szeto [01:04:47] And then the house appreciated. $600,000.
Kornel Szrejber [01:04:52] Nice.
Erwin Szeto [01:04:53] So six or seven years, that’s incredible. And then that’s even before the three properties.
Kornel Szrejber [01:04:59] Oh, that’s incredible. So I think you can.
Erwin Szeto [01:05:02] Advise that to me. One. And then I picked this I picked this quote up, not a quote, but on what to say. The kids, I picked it up on YouTube. I forget the lady’s name. But in an example where the child suggests buying something, that’s a bit on the frivolous side. She said, I’m sorry, honey, that’s not a financial priority for our household at this moment.
Kornel Szrejber [01:05:23] Okay.
Erwin Szeto [01:05:24] All right. At this moment. And then you can explain your priorities. I think it sounds a lot better than saying money doesn’t grow on trees.
Kornel Szrejber [01:05:32] No, that’s true. Yeah.
Erwin Szeto [01:05:34] Especially if it’s like your kids asking for, like, a donut.
Kornel Szrejber [01:05:37] Right.
Erwin Szeto [01:05:37] Very low on the priority list. And then low on the health list. Health rankings? Yeah. And then also with the charity our kids attend all of our charity events.
Kornel Szrejber [01:05:46] That’s also not something I think would be awesome from the kids side, right? As you get them involved in it in some way or at least attend. And that way they you’re leading by example, right, where you don’t just think about yourself and everything is for profit. And I’m always just trying to maximize the net worth, like you don’t want to instill those kinds of values, right? So that’s awesome. That’s, that’s so good that you’re doing that. And yeah, I think that’s going to be it’s a good thing. So you can kind of build the relationship with your kids while actually giving back, right? Which, which is awesome, right? Because you’re, you’re kind of you’re filling both buckets, essentially. Yeah.
Erwin Szeto [01:06:15] And for the legacy, if the kids are supposed to be part of legacy, which for all of us it is, they have a job to do. Yeah. Yeah. Right. But this will be part of your job for our kids at school. Martial arts, charity work. Those are your jobs. There’s no, no nothing about it. You have to do these things right. Are you getting kicked.
Kornel Szrejber [01:06:36] Out of this. Corner? That’s awesome, though, uncovering the charity piece. Great.
Erwin Szeto [01:06:41] Thanks so much for doing this one last time. Where can people follow you?
Kornel Szrejber [01:06:45] Yeah, so you can just search, build Wealth Canada in your favorite podcast player and you’ll see that pop up there, right? You get to interview basically the top experts in financial planning, investing in taxation, so that you can pretty much learn for that specifically for Canadians. Or you can just go directly to the site, which is Build Wealth Canada dossier. And then the other place, like I said, you can get the free tickets to the financial summit and that’s over at Build Wealth Canada, that’s slash summit and that will automatically take you that page and you can sign up. And then as soon as the tickets are ready, I will email them to you and you’ll be all set. And again, it’s similar to the podcast that’s best practices from top financial people in Canada. So I’m sure you’ll learn. Absolutely. And again, it’s free and I’m yeah, I’m sure you’ll enjoy it.
Erwin Szeto [01:07:27] And I cannot wait for your high school course.
Kornel Szrejber [01:07:29] Coming to.
Erwin Szeto [01:07:31] Cornell.
Kornel Szrejber [01:07:31] You know, the pipeline. Sounds good because there’s so much free time, but free time at.
Erwin Szeto [01:07:39] Cornell again, thanks so much for your time.
Kornel Szrejber [01:07:41] Also lets me out. This was fun.
Erwin Szeto [01:07:43] Thank you.
Kornel Szrejber [01:07:44] I do get by.
Erwin Szeto [01:07:52] Before you go, if you’re interested in learning more about an alternative means of cash flowing like hundreds of other real estate investors have already and sign up for my newsletter and you’ll learn of the next free demonstration webinar I’ll be delivering on the subject of stock hacking. It’s a much improved demonstration over the one that I gave to my cousin Chubby at Thanksgiving dinner in 2019. He now averages 1% cash flow per week, and he’s a musician by trade. As a real estate investor myself, I got into real estate for the cash flow. But with the rising costs to operate a rental business, it’s just not the same as it was 5 to 10 years ago when I started. Never forget a cash flow reduces your risk. The more you have, the more limbs you can absorb. And if you have none or limited cash flow, you’re going to be paying out of your pocket like I did on a recent basement flood at my student rental in St Catherine’s, Ontario. If you’re interested in learning more about For Free from a newsletter at WDW DOT Truth About Real Estate Investing Dossier into your name and email address on the right side will include in the newsletter when we announce our next Free Stock Anchor demonstration. Find out for yourself what so many real estate investors are doing to diversify and increase our cash flow. And if you can’t tell, I love teaching and sharing the stuff.