Certified financial planner Frank Wiginton is the first to tell you he no longer manages client money or sells financial products. Instead, as founder of Employee Financial Well-Being, a Toronto-based organization that promotes financial literacy education, he is persuading companies and organizations to step up and add financial literacy to their list of wellness offerings.
He recently took some time to talk about procrastination, putting financial affairs in order and achieving financial success, one (baby) step at a time.
Your book is called How to Eat an Elephant: Achieving Financial Success One Bite At A Time . You’re telling people how to plan financially by breaking the process into accessible chunks.
That was the idea. There are enough books out there about what stocks to buy or how to become rich. But most people are not concerned with that. They’re concerned with trying to figure out how to make it to the end of the month. They want to know what to do first.
I used to say to clients, “I need you to give me all this documentation so I can create your comprehensive financial plan.” But that would freak them out. So I learned to say to them, “Why don’t you just get me this one document to start with?” Eventually I’d get it all, one bit at a time.
At one point you write that money is finite. But looking at the high household debt levels and credit use today, apparently not everybody agrees with you.
That’s a valid point. Money is finite, but in our low-interest, give-everybody-credit society, finite is a grey term. That’s a problem. When we look at the impact debt has on people’s physical, psychological and social attitudes and behaviours, it’s huge. The impact is just crushing. People are burying a huge amount of stress, which is causing them to sleep less. It causes depression and anxiety to the point that people are becoming medicated to deal with these issues. It’s destroying relationships and families.
The book is broken down into 12 chapters, one for each month. Do you think some readers might get stuck on the debt chapter and not carry on to finish the remaining ones?
Well, you can only do so much for people with a book. But the point is it’s not just about sorting out the numbers. It’s about changing how you think about money. It keeps coming back to that fundamental message: You need to know where you’re spending your money and what you’re spending it on. A lot of people haven’t tracked that yet, so they walk through the world in this kind of denial, zombie state about their finances, hoping that one day it will all work out.
You say yourself that things can change in a year. You can lose your job, get divorced or get sick. So, realistically, how should we handle these financial setbacks?
It’s about the planning. Put some extra money away each month, even if it’s just a small amount. When people lose their jobs, that’s often the time when they get their financial affairs in order, but unfortunately, that’s too late.
Your day job is as founder of Employee Financial Well-Being. Is it really the job of an employer to teach employees how to handle their salary?
The reality is, your employees are your biggest asset – and your greatest liability. It’s not like financial stress gets left at the door when they walk into the office. John can be having a really bad day. He just had a fight with his spouse because they’re struggling with their finances. He comes into work and snaps at his colleague, Mary, and now she’s put off.
Workplace wellness programs usually don’t include financial education, but perhaps they should.
Right. If you’re using fitness to de-stress employees, that’s great. But when then they walk through the door at home and they see that pile of bills, all that stress instantly comes back. After years of doing financial planning, I know that education can have a profound effect on people’s lives in a positive way. I firmly believe that people can have a better quality of life if they can just take back control of their finances.
Back to the book. You say after completing the tasks outlined in each month’s chapters, you’re supposed to reward yourself. What’s an appropriate reward? That demonized $7 latte?
It’s about making sure you’re motivated to keep going. So find simple pleasures in life. Maybe you get your favourite ice cream. It’s not about rewarding yourself with a vacation to Tahiti, even though we all want to do that in the dead of February.
So what’s your preferred reward?
I have a number of friends who own sailboats, so for me it’s about getting things done so I can get out on the water. That’s Financial Planning 101, by the way: Make friends with people who have better stuff than you do.
This interview has been edited and condensed.