Doug Allan, a CPA and vice-president of a commercial real estate investment firm in Vancouver, released A Fighting Chance: The High School Finance Education Everyone Deserves through Tellwell Talent last week.
The book’s release coincides with big global buzz around GameStop’s recent skyrocketing stock price, as short squeezes and “meme stocks” have ignited an interest in the market, for better or worse, for people of all ages.
“In today’s world with social media, there’s so many stock promoters out there – last week’s GameStop activity is a good example of it – with the promise of, ‘Put your money into this stock and you’ll get rich quick.’ Those almost always aren’t going to be true,” Allan tells the North Shore News. “People are treating it a little bit like a casino. They just throw money at a hot name and hope it goes up.”
And while stock frenzies driven by Reddit boards and armchair market gurus on YouTube are the rage right now, Allan’s book attempts to offer readers – and in particular, readers with school-aged children – a more measured, practical approach to their personal finances.
Reflecting on his high school finance education (“It was zero, absolutely zero. I’m sure it was probably the same for you.”), Allan’s thesis is that financial literacy, as well as a strong savings foundation, should start in youth.
“I just felt like people are being set loose from high school to set up to fail financially and make poor financial decisions,” he says.
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Across 10 easy-to-digest chapters, Allan highlights a number of key topics he wished he’d been introduced to before he was able to study commerce at McGill University and go on to become a chartered professional accountant.
Among the most important financial literary topics he believes high schoolers should have a strong grasp on is the long-haul invest of compound interest.
“The main reason is the magical powers of compounding,” says Allan. “Time is your No. 1 ally when it comes to growing your wealth, and so if you’re able to start – even really modestly – as a teenager, that money will grow investment returns and those returns will earn returns. Those earnings will snowball.”
His guidebook also outlines a number of topics that may seem obvious to some adults – though many of them might have had to learn about it the hard way if it wasn’t drilled into them as a teenager first.
In this regard, Allan teaches everything from creating a household or personal budget, managing a credit card and making sure we don’t spend unwisely in our youth in a way that will put us into debt when we’re older.
“These are habits that we should generally learn early in life,” he says. “Having to make significant sacrifices later in life is much harder than getting it right early on.”
There’s also certain sections where he entices the reader to question the perceived financial wisdom of generations past.
“I think most people think it’s a good idea to retire with your house paid off, with no mortgage. Does that make sense anymore when interest rates are 1.5 per cent per year? Things like that might trigger a thought process,” he says.
Allan, who in addition to his professional work has served as a board director for a number of non-profit and for-profit enterprises, including as treasurer for Polygon Gallery, wrote his book to help people have a fighting chance in the financial world despite limited educational opportunities to learn about this stuff in one’s primary years.
“I tried to keep the book a very manageable length. I didn’t want to write an encyclopedia,” he says. “The most value I can produce is just my financial expertise and experience.”