When Bruce Sellery wanted to draw from his allowance as a kid growing up in London, Ont., his dad pulled out a ledger and asked what he planned to buy with the money before handing it out. When Mr. Sellery was a bit older, he had a clothing allowance, which meant he could buy the latest pair of sneakers, but it would be at the expense of the next trendy item that came out months later. This financial consciousness and rigour has informed Mr. Sellery's spending and investing habits to this day – and his career. The TV host, professional speaker and author of two personal finance books, including his latest, The Moolala Guide to Rockin' Your RRSP, is cautious in his investing approach. Mr. Sellery, 45, recently spoke to The Globe and Mail about his investing style and why he doesn't try to pick individual stocks – at least not any more.
What was your first job?
I started working very young. I babysat, but when I was 13, my brother – who is six years older – sold me his lawn-cutting and snow-removal company that he built. He sold it to me for book value on all of the equipment and 50 per cent of Year 1 revenues. It was about $6,000 – a lot of money in 1984. I sold it when I was 18, using the same formula – book value on equipment and 50 per cent of revenues. I made money and saved it.
What was your first investment?
I've had an RRSP since I was 15 because of the income from the business. I started investing in mutual funds. When I started working at Procter & Gamble out of university, I got a financial adviser and invested in more mutual funds with them. Then I started to realize how poorly those funds were performing. It was while working at BNN that I really started to learn about the impact of fees on a portfolio.
What's in your portfolio today?
I'm a follower of a passive investment strategy. The bulk of my portfolio is in exchange-traded funds. It's my temperament. I'm not interested in trying to beat the market. I feel like I can get most of the way there by living below my means and letting the magic of compound interest rule the portfolio. I also had my head handed to me during the dot-com bust. I was playing the single-stock game. I do own shares of Procter & Gamble and BCE (BNN is a division of Bell Media, which is owned by BCE Inc.) from the stock-matching plan I participated in while working for each company. Thankfully, I happened to work for companies that have done well and pay dividends.
Do you hold any cash?
No. It's a strategic choice I've made – to be fully invested. When I think about an emergency fund, I think of access to cash versus cash on hand. I have a line of credit and if I were to have an emergency, I would use it. In my view, a lot of what people call an emergency isn't an emergency. If your roof leaks or your furnace breaks, that's not an emergency, in my opinion. It may happen earlier than you want it to, but you have to live with a buffer. All of those things are quite predictable.
What has been your best investing move to date?
Opening up an RRSP at 15. It set my habit of saving for retirement. I don't have any home runs because I'm not playing the home-run game.
What has been the worst investment to date?
I invested in 360networks. I bought after the IPO in 2000. Then it pulled back and I doubled down. I sold it all two years later for pennies a share, just to get it off my statement.
What did you learn from that?
If you're going to get into the single-stock-picking game, you need to have a bigger intellectual investment in what they're talking about. It's very difficult to pick a winner. Stocks can go to zero.
What advice to you have for others, based on your experience?
It's cliché, but live below your means and ensure your income exceeds your expenses. In our new culture, there is no shortage of things to want and no limit to how to pay for them. The ubiquity of credit and ability to use our homes as an ATM is not actually a good thing. Think holistically about what your money is for. If people thought more broadly about the life they're building for themselves over time, they might make fewer short-term decisions that run counter to what it is they really want.
This interview has been edited and condensed. For this series, a high-net-worth investor has investable assets of more than $750,000.