Episode 1.1 with Rob Carrick

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Text transcript

Kevin Press:

Welcome to Season 1, Episode 1 of the Canadian Advisor.cast, a podcast dedicated to financial advisors and the people that work with them. My name is Kevin Press. I’m Editorial Director of Advisor.ca and Investment Executive. We’ve laid out three goals for Canadian Advisor.cast. Number 1, we’re going to invite guests that matter to Canadian financial advisors. Number 2, we’re going to engage them in a way that we can’t with our traditional reporting. And Number 3, we will always be listening, both to our guests and to our audience. So if you want to join us, or if there’s someone you want us to talk to, let me know. I’m at kevin@newcom.ca. With that, let me introduce guest Number 1. Rob Carrick calls himself Canada’s Personal Finance Explainer-in-Chief. After 27 years writing The Globe and Mail’s highly respected personal finance column, Rob has decided to change things up, and he’s filing columns once every two weeks now, taking on speaking engagements and consulting work on financial wellness. Rob is one of those rare journalists that is both admired and liked. He’s been a fierce advocate for Canadian consumers, and he has a remarkable talent for making complicated financial ideas understandable. Please welcome Rob Carrick. Rob, so good of you to join us, help us pilot this thing. A lot of change going on for you right now. Talk us through what’s happening.

Rob Carrick:

So, first of all, I’m honoured to be your first guest and to have you say that advisors want to hear from me. I’m pleased to hear that because I’ve always had an interesting relationship with advisors over the years. And we can certainly talk about that, but just to update you, I stopped my longtime gig as Global and Mail personal finance columnist on June 27th. Kind of took the summer off and started, like, thinking, what would I like to do? And, the fall came, and now I’m doing exactly what you said. I’m doing biweekly columns for the Globe. I started a Substack newsletter. I’m starting to build my subs up, and I’ve taken on some consulting and some speaking, and I’m having a great time. You know what? I’m doing what I was doing before, but on a more measured, less frenetic basis.

Kevin Press:

What made this the right time for the change?

Rob Carrick:

You know, I felt that, I felt I needed to pull back a little bit and have more time to think and less time just, like, writing and producing content. I had a very brisk pace of production, and it became more brisk as the years went by because I was doing all my writing and then I was doing the Stress Test podcast, personal finance podcast for Gen Zs and Millennials. And I thought, “I barely have time to, like, see what time of day it is.” And I just thought, “I need a little more time. I need a little more flexibility into my schedule.” So, I said, “I’m retiring,” just so everybody would understand the concept of what I was doing. But, really, I’ve just gone independent, and now I’m doing what I was doing before but on a more selective, measured basis.

Kevin Press:

Take us back. How did you get started in financial journalism?

Rob Carrick:

Well, I was a general news reporter at the Canadian Press wire service. And my boss, who was the Ontario Bureau Chief, said, “We have an opening in the business department, and we’d like you to take it.” And I looked at them and I said, “Are you kidding?” Because business was the absolute last area I would’ve been interested in. But they said, “We think this would be a good career move for you.” And I took my boss’s word for it, and he was spot-on correct. You know, I started acquiring these skills as a business reporter. First of all, I covered the Bay Street business scene in the early ’90s and built up a lot of skills and understanding, you know, how business works and, you know, the stock market, and that sort of thing. And I moved to the Ottawa Bureau for Canadian Press, and covered the Department of Finance, covered consumer affairs, covered a lot of economic announcements. So I built up my knowledge of economics, took the Canadian Securities course, and, ultimately, I left CP and started at the Globe as an investment reporter. And I suggested to my boss that we should be doing more on personal finance because we weren’t really doing much. And he said, “You’re right. Would you like to do it?” And I said, “Hell, yeah.” And, that was 27 years ago.

Kevin Press:

1996. And, so what made you want to do the personal finance beat? That was something different than traditional business reporting.

Rob Carrick:

You know, it was, but I was at a point in my life, you know, young dad, homeowner, all these financial decisions flying at me, and I was trying to make sense of them. And I thought, “Other people must be as well.” And, you know, to give full credit, like, the Financial Post had Bruce Cohen was, you know, one of the original personal finance columnists in Canada. I was reading his stuff, and I was thinking, “The Globe should be doing that sort of thing, and I could be answering my own questions.” And, you know, through 27 years, a lot of what I wrote was answering my own questions.

Kevin Press:

You took on that role right in the heart of the dot-com bubble, too, right?

Rob Carrick:

You’re right.

Kevin Press:

This wasn’t an easy time to start a personal finance column.

Rob Carrick:

Well, it was a fascinating time because, not only was the dot-com bubble happening, but also so was the direct self-investing, you know, DIY model evolving then because, you know, discount brokers, as they were called then, had been around for a while, but they were really catching on because people wanted to get a piece of the dot-com bubble. So, my little entry into all this was to take a look at online brokers. And that’s actually how I began my, you know, 25-plus years of ranking Canadian online brokers or digital brokers, as I call them now. I got interested because everybody was doing it in the dot-com craze.

Kevin Press:

And when I think about your tenure, we got dot-com, we got 9-11, we’ve got the euro crisis, we’ve got the great financial crisis, a global pandemic. To wrap it all up, my goodness, what an extraordinary time to be, not just a columnist, but a personal finance columnist.

Rob Carrick:

Oh, for sure. And, you know, I would add the trade war into that as well because, although the tension levels have ramped down somewhat, in February and March the fear level, anxiety level among readers of the Globe was phenomenal to me. And I think it ranked up with all those other milestones you just mentioned.

Kevin Press:

Which was the most intense for you?

Rob Carrick:

Far and away, the global financial crisis. What got me there was how afraid industry people were. You know, I’m used to investors being afraid, and the people in the industry saying, “Don’t worry. It’s this and it’s that, and we understand this. It will pass.” But I didn’t get that feeling in ’08, ’09. I heard fear. I heard like voices quivering when I was talking to them. And I remember sitting down with some people from a big Toronto investing firm in Ottawa-they happened to be there-and we were all just, like, shell-shocked. Like, we just could not believe what we were seeing. We were sitting there having a coffee in a food court, and it was just, like, everybody was, like, at a loss for words. And I remember being told as a journalist covering personal finance that some editor heard some rumblings about one of the big banks in Canada might be having a little trouble, and you better get on it, finding out what would happen. And so I went and had a briefing at CDIC-just hypothetical, we didn’t mention any bank names. But, here’s how things were happening. That was the level of fear and the level of uncertainty that was going on back then. And Canada came through it relatively, comparatively unscathed. And yet, there was still a lot of, like, pure, unadulterated fear. So that is Number 1.

Kevin Press:

And the thing about that fear was that it was, even at the very senior levels, right? I remember talking to senior vice-presidents, executives at all ranks, who were genuinely unsure what was going to happen next. I had one say to me, “It was like looking into an abyss.”

Rob Carrick:

Yeah. I had that feeling, too. And yet I had to be reassuring and the one saying to investors, “Don’t worry. This will pass. Don’t do anything rash.” And it did. You know, that was the reference test for, “Hang on, the markets always come back.” I mean, there the very capitalist system we live in was being questioned, you know, this whole idea, you know, of putting your trust in the investment industry and their wisdom. Like, the market dropped like 33%, like, in a very short period of time. Everybody was questioning that. But, that sort of gave me the foundation for preaching, “You know what? Whatever happens, stocks will come back. The capitalist system will right itself.” And I’ve been following that ever since then. You know what, when the pandemic happened, when the trade war happened, and other upsets, you know what? Let’s just go back to basics here. What do you own? Why did you buy it? And if everything still checks out, then stick with it. And that’s never been the wrong move.

Kevin Press:

Your work during that period was extraordinary.

Rob Carrick:

Oh, thanks.

Kevin Press:

And I’m curious if you were mindful of the idea of that being a teachable moment, right? That’s the thing about crises, particularly those that are as prolonged as the great financial crisis was, is that people pay attention differently.

Rob Carrick:

They do. And, it is definitely a teaching moment. Well, one thing I’ve learned is each teaching moment fades and you have to reteach. And I was really taught that in the trade war. I mean, I was blown away by the number of readers, notably seniors, who are basically capitulating. I was saying, “The market always comes back, long-term investors.” And they were going, “I don’t think I’ll live long enough. Literally, I don’t think I’ll live long enough.” Well, all you had to live was two months, and the markets came back. But, it just taught me that fear and emotion override, you know, tried-and-true lessons based on data.

Kevin Press:

One of the reasons that we’ve covered the trade war as much as we have is that I think it’s more difficult for advisors to have a conversation that includes both economics, financial matters, investment markets, but politics as well. That’s not something a lot of advisors are used to talking about, or perhaps even comfortable talking about.

Rob Carrick:

Yeah. I think it’s, that is extremely delicate file for advisors, the politics. Because, you know, one thing I’ve learned is that, you know, everybody’s got various views on investing, but we can come to some consensuses about what is sensible and good practice, but on politics, it’s a wild card. And advisors talking politics with their clients who may have different views than the advisor, I mean, if you look at LinkedIn and advisors professing their political thoughts, I can’t actually look at some advisors after reading their LinkedIn comments about politics. But, anyway, you don’t want to open a chasm between you, the advisor, and the client because you got into the political side of things. And yet you do have to understand that politics informs economics right now.

Kevin Press:

You were talking about the dot-com bubble and how your time as the columnist at The Globe and Mail began in the midst of that. Arguably, now, it’s an AI bubble, and so it’s kind of bookended your career in a really interesting way.

Rob Carrick:

It has, but the AI bubble is nothing compared to the dot-com bubble. The dot-com bubble was far more all-encompassing. Like, the mutual fund industry, which was ascendant then, like mutual funds were the way you invested, and there was just this explosion of technology funds and biotech funds, and everybody was getting into it. You could go to the bank and buy a biotech fund or a science and technology fund. It was just everywhere. It permeated into everything. Everybody was buying Nortel. Remember Nortel? That was sort of some people’s entry into tech. And AI, you know, its overall market impact is quite significant. I mean, it is basically driving, you know, one of the main reasons why the stock markets keep chugging higher. But I don’t think it’s sort of seeped into the portfolios and the investing mentality of sort of the bedrock foundational investors out there quite in the same way. I mean, they’re aware of it, but they aren’t making rapid-fire investing decisions based on AI. Some are, but I don’t think the masses are just now.

Kevin Press:

Do you think an AI bubble is possible?

Rob Carrick:

Oh, I think it’s probably happening, and it’s probably inevitable. Whenever you inject massive amounts of hype into a futuristic technology that we can semi-perceive, but we don’t know the long-term impacts, and we haven’t really seen how it’s going to be, turn profitable, it’s almost inevitable there’s going to be a bubble. And so if you tell me there’s a dot-com bubble, I’m not one to argue with you.

Kevin Press:

Yeah. I think the thing people miss with phenomenon like this is that it’s not a question of will this new technology have an impact on the economy, but it’s on what timetable? Right?

Rob Carrick:

Agreed.

Kevin Press:

And the markets move so quickly that, as we saw with dot-com, you can have the bubble burst, but the technology still ends up, in the long term, having the kind of transformative effect that the experts predicted.

Rob Carrick:

True, and I think AI is also, it’s the AI industry, the providers, the infrastructure, but there’s also its impact on all the other companies out there. How can they use AI to improve corporate profitability, to cut costs, to become more productive? And what impact will that have? So there’s the hype aspect, and then there’s the actual economic utility of it, and what will that do for stocks? Are some companies, you know, benefitting from that in a short sort of anticipatory sort of way. “This is really going to help my stock.” That sort of thing. I think it’s all baked in, and, you know, it’s going to overshoot. I almost think that’s inevitable.

Kevin Press:

Yeah. The other big thing that happened during your time at the Globe was the emergence of blogging and social media.

Rob Carrick:

Yeah.

Kevin Press:

Has that had a net positive or a negative effect on financial reporting, do you think?

Rob Carrick:

Positive. More channels means more people can find a communicator on this topic that they can understand, follow, and put to use. The competition has never bothered me. It’s actually been helpful. You know, I was doing the Carrick on Money newsletter for many, many years, and part of the mission of that was to put in all kinds of interesting content by other people, and I needed to have that content, and the bloggers out there, for a while, fulfilled that. Most of the good ones have faded away. More people are on social media now, and there’s some good voices out there. There’s a lot of junk, and there’s a lot of people just saying the obvious, the complete obvious. But, if some people find that voice saying the obvious is the one that resonates with me, I say, “It’s all good.” I do worry about, like, the garbage out there, just as regulators are worrying about it, and justifiably. You know, the people who are out there, you know, the predatory people, the people selling junk products, and junk services, and junk strategies, and that sort of thing. But, there are a lot of people out there who are almost hobbyists who are saying, “I got a TFSA. Did you know how great they are? Look what I’m getting.” And I’m thinking if one person opens a TFSA and starts investing in it because of that, then that’s all good.

Kevin Press:

Yeah, I think that there needs to be a tough discussion about the role of financial influencers, or finfluencers, and the way in which marketers are embracing them.

Rob Carrick:

Agreed. You know what? That was the thing about blogging way back when is, bloggers started their blogs, and they were voices, and they were sometimes quite intelligent people with lots of interesting things to say, and then they were sponsored by … And, you know, you look at a lot of the finfluencers now, and their topics are dictated by who their sponsors are. And I think people who consume this stuff should be aware of how much the content is being guided by the sponsorships and by the financial companies paying for it. And if it’s done forthright and 100% clear right up front, let the viewer make up their own mind. But, I have seen stuff, like, I’ve been reading, like, their posts and looked at videos, and I only twig like two-thirds of the way through, “Oh, wait a sec, such and such bank must have sponsored this.” And I go back, oh yeah, that’s the case.

Kevin Press:

Let’s talk about the state of financial advice. I’m so curious to hear what you think about how the industry’s doing these days.

Rob Carrick:

I think the industry is on a nice little upswing. It’s so improved from when I started my job. Like, there was just this mutual fund/advice/sales imperative when I started, and it was just basically sell as much mutual funds to as many investors as we can and never stop. And that’s all you have to do for financial success. And there were so many unhappy investors contacting me. When I started my job, I was really surprised at the number of emails I was getting from people complaining about their advisors, and I was sort of new to it, and I started to develop this, “Who are these advisors, or what’s happening here? This is almost like a very negative experience.” It helped generate my interest in DIY investing, and I had a healthy skepticism of the advice business. But, what happened was, I started to meet some very good advisors. I met the best people, instead of hearing from the clients of the worst people. And I started to realize, nope, there’s good people in there. And then, regulatory changes, which were never as strong as I had hoped they would be, but, still, were something. Also the industry’s had to professionalize. And it’s had to realize that investors don’t just want someone to move a bunch of investments around for them. They want someone to coach them. They want someone to do financial planning for them. They want someone to be their answer person. And, I think the advice industry is really embracing that idea, and it’s professionalized considerably since those days. Now, is it perfect? No. Is there more to do? Yes. I’d still love to see a fiduciary standard, like, for all advisors to work under. I was at an industry conference years and years ago where a lawyer, a Bay Street lawyer for one of the big banks, got up and trashed the fiduciary standard at an industry conference. And a few advisors were looking at me, and I was looking at them, and we were thinking, “Can you believe this? This is the world we live in.” And that view sort of held sway, and if the fiduciary standard was shelved, I’d love to see that come back. But, I think advisors understand that, conceptually, they need to work towards that. And I do see it happening.

Kevin Press:

What do you think about CRM3 or total cost reporting? This seems to be the next big idea on the regulatory front. How’s that going to play out?

Rob Carrick:

You know, I think it’s helpful. I mean, I think that, like, you know, adding in the information that was not included in CRM2, which was a big deal. I remember CRM2. I wrote a lot about that, trying to make people aware that it was happening, and then to prime them to go look for the information. CRM3 will add onto that. It will give you a much better view. But, you know, I think that sort of stuff, it’s great to have it out there. Super important. Let me draw an analogy here. Fund Facts. ETF Facts. Fantastic documents. As a journalist, I used to do this annual ETF buyers’ guide and I was all over the ETF Facts documents. And I was thinking, “What a marvel it is to have these available, but I don’t know how many people are actually using them.” And I think the CRM disclosure is kind of similar to that. Great information. Important. Everybody should look at it. I don’t know what the pickup rate is. It’s definitely got to be out there. And I’m not critiquing the initiative. I’m just saying that we’ve got to figure out a way to make more eyeballs connect with that information. CRM2, 3, 4, 5, 6, whatever, let’s have some more work put into making this work lively, and accessible, and interesting, and vital, and connecting with people who own the investments.

Kevin Press:

You’re so right. It’s not just a question of financial literacy, is it? It’s genuine engagement. I mean, it seems the industry keeps trying to be more transparent, but there’s only so much of the population prepared to dig into the information.

Rob Carrick:

Right. How can we get, you know, advisory firms and brokers to push this information up? It’s great that it’s there, but you get an annual mailing, or maybe it’s an email, and maybe you never click on that stuff. I mean, I’m a financial guy, and I have seen emails saying, “Your CRM2 disclosure for 2024 is now available,” and I’m thinking, “Eh.” You know, it’s like if you put that on my login page, as part of an informational dashboard, I would be all over it. Everybody would be reading it, and people would be engaging with it in a whole different way. But I mean, so much regulatory effort goes into making sure stuff is disclosed, but I think how it’s disclosed [has] got to be the next frontier.

Kevin Press:

Did you ever think about working in the industry?

Rob Carrick:

Well, you know, I did, actually. I was working as a business reporter, and I was thinking, “I’m coming to the end of this. It’s fun, but it doesn’t really wow me for a whole, you know, decades-long career.” And that’s why I took the Canadian securities course. I thought, “Maybe I’ll just go work in the industry,” and instead, I said sort of got a promotion there to Parliament Hill, and my career took off in a whole different direction, but I had that door opened.

Kevin Press:

If you could be a bank CEO for a day, what would you do?

Rob Carrick:

Oh, I would call up people and say, I would just make it an explanation day. “Why are we doing all these things? Like, what’s the long game here? You know, how long can we pretend our customers are dummies who don’t care how much they pay for stuff?” And I would like to hear the corporate culture speak to that stuff to explain why they do business the way they do business. And, you know, they’ve got to be true believers there. I want to hear it. I want to hear the internal story about why it’s that way.

Kevin Press:

Talk to me about your interactions with industry people because you have been a focal point for so many years, one of those key influential voices in the country. You must have come in contact with such a huge number of industry professionals. What was that like?

Rob Carrick:

You know, it was, for the most part, was very good. You know, one thing I always tried to do was be a helpful critic and a balanced critic. I mean, I criticized long and hard, but I also said when people did good things, and I think that’s important. You know, if you’re a critic or a columnist, and you’re a very critical person, your credibility has no credibility unless you also can give people praise for when they do things right. And I remember once TD Bank invited me to some conference. They were doing an internal conference. They had a few people there, and they said, “We’re inviting you because you criticize us, but you also tell us when we’re doing something right.” And, I think I was able to have a dialogue with a lot of different execs there because of that. Some were a little nervous talking to a journalist. Some were, you know, very much in sales mode or proselytizing mode. But I had a lot of dialogues with a lot of good people. And, you know, I got a lot of great columns out of that stuff. I will say that access to executives for me and for other journalists has really declined in recent years. Like, I used to write a lot about mortgages, and I had like the phone number, direct lines, for a lot of mortgage vice-presidents at big banks. And then that ended, and you’re not talking to that person ever again. And then, it was basically, it’s come down to you won’t even talk to humans. You have to submit your questions by email, and we will give you written answers to them. Like, so access to executives has been pared back to that now in many cases. It’s the same thing in politics. Talking to live humans has been reduced. But, you know, I met them at conferences. You know, I’d have the odd phone conversation with them. You know, their media people would set up meetings for when they came to Ottawa. And I feel like there was sort of a mutual respect thing going on.

Kevin Press:

It is fascinating, isn’t it, how the communications profession has evolved over this period of time, right? You’ve seen it really turn into a kind of risk management role.

Rob Carrick:

You are 100% correct about that. I think there’s so much more work that could be done to improve that. You know what? The whole, “We’ve done a poll. Here are the results. Would you like to interview our person about that?” It’s so dreary. Journalists, just, their eyes roll every time these things come in. And I do see they get hits on it now and then, but I was thinking that landed in the hands of some know-nothing beginner who had to write a story on something and, you know, just did that. There’s good stories to tell, and there’s bad stories to tell, and media and communications people have to operate in both worlds. But I think there’s ways of building trust with media that have gone by the wayside.

Kevin Press:

Shift gears a little bit. One of the really fascinating things happening in our business is the changing nature of retirement. And you’ve become a case in point. It seems to me that the transition that you’ve made sets you up to work well past age 65. Is that the plan?

Rob Carrick:

That is the plan. You know, journalists are very fortunate because we have skill sets that are in demand in the business world, and in government, and that sort of thing. And, you know, whether we’re writing speeches, or writing reports, or doing technical writing, or media strategy, or that sort of thing, providing expert commentary, there’s a lot of room for it. And I had a nice niche. I mean, personal finance is the universal topic. Someone who tells me, “Oh, I have no interest in that”- sorry, you do. I’ll find it, and it’s there. And so personal finance is great. It’s like the nexus of everything in business, and economics, and government. And I have had the best time writing about it.

Kevin Press:

Do you have a retirement plan?

Rob Carrick:

I do. I have a financial planner and been meeting with him for years. And I basically said, “My wife and I have had this ongoing dialogue: ‘Are we ready? Can we do it?'” And he said, “Yes, you can.” And then, I actually worked for an extra year on top of that. And it was always factored in that I would keep working. My wife is working full-time. She’s a consultant, and she’s going till the end of this year. Then, she’s going to basically pivot to what I’m doing, and we’re both going to be, you know, working on projects that we want to work on, and when we want to work, and that sort of thing. And I foresee doing this, I’m going to just say another five years at least.

Kevin Press:

That’s wonderful. I mean, I think the thing that people underappreciate is the longevity risk, right? Longevity risk. It is just really difficult to calculate.

Rob Carrick:

Let me give you longevity risk in the real world. My mom, 97. My in-laws 80, 85 and 81, all with various, you know, care needs, and all that sort of stuff. And I’m getting an education, like right front-row seat, and it’s definitely, definitely resonating with me. You know, I had a reader send me an email after I retired. He was giving some advice, as retirees like to do to people who are just entering that phase. And he was saying, “Health is the Number 1 wealth.” And I was thinking, “You are so right, buddy.” And I’ve got to work that into something I’m writing because that is almost the dominant theme I’m thinking of for my retirement, looking ahead.

Kevin Press:

Last question, Rob. Piece of advice for financial advisors. What do you have to say?

Rob Carrick:

You know what? Treat your clients like people, not clients. Talk to them about how their lives are going. Make friends with them. Find out what their worries are about money. Address them. Don’t make it all about the investments. That’s yesterday’s advice business, and it’s going away. You have to be much more than that. You have to be their financial copilot, their wingman, their friend, their support person, all that stuff. I mean, they have worries. I mean, financial anxiety is rampant. And what are you doing to help your clients surmount that and, beyond, making sure that you have good investment returns?

Kevin Press:

Thank you, Rob.

Rob Carrick:

Thanks, Kevin.

Kevin Press:

My guest has been Rob Carrick, personal finance journalist, keynote speaker, and consultant. Visit RobCarrick.ca for more. Canadian Advisor.cast is a production of Newcom Media Inc. It’s produced by Alisha Hiyate. Noushin Ziafati is our associate producer. My name is Kevin Press. Thanks for being with us.