Confessions of a Law Breaker

Confessions of a Law Breaker

I am a huge Dave Ramsey fan. His Financial Peace University (FPU) course is one of the hottest hits in the US Financial world. Actually I went to see the Ramsey group in the summer of 2018. I had a tour of the facility and talked with one of their VP’s extensively (Dave was on holidays).

I asked if the FPU course was going to be available in Canada. Well, the long story short is that it may take a while. The first reason is that the course isn’t even allowed into our country because they use the word “University” when its actually not a qualified… University.

I know of many people who have bought the course (system) and have been using it in small groups for years. The problem is… technically… its illegal.

Well lock me up because I’ve just finished facilitating my first 9 week small group financial freedom course (baby steps). By facilitating this course (using Dave’s material I purchased) I may have broken a regulation or two but some things (in my opinion) just need to be broken. I strongly promote Dave’s material during the course and I do not charge anything for the course (just to avoid potential legal grievances).

However, there are several things that Dave teaches for the US market that are different here in Canada. I’ll provide them for you in summary form.

When Dave says 401K the translation in Canada is RRSP.

We (obviously) do not have medical insurance.

The tax laws in the US regarding home equity is very different here in Canada. In the US tax payers can deduct the interest on their home mortgages while in Canada you cannot. However, there is capital gains on your personal dwelling in the US but not in Canada. This means that paying interest on your home mortgage in Canada is using “after tax income” (more expensive) and the Capital gains on your home is “tax free” (beautiful words). Therefore paying down your mortgage is of much higher importance in Canada than in the US.

I also have a different personal view regarding mutual fund performance than does Mr. Ramsey. He promotes 12% returns in mutual funds as an achievable figure. Without arguing its validity in the US, I would state that it is unreasonable to expect 12% in Canada (especially in your RRSP). Canadian’s save 3x the percentage of income per capita that the average US citizen does (2% US verses 6% Canadian) and since RRSP’s are restricted to 80% Canadian content and the Canadian economy is 1/10th that of the US there is a disproportionate amount of investment money available in Canada than the US. Simple supply and demand means that mutual funds in Canada will not produce the same returns as in the US. Therefore Canadian mutual funds may be of LESS significance to your retirement goals than are generally stated from the industry. The understated benefit for your retirement plan is probably your home mortgage. Simply put, pay down your personal mortgage with the swiftest of gazelle like intensity. Remember, this is my personal opinion only.

January brings a fresh look at a new year. Many use this season to evaluate their personal and business finances. I strongly suggest finding the right mindset by listening to Dave Ramsey this new year. Make a commitment to listen to him every day during the quiet and lonely times of your day. Fill your mind with strong thoughts of vision, hope and the determination of a sound plan of action.

I think I’ll break the law again and host another FPU in February. For those who would like to participate in providing their stories of hope and success I encourage you to email me your stories. I will try and return our thanks digitally to you.

Let’s use this year as a perfect start to achieve our financial freedom goals. Change the hind site to for site for 2020.

Robert Scheper

Robert D Scheper has a Masters Degree in Business Administration and is the author of two books, “Making Your Miles Count: Taxes, Taxes, Taxes” and "Making Your Miles Count: Choosing a Trucking Company".

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