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Alain Guillot Show

Jul 8, 2018

Kornel first became well known for paying his mortgage in his 20s.

In a society where people are making mortgage payments way into their 50s, Kornel decided he didn't want any of that, he didn't want to be a slave to his bank.

Once his mortgage was paid off, once he and his wife have learned the virtues of frugality, by saving 50% of their income, they focused all their energy into pilling money in their retirement accounts. By age 32 Kornel was Financially Independent.

Kornel prefers freedom to work the 9 to 5

In a society, where people live from paycheck to paycheck, in a society where we are manipulated by advertising companies, and where we are persuaded to continue buying the latest this or that, Kornel decided to ignore the noise and focus on what's really important,  freedom to spend time with his family, freedom to build his days as he wants to instead of obeying the whims of an employer.

If Kornel can do it, anyone can do it

Kornel had a middle-class salary, nothing spectacular. But his priorities were different. Instead of spending, he opted for saving, and by age 32 he had accumulated enough wealth to stop working if he wanted to. This is a testament, that we can all do the same. We need to increase the gap between what we earn and what we save, and we too, we can have the opportunity to retire early.

Why did Kornel create his podcast?

In his search to educate himself about personal finance, Kornel decided to create the Build Wealth Canada Show, one of the best personal finance podcasts in Canada.

Kornel found that there is a lot of good information out there, but there is a lot of bad information as well. And sometimes, it's hard to tell good information from bad information. What makes things more difficult is that there are a lot of soft pitches to sell something to the person who's consuming the information.

How can you tell which information is good? Which information is mediocre? Which information has a hidden agenda?

To find out the answer to those questions, Kornel started interviewing experts in different phases of the personal finance arena, he recorded those interviews and made them available to the rest of us.

Most actively managed mutual funds underperform the index

We spoke about the Spiva report, a report which shows that in the U.S. 84% of active mutual fund managers don't beat the S&P 500 and in Canada 81% of active mutual fund managers don't beat the Canadian index.

In spite of this evidence, most Canadian, own high fee mutual funds, because that's what their commission-based financial advisers seld to them. Most Canadians haven't done the homework to know that there are better alternatives out there.

There is a growing trend of some Canadians switching from commission-based financial adviser to fee for service financial advisers. But most Canadian are unaware of the utility of fee for service financial advisors and continue overpaying hundreds of thousands of dollars for inferior services.

There is not enough $$$ in real estate to compensate for the stress

Kornel also dipped his hands into some real estate investment, but after 5 years, he figured out that the profits are not substantial enough to compensate for the increased level of responsibility that comes with investing in real estate.

The best podcast episode

Kornel’s most popular podcast episode is: How to Save Thousands at Your Bank – Secrets of an Ex-Banker. Go check it out.

About how to negotiate with a bank. Where are the banks flexible or not flexible, how to get the best rates? What are the conflicts of interests?

How does Kornel manages his investments?

Kornel’s portfolio is 100% in equities. 1/3 Canadian, 1/3 US, and 1/3 international. After, the sale of his real estate, he may consider adding some bonds to his portfolio.

Notice, that the consideration of divesting some money into bonds, has nothing to do with his age, as many finance book suggests. Kornel reached financial independence, he hit his number, now whatever extra money Kornel have he could use it to play more aggressive or to play it safe.

Kornel teaches you how to invest

Kornel has a course on how to do index investing for Canadian investors. The course is only $97. He shows people how to go into investing in a comprehensive manner. I think that this course is of great value for anyone who wants to know how to invest their own money. I have a friend who uses the service of a financial adviser. All his money is invested in high expense mutual funds. My friend is paying thousands of dollars for inferior service. He would be so much better by taking a few hours of his day and learning how to manage his own money. Here is Kornel's course. This is NOT an affiliate offer, I get no commision for endorsing this course.