Heather Reisman is the founder, Chair and CEO of Indigo Inc., Canada’s largest book, lifestyle and specialty kids’ retailer and the host of the podcast, Well Said. She is also the co-founder of Kobo, a leading global eReading company.
She was born in Montreal and educated at McGill University. For the first 16 years of her career, Ms. Reisman was Managing Director of Paradigm Consulting, the strategy and change management firm she co-founded in 1979. Paradigm was the world's first strategic change consultancy and pioneered many organizational change strategies still in use today.

Ms. Reisman is a former Governor of McGill University and of the Toronto Stock Exchange. She has served on many North American boards and continues to serve as a Director of Onex Corporation, Sinai Health and The National Library of Israel.
Ms. Reisman has co-executive-produced a number of important documentary films, including Emmy and BAFTA winning, The Social Dilemma, and Fed Up. The Social Dilemma explores the dangerous human impact of social networking, and has found resonance around the world having now been seen by over 100 million people. In 2021, Ms. Reisman co-authored Imagine It! A Handbook for a Happier Planet.
Ms. Reisman is an Officer of the Order of Canada and the recipient of eight Honorary Doctorates including from University of Toronto, McGill University, and The Weizmann Institute of Science. She has been included in the Top 100 Most Powerful Women in Canada; the Financial Times of London list of Top 50 Women in World Business; Waterloo Entrepreneur Hall of Fame, University of Waterloo; International Distinguished Entrepreneur Award, University of Manitoba; and the John Molson School of Business Award of Distinction, Concordia University. She also received the Desautels Management Achievement Award in recognition of her outstanding contribution to Canadian business and society.
In May 2015, Ms. Reisman was inducted into the Canadian Business Hall of Fame.
Ms. Reisman is married to Gerald Schwartz, Chair and CEO of Onex Corporation. She has four children and 11 grandchildren.

Identifying investment goals is a critical step in developing a sound financial plan that helps investors reach their objectives. Studies have shown that using a goals-based framework in financial planning can lead to an increase in wealth for investors and has the potential to strengthen planner-client relationships; but what goals should you be setting? And why is it often so difficult to make these kinds of decisions? In today’s episode, Benjamin dives into some of the research he is conducting about goals-based financial planning for the paper he is writing on the topic, and we discuss why defining and prioritizing goals in the financial planning process is so important (and why it can be so challenging), as well as some practical guidelines to help you set effective goals. Additionally, you’ll learn all about our 22 in 22 Reading Challenge, which we officially launch today with the help of Heather Reisman, book lover, entrepreneur, and CEO of Indigo, Canada’s largest books, gift, and toy retailer. Heather is also the co-creator of the Kobo reading device, a former governor of the Toronto Stock Exchange, and the co-executive producer of the documentary, Fed Up. As you know, the objective of this podcast is to help improve listener’s lives by communicating ideas about sensible investing and financial decision making; and reading is a big part of that. Make sure to tune in to find out where to sign up for the challenge, take note of our book recommendations, and more!

Key Points From This Episode:

• Learn more about the 22 in 22 Reading Challenge and where to sign up for it. [0:00:35]

• Introducing today’s special guest, Indigo CEO, Heather Reisman. [0:03:55]

• Some of the exciting guests you can expect to hear from on the show in future. [0:06:38]

• Our watchlist recommendations for you, including Ray Donovan: The Movie. [0:08:43]

• Cameron’s book recommendation: The Culture Code by Daniel Coyle. [0:10:05]

• Benjamin shares his views on Facebook's one-day $232 billion drop in value. [0:17:16]

• Why a great company is not necessarily a great investment. [0:22:32]

• Reflecting on the Talking Cents cards we did with Andrew Hallam in Episode 186. [0:23:45]

• Onto today’s main topics: how to make sound, goals-based financial decisions. [0:27:20]

• Why defining and prioritizing goals in the financial planning process is important. [0:30:33]

• Find out what goals you should set and why it’s difficult to make those decisions. [0:31:19]

• Practical guidelines to help you set goals from Bond, Carlson, and Keeney in 2010. [0:33:47]

• Hear some of the goals from the master list that Morningstar put together. [0:36:15]

• Learn what an effective goal looks like according to Ayelet Fishbach. [0:37:21]

• Whether you should use approach goals or avoidance goals. [0:39:42]

• How you can turn your goals into action by creating challenging, measurable, actionable, and self-set targets that don’t feel like chores. [0:42:51]

• Creating more intrinsic motivation when setting long-term financial planning goals. [0:45:58]

• Why pursuing goals is more about the journey than it is about actually achieving it. [0:47:08]

• How top level abstract goals are served by multifinal, equifinal, and unifinal means. [0:48:48]

• Resolving goal conflicts by prioritizing some goals over others or compromising. [0:50:11]

• Kicking off the 22 in 22 Reading Challenge with special guest, Heather Reisman. [0:53:12]

• Why Heather believes reading is so important, starting with the pure joy it brings. [0:53:44]

• How she decides what to read, whether it’s via recommendations or based on her specific interests at the time. [0:55:59]

• What her daily reading habits look like that enable her to read 75 books a year. [0:53:30]

• How reading helps with some mental health issues that stem from social media. [1:01:25]

• Why she advocates for long-form reading, regardless of whether or not it’s digital. [1:03:38]

• Learn about the origins and the mission of the Indigo Love of Reading Foundation. [1:05:50]

• How a community like 22 in 22 might help someone who wants to read more. [1:10:25]

• Heather’s parting words of advice for listeners: be deliberate about your habits! [1:12:37]

Read the Transcript:

Ben Felix: This is the Rational Reminder Podcast, a weekly reality check on sensible investing and financial decision-making from two Canadians. We are hosted by me, Benjamin Felix and Cameron Passmore, portfolio managers at PWL Capital.

Cameron Passmore: Welcome to Episode 187, and the launch date for the Rational Reminder 22 in 22 Reading Challenge is finally here. Today's the day, Ben, that we go live.

Ben Felix: It's very exciting.

Cameron Passmore: It is exciting. As people know, the objective of this podcast is to help improve listeners' lives by communicating ideas about sensible investing and financial decision-making. As you said, that's our domain. Clearly, reading is a big part of that. And we thought that since reading is often on people's New Year's resolutions, that we would help people accomplish the goal of reading more.

So we've created this community, it's a website that's now live. This is going to be an environment where you can set your own goals, and treat this as a commitment device to help you accomplish the goal of reading more. And there has been pretty incredible interest around this so far.

Ben Felix: That's why you did it, right? Didn't you just do a tweet or something? And then a bunch of people were interested in doing something about it?

Cameron Passmore: Tweet and LinkedIn. I've been talking about it for a few weeks. I've heard from a lot of friends and people that I know online, that they're really looking forward to this. We also set up a 22 in 22 recommended book list on the Rational Reminder website. Anyway, so to get set up, we signed with a company called Beanstack. So if you go to pwlcapital.beanstack.com, there's also an app for Beanstack, which I put on my iPhone, it loads up very easily. Then you have to find a site and just type in PWL, and you'll see the community there.

You can join in. Super easy to join, very easy to log books that you have read. You can log minutes that you're reading, if you wish. You can put in reviews. It's not like our community where it's open for everyone to see. This is an app that's been built for mainly schools. So for privacy reasons, you have to connect with other friends. If you want to connect with me, and I'll put this online and it will be in the show notes. My Friend Code is N62IPTX. Ben, yours is 7XWESMK. Again, we'll put them in the community, they will be online. If you want to connect, drop us a note. I think, Angelica is going to set up a thread in the community board where people can share their codes, if you want to connect with others in the community.

Ben Felix: What happens if someone becomes your friend in this software?

Cameron Passmore: You get to see what they're reading.

Ben Felix: So everyone should sign up and become your friends, so they can see what you're reading?

Cameron Passmore: Correct. I just like to be connected to other people. There's no place in there for chat just yet. I think, Angelica is developing a relationship with Beanstack, because I'm not sure there's a lot of corporate users of this. So I can see some improvements hopefully coming. It's a nice, simple, effective app. And it's also really cool that Angelica has put in rewards. So as you reach certain levels, you're going to get badges, you're going to get discount coupons in the merchandise store. And I think, she has some surprises along the way too.

Ben Felix: Oh, that's cool.

Cameron Passmore: And then there's also the newsletter. So if you signed up already on our community board, there's a newsletter that will come out every quarter. So we'll see how that that rolls out. If again, you're looking for inspiration for books, check out the 22 in 22 book list on the Rational Reminder website.

As we've been saying for a few weeks now, we wanted to invite special guests to help inspire people to read more. And I think we have a great guest. I know we have a great guest today joining us to launch this whole initiative, and it is Heather Riesman joined us. And if you've been to an Indigo Store, you've certainly heard of Heather's picks. Well, today we speak with that Heather. So Heather is the Founder and CEO of Indigo Books and Music, which is Canada's largest book gift, especially toy retailer. She's also the Co-Creator of the Kobo reading device. Heather was appointed to the Order of Canada in 2019, and has also been inducted into the Canadian Business Hall of Fame. And she is, interestingly enough, a past governor of the Toronto Stock Exchange, as well as McGill University.

And you asked you this question in our conversation, she co-executive produced a couple of documentaries, including the Emmy Award Winner, The Social Dilemma, as well as Fed Up. She co-authored the book, Imagine It: A Handbook for a Happier Planet. We got lucky to meet Heather. She is a friend of a friend of mine, who my friend's an avid listener and reader, so he was kind enough to make the introduction, and for that we're very grateful. Anything, Ben, to add to the reading challenge?

Ben Felix: No. I think, it's a great idea. I used to always make comments about how you read so much, and I don't know how you do it, but I've realized that I read a lot of books too. I just do it differently than you do. I usually skip around. Well, one of the other people that we had a conversation with that'll come out in the future about the reading challenge, he highlighted this for me, that there's not just one way to read a book. Anyway, so I have a lot of books that I reference frequently when I'm thinking about other stuff, or researching. I just don't sit down and read them beginning to end, like you often do, and then write notes about it.

That's what I always find so impressive about the way that you read is you take a book, you read it, you write your notes about it, and then you talk about it. It always makes me feel like... I don't do that, but I do consume a lot of books, just differently. I'm looking forward to sharing that in this community as well.

Cameron Passmore: So we had a couple of really nice reviews lately. Maddie left a review saying, “It's an amazing podcast. It's a must listen for anyone who's looking to further their financial education and elevate their investing strategies.” She goes on kindly to say that we break down topics with fresh insight and perspectives, as well as practical advice. So thank you for that. Jonah said, “This is the best investment podcast out there. I wish they took listener questions.” We try to take some listener questions.

Ben Felix: We do take them. We take them and lots of our content is informed by the discussions in the Rational Reminder Community, which is an implicit listener question. But we're happy to take explicit listener questions as well.

Cameron Passmore: Upcoming guest next week, we have Ayelet Fishbach. She's the author of Get It Done: Surprising Lessons from the Science of Motivation. And also, her book is on our 22 suggested book list. Phenomenal interview, she was just terrific. Two weeks after that, we'll welcome Leonard Mlodinow, who is a longtime friend of ours actually, and author of the recently released book Emotional: How Feelings Shape Our Thinking. And then in five weeks' time, London Business School's Finance Professor, Alex Edmans, will join us. He is the author of the book, Grow the Pie: How Great Companies Deliver Both Purpose and Profit, which was chosen by the Financial Times as one of the best books of 2020.

I thought we'd also give a heads up on some of the guests coming up that will join us in the Us episodes. These will be short interviews, like the one we had today with Heather. So coming up in two weeks' time is Neil Pasricha, who is the author of the awesome series of books, which I'm sure many listeners have read. He's also the host of the podcast, 3 Books. And then two weeks after that, Morgan Housel is going to come back and join us. So he's a past guest and author of the massive bestseller, The Psychology of Money. And that book seems to show up on everyone's recommended list.

Then a couple weeks after that, our very good friend and frequent guest, Larry Swedroe, is going to join us. And I thought he'd be interesting to talk about this, because he's both a prolific reader and he has summaries he puts out in all the books he reads and he ranks and every year, but he's also a prolific author. So I think that's a good combination.

As always, connect with us on Twitter, #rationalreminder and CP313 on Peloton. I'm on LinkedIn, if you want to connect with me. Ben, you're on there, but you're not active on there, but your profile is active.

Ben Felix: Angelica told me not to talk about that.

Cameron Passmore: Okay. We won't talk about it.

Ben Felix: She said that I should act like I'm engaging with people. We'll see if she cuts this out. She said she wished she'd cut it out last time, now, I'm curious to see if she's going to censor me. Am I going to be censored? I don't control my LinkedIn account.

Cameron Passmore: And here's a recommendation for you. Anyone who liked the series, Ray Donovan, I found out about this on the weekend, there's a Ray Donovan movie that just came out. It's on Crave. I didn't know how they could keep the story going after the series, but they sure did. Wow! What a movie! Fantastic.

Ben Felix: Never heard of it. I've got one. Tell you what? I've been watching in the evenings.

Cameron Passmore: Watch in the background, while you're working your laptop?

Ben Felix: Nope. Actually watching. You're going to laugh though. Gary Gensler, who's currently leading the SEC, he taught a course on cryptocurrencies at MIT prior to being at the SEC. He's a very impressive guy. I mean, he talks a little bit about his personal background and professional background in the early lectures. They're quite good. I've been watching those. It's free MIT OpenCourseWare.

Cameron Passmore: Really?

Ben Felix: It's video lectures, but it's also got the slides, the readings, everything. It's all on the MIT website. That's been how I've been spending my evenings.

Cameron Passmore: Very cool. That's interesting. Okay, is that good for the intro?

Ben Felix: Good.

Cameron Passmore: All right, let's go with episode 187.

Ben Felix: Welcome to Episode 187 of the Rational Reminder Podcast.

Cameron Passmore: Okay. Shockingly, we'll kick this off with a quick book review.

Ben Felix: Shockingly.

Cameron Passmore: Shockingly. These are great books, and today man, today was really good. This is a book I absolutely loved. People know that I've been a little obsessed with learning about how organizations and teams work. And you can see that in the recent book reviews. So today's book is called The Culture Code by Daniel Coyle. And yes, this book is on the 22 in 22 list. Simply a phenomenal book. I loved it because it tried to answer a simple question, which is, why do some organizations become greater than the sum of their parts?

So the point of this book as I understood it is, the success of your company rests not on the intellect, or the experience of your team, but rather in the ability for the team to work together as a single unit. Sounds simple enough, but he put together this incredible framework. As you said in the beginning, I've been able to extract this framework, boil it down and put it into my collection of notes. I've been collecting these notes for years about all kinds of different topics, and I loved the way he broke down so many things.

I want to take you through some of the key takeaways from this book, as I understood it. So his point is that successful group culture... So if your team is going to come together as a unit, you need to have a great culture, so the culture code. So the successful group culture is built on three critical things; safety, vulnerability, and purpose. That is the big takeaway.

So safety is what he calls a cornerstone of interconnectivity. So he says, you have to have honest and open communication, people have to be able to feel that they can speak out, regardless of the hierarchy of your organization. People need to feel valued, that they belong, and that they're comfortable in the group.

This triggers effective open communication. This creates chemistry. And this chemistry causes people to be so engaged, that they go above and beyond their expectations.

This is not to say that you're working people to death, it just means you get a different level of engagement, that they end up being better driven at those moments of the day to be more connected and deliver better work and more fulfilling work for them. It also means that people will stick together in the most volatile of time. So he says, as a leader, to create safety, you should listen actively with full attention to the immediate conversations and watch for your attention waning somewhere else. Deliver lots of small courtesies. Always exaggerate your appreciation. Give cues to your teammate's future and discuss long-term goals. Encourage speaking up. Promote a very vocal workforce. Have lots of interactions. And in group discussions, really invest in the exchange, and orient the exchange of ideas towards the future.

Number two, vulnerability. This is what the author calls the foundation of teamwork. So this is the exposure that demonstrates your own personal weakness to your team followed by a request for help. This develops trust. So this leads to open and honest communication and build a better, stronger team and creates better solutions. So you have to make sure your team feels secure enough to be able to be vulnerable in that environment. So ask questions, gently challenge. Don't just simply give teammates the answer. Let them work and figure out the answers. He also says, be candid with feedback, but not brutal.

Third piece, the third part of the foundation is purpose. And this is what the author calls the core of decision-making. So the purpose is the essential message that guides the direction of the company. Why do we do what we do? What is our mission? So you always have to give your team and your teammates clear perspective on the role of their work. Always give clear priorities. Help discover obstacles on the path towards the goal.

And there's so many benefits to this. And again, it goes back to what I said earlier. When team members understand their role and the overall purpose, they'll put more energy into creating solutions, and they're more fulfilled. It's that creating this energy at times of the day when it's the right thing needed at the right time, so people aren't just on autopilot. Autopilot doesn't go very far.

This creates an energy through the day. People end up learning faster, because they're more engaged. They'll take what they learn and apply it to solutions quicker and be more fulfilled.

Also, he says if the purpose is not clear, then there's no standard for people to live up to. There's no reason to perform if there's no clear purpose. People may misconstrue the reasons for certain decisions, or reasons. Lack of clarity equals confusion. Confusion equals frustration and anger. Clearly, that's not the environment you want. Those are the three main foundation pieces.

My last two takeaways, and this applies to work that you and I do. He talks about the difference of team environments in two main different types of work environments. So if you're in a high-proficiency environment, which is what he calls it. For example, our world, delivering a technical service, delivering a financial planning investments, that's a high-proficiency world.

Basically, failure is not an option, so you have to create an environment where team members can make quick and appropriate decisions, while working as a singular unit. You're reliant on other people to deliver high-quality, technical, deliberate, accurate advice, and repetition and feedback are crucial to make sure you get in that expertise, much like you're a surgeon, right? There's no creative work in being a surgeon necessarily. Right? So you want to continue to explain that person's role and the overall purpose of that deliberate service delivery unit.

The other type of environment is a high-creative environment, such as creating a new service, a new product, or even take this book challenge. This book challenge that we're doing is an experiment. If that goes great, great. If it doesn't go great, well, it's not a life or death type thing. In a high-creative environment, you want to create a team culture where failure is necessary, and that helps to develop a high level of creativity. You want to create a space where people can discover their work for themselves, even if the author says, 90% of the ideas fail, the other 10% can lead to incredible advancements.

You have to make sure that people have autonomy, try things, fail often, learn from failures, and own the process. So embrace failure and learn from it. Those are my key takeaways from a phenomenal book. Anyone that's managing a team, or is in a team type environment, I highly recommend this book.

Ben Felix: All make sense.

Cameron Passmore: It's interesting, when you read a lot of these types of books, they all weave together. I just thought this author did a great job of framing it in a way that you can remember those three parts of foundation, these two types of team environments. So keep those notes front and center. And I think they can really help people.

Ben Felix: It definitely sounds like a real articulation, or maybe this was the original, I don't know the timeline. It definitely sounds like other similar books on managing teams that you've talked about.

Cameron Passmore: Like Daniel Pink's Mastery, Autonomy Purpose. There's similar themes. Anyways, you had a news, an updates story you wanted to share.

Ben Felix: You put that in there. I just put the notes in to talk about it, because I thought it was worthwhile, but you've selected this story. Facebook's price drop, wiped out 232 billion dollars of value in one day, which set a record for stock market history.

Cameron Passmore: Doesn't that blow your mind? In a day!

Ben Felix: It's a lot of value.

Cameron Passmore: It's a lot.

Ben Felix: But that's what I want to talk about. When you put that in there, because everyone's like, “Whoa, this is crazy. It's a record.” But it's not really unexpected. He have these massive companies. Companies are getting more valuable than they'd been in the past, which you would expect just by adjusting for inflation, that's crazy. We talked years ago now in old episodes about how the level of concentration in the stock market is not that unprecedented. It always goes like that anyway. So these companies are big, but they're growth stocks. They got high prices. What happens to growth stocks?

I just took my notes from the old episodes, the one about Where the Stock Returns Come From, I think it was called, but I thought it was worth reiterating those. This is from a Fama and French paper. But growth stocks tend to have negative convergence in their price relative to their book value. Thei price to book falls, because growth companies don't always remain highly profitable with low expected returns, low discount rates. Why is a growth company a growth company? Well, because it is profitable, and it's got a business that the market has deemed to be relatively safe and stable, therefore it has a low discount rate. So that gives it a very high price when you combine those two things together.

But on average, the price to book declines after stocks move to the growth category, and the positive average rates of capital gain of growth portfolios, traces back to increases in book equity, that more than offset the declines in price to book. They actually decrease in their valuation, but they also grow their book equity after being added to the growth portfolio. So these companies are... They're seeing their fundamentals grow, but their relative prices aren't rising. And in fact they're falling after being added to the growth portfolio.

So Fama and French in the paper that we're referencing here, they offer the explanation that companies that are allocated to the value versus growth portfolios tend to be the opposite ends of the profitability spectrum. Growth companies tend to be highly profitable and fast-growing, and value companies are less profitable and growing less rapidly. Then that's what gives the differences in relative price. That's all pretty intuitive, I think.

The thing that happens is that that's not going to stay true forever. Competition from other companies for the growth stocks, or just exhausting the most profitable growth avenues tends to eventually erode the high-profitability growth of growth companies. So over time, some growth companies stopped being as highly profitable. They stop growing their profits as quickly, and their low cost of capital tend to increase. That results in them either dropping out of the growth portfolio, or just having the relative price decrease.

And for value, it tends to be the opposite. Relative prices tend to increase after value companies get added to the value portfolio, because some value companies restructure their business and improve their profitability and decrease their cost of capital. So this idea of basically mean reversion in relative prices is called convergence. That's what Fama and French called it, which is basically predictable changes in profitability and growth and related changes in expected returns that occur because growth stocks are not growth stocks forever, and value stocks are not value stocks forever.

What did we see with Facebook? Well, their profitability forecast, their revenue forecast dropped, and their cost of capital probably went up. Well, it definitely went up. Price dropped. But that's something that happens to growth stocks. It's funny, like what was it? Two years ago, maybe, or a year ago that the media was getting so excited about these huge docks with the Fang stocks and their returns are so good, and the prices kept going up. We kept trying to give the rational perspective. This doesn't happen forever. It's always, "Well, this time is different." Well, it was until it wasn't, which is the way it always is.

Cameron Passmore: For it to be different, it means that the investors have to keep pricing it to expect that high return going forward. It doesn't make sense.

Ben Felix: Yeah. Revenues can continue growing, or profits can continue growing, to the point where the company becomes bigger than the whole global economy, but that doesn't make sense. So that avenue doesn't work. And then the other avenue is that the relative price can continue increasing forever. But again, that doesn't work. At some point, people won't pay that much for expected growth, and eventually things turn around as the data show.

Cameron Passmore: But the disconnect that I think so many people make is, yes, you have the company doing what the company will do in terms of profitability. But over here, you also have competition on what people are willing to pay for that stock. So that mechanism is pricing what a company is doing. So you can't just say, “Well, it's a great company, therefore I want to own it.” Well, no, it's what are you paying for that future growth? How is the market pricing it?

Ben Felix: Yeah. Well, it's like what we talked about, I don't know when, was a few episodes ago, about how a great company is not necessarily a great investment. It depends what you pay for the expected cash flows. Anyway, I thought this was interesting, just because I remember covering, like we did CSI videos on this. We covered it on the podcast about how well it looks as if these stocks are going to continue growing at the crazy rate that they've been growing forever. That's not how it works. There's historical precedent for massive companies that are in winner-take-all situations in their industry. And they end up being enormous in absolute terms and relative to other stocks in the market. And it doesn't last forever.

In fact, those largest stocks tend to have market trailing returns after they have become the largest stocks. So there's two things going on there working against these companies. There's the size, which is negatively related to expected returns, but there's also the relative price. And those mega cap, high-price stocks have low expected returns. The good news is that Facebook has a higher expected returns now. That's good. That's exciting.

I wanted to say a couple things about the Talking Sense cards that we had with Andrew Hallam. Lots of good feedback on that episode, by the way, on YouTube, and also on the Rational Reminder community. That was nice to see. Andrew's very enjoyable to talk to. One of the Talking Sense cards was asking whether sports teams should be owned by individuals, or by the city's players and fans. And I didn't know what to say. I said, it sounded like communism, and that it probably wouldn't work very well.

That wasn't a very smart thing to say. People in the community pointed out that there are sports teams, in fact, that are owned by their fans. It's not exactly the way that the Talking Sense card asked the question, but it's still interesting, so I wanted to mention it. So FC Barcelona, which is a soccer team, I think with the highest revenue in the world, and the Green Bay Packers. These are just two big examples, there are other examples. The Green Bay Packers, an NFL team, they're both structured as not-for-profit organizations, where the fans can become members and own the team.

Now, what does ownership mean? That's a different question that I'll touch on in a second. It's also interesting to note that this structure, the not-for-profit ownership structure is not allowed in either of the leagues that these teams competed anymore. They're both grandfathered in, because that's how they were owned, I guess, going back very far.

For FC Barcelona, I just poked around at the structure when I saw somebody comment about this in the community, because I'd never thought about it. The members legally own the organization, but it's not for profit, so there's no cash flows. They don't own future cash flows, like you would in a stock. They don't have any control or input, except for electing a president for the organization every four years. Then once the president is elected, they basically have full discretion over the operations of the team.

It's not clear what exactly the members own, other than maybe the feeling of ownership, and the vote, of course, which is worth something. Then Tom talks... It was Diego that wrote about FC Barcelona and their teams in the community. Tom talks in the Rational Reminder community pointed out that in the NFL, they equally share revenues across all the teams. His point is that the Packers being able to have this common ownership structure, the not-for-profit ownership structure may not tell us that that results in a successful team, or can be viable for a successful team, because in the case of the NFL, most other teams are owned by individuals, or small groups of owners. Because the profit is shared equally, the Packers don't have to do anything. They don't have to be a great business, because they're getting an equal share of revenue. It could be the much more capitalist structure of the other teams that's making the league successful, which is therefore, taking that team with it.

Anyway, that card totally threw me off. It was interesting to see the feedback that we got about it. It was successful in getting me to think about something new, which I think is one of the points of those cards.

Cameron Passmore: Great follow up.

Ben Felix: Ready for the main topic?

Cameron Passmore: You've done a little bit of work on this one. This could be one of my favorite pieces of research you've ever done.

Ben Felix: Really?

Cameron Passmore: I think, this stuff is so cool.

Ben Felix: Wow, you don't need to say that. It's a big deal.

Cameron Passmore: It links back to so much of, I think, the evolution of our learning over the past three, four years. You pull it all together really nicely here.

Ben Felix: Well, it happened last week. I've been working on this paper. This section was not previously in the paper. I've been working on this paper on, I don't really know what to call it yet, but it's how to make a financial decision, basically. All of the non-financial considerations of making a financial decision. If you're a robot, you might invest your money and not spend it. Save a 100% of your income, except for what is required for basic necessities and invest in the riskiest portfolio possible to maximize wealth. Maybe that's what a robot would do, depending on its utility function, I guess.

For people, that's not typically the right thing to do. What are the inputs to a financial decision that people should think about? That's the paper that I've been working on. Then, we talked to Ayelet Fischbach last week, and her whole thing is motivation science and pursuing goals. After talking to her, I realized that tying the whole paper together is that. It's setting goals. How do you actually put this stuff into action? You have to figure out what your goals are.

In reading Ayelet's book to prepare to speak with her, there's this thing in motivation science that we'll touch on in the segment called a goal system. I don't know if it's the engineer in me or what, but it's a picture of goals. Each goal has means, or sub goals attached to it, and drawing it out, and there's some other language that goes along with that, too, that I'll touch on in a minute. Drawing it out, lets you figure out which means, which is basically the activities, like which stuff that you do in a given day should you do to maximize the attainment of all of your goals?

Oh, wow. That's like an optimization problem. That's cool. Anyway, got me interested in goals. I started looking into it, and wrote a whole section for the paper and thought we would talk about it. My other idea was to do emerging markets. Should you overweight emerging markets relative to market caps? We'll still cover that eventually. I know people would be interested in that, but I just spent a bunch of time working on this, so this is what we got.

Goals-based financial planning. It's a big deal. That's how financial products are sold. It's also how fee-based financial advisors operate typically, where it's like, okay, what are your goals? That's the question that a financial planner will often ask. FP Canada Standards Council, which is the Financial Planning Association in Canada, and they've got a Standards Council. They explain an effective financial planning recommendation properly implemented will help the client meet their financial goals and needs while helping to optimize their financial position. Great. That makes a lot of sense.

Big financial goals. If you think about financial planning case studies, for example, when you're doing the CFP, you have case studies. What are financial planners thinking about? It's often stuff like retiring. I want to retire at age 55 with $8,000 per month in income. I want to buy a bigger house. I want to pay for my kids' university education, or I want to buy a boat, or a cottage, or whatever. Those are common financial goals that people will come up with.

Defining goals is important. Prioritizing goals in the planning process is also important. There's an interesting paper that David Blanchett had in 2015, where he showed using a utility model, and some Monte Carlo type analysis. I think, he found a benefit equivalent to a 1.6% alpha by properly funding goals, like finding the right goals in the right order at the right time. There's a real benefit to setting goals and approaching them strategically. That's a math problem. What David Blanchett did in his paper is it's a math problem.

The part that I was stuck on, and I realized, speaking with Ayelet and reading her book that this is what the paper I'm working on is about, is what goals should you set? I think, that's really hard. It is really hard. There's research showing that it's really hard, that I'll talk about in a second. People aren't good at knowing what will make them happy in the future. We've talked about that many times in the podcast, and there's a whole bunch of that type of information in the paper that I'm working on. What I learned more recently is that they're also deficient at generating the possible set of objectives for the decisions that they make.

If you sit somebody down, even if they do know about all the happiness literature, and what are the contents of a good life? Even if they do know that information, and most people don't. Even if they do, if you sit them down and ask them, what are your objectives? What are your goals? They won't give you, on average, a comprehensive list. The way that that's been studied is if you ask somebody what their objectives are, and then later show them a master list of objectives that aggregated from other people, for example, then people will, after the fact, identify a whole bunch of those objectives as important, or more important than the objectives that they independently identified, which is crazy. This is a paper by Bond, Carlson and Keeney, 2008 paper, where they found that.

Then, they followed up in a 2010 paper. They said, that the shortcoming in identifying objectives, it seems to come from not thinking broadly enough about the range of relevant objectives, and then not thinking deeply enough to articulate every objective within the range that was considered. They ran some experiments and found that that was the source of the issue. The point is, starting with a question, whether with a financial planner, or on your own, what are your goals? Or even sitting down and writing out, what are your goals? It's deficient in a lot of different ways.

How do you identify objectives? This is assuming that you are familiar with the literature on the contents of a good life, which is a whole other... That's a whole other thing to cover in a future episode, or recover, because we've covered it before, but there's a whole bunch of stuff that we didn't cover then that is in this paper that I'm working on. Anyway, setting financial goals is pretty much the process of defining a good life for yourself, when you think about it. Money is just a tool. Time is just a tool. To set goals, you have to decide, what do I want my life... That's what goals are. We know people are going to struggle to set those goals.

Following the prescriptive implications from the Bond, Carlson and Keeney 2010 paper that I mentioned, they say that you should sit down, generate your list of objectives without outside help. Step one. Now you know that that initial list is going to be deficient on average. So the next step is to revisit the task of identifying the objectives, but with a stated challenge of approximately doubling the number of objectives identified. And there's a bunch of empirical work that they cite in their paper, showing that having that challenge results in people giving better answers and extracting better information from people, and the doubling was also scientific, based on the number of additional objectives people typically identify. It's 30 to 50% more or something. So they suggest this is a simple rule. Double your initial set of objectives.

The other big one is to offer a categorical format for generating the additional perspectives. Still, initially sit down and do what are your objectives, but then being offered categories and saying, "Given these categories, can you identify any other objectives that would be important to you?" And the idea that I had in reading their paper was that using something like the perma model from Seligman that we've talked about in the past, the model for well-being, that seems like a pretty good starting point for categories for setting objectives.

And then in the Bond, Carlson, Keeney paper, they also talk about how, if there is a master list of objectives available, it should be consulted, but only after deliberating about your own objectives, and then using the challenge and category tools to augment them. Morningstar actually has a paper where they talk about a lot of this stuff. And they do have in that paper, a master list, which I believe, if I remember correctly from reading the paper, was from actual surveys, where they did this type of exercise and used it to create the master list.

Interestingly, as I was working on this, Phil in the Rational Reminder community started a wiki post, where he references the Morningstar paper, and he started a master list of goals that other people can add to, so the community can have a community-generated master list of goals, which I thought was cool. I think, it could be augmented by adding in categories to the actual list. This is the other thing. I think, there's a lot of work to be done here. Just when you think about the research on the contents of a good life, and then see the list that Morningstar has put together. Number one, to be better off than my peers.

Cameron Passmore: Seems like an odd goal.

Ben Felix: Now, that's true. That's very important to people, empirically, but I don't know if it should be. Should, I guess, is a difficult word. But number two, to pay for personal self-improvement, to go back to school or learn a new skill, okay? To experience the excitement of investing.

Cameron Passmore: Really?

Ben Felix: Yeah. To start a new business, to buy a house, to help pay for kids' college education. Anyway, personally, not a fan of this master list, apologies to the authors at Morningstar of this of this paper. It's something that I... I don't know how we'll approach it yet, but I think it would be very cool to build a... And maybe it's for the Rational Reminder community, maybe working off of what Phil started. Maybe it's doing surveys with clients, Cameron, over a few years and developing a master list of what are people's actual goals. Anyway, there's a lot of interesting work that can be done there.

So, what is an effective goal? That's the next big question. Once we figured out what the main objectives are, and developed that list for a person, what does an effective goal look like? This is where Ayelet's stuff started to become pretty important in the stuff that I was thinking about. Financial decisions are typically pretty long-term decisions. It's not an immediate reward that you're going to get from saving money, for example, or investing, or waiting to buy something, or whatever. anyway, financial decisions tend to be long-term just by their nature.

Effective goals, and this is from Ayelet's book. Effective goals are statements of a desirable state, not the means to get there. They're abstract. She says, that based on the literature in motivation science, when goals are defined that way, they're powerful motivational tools that pull you in the direction that you want to go. The language, the framing of how the goal is defined is very important. Defining a goal in terms of its desired state, like having more time for leisure activities is my example, instead of its explicit costs, like spending money on a house cleaner, increases the motivation to achieve the goal.

When it's framed as a desired future state, rather than the means, there's a powerful effect on motivation and there's empirical work from Ayelet Fishbach and a co-author supporting that. Most of the statements that I'll make here are supported by experimental, empirical stuff. Abstract goals put the focus on the meaning of your actions, which makes the actions themselves seem less like a chore. Thinking about goals in the abstract makes people more likely to exercise self-control in their actions toward a goal. Again, Fujita and Carnivale, 2012, is the supporting literature there.

Now, there is a fine line where goals can become too abstract, if they can't be linked to a specific set of actions. There's no clear path to achieving the goal. People revert to fantasizing, instead of taking action. Fantasizing, again, empirically, about a goal seems to be negatively related to goal attainment. If you're not thinking about the specific actionable steps, or if you can't, because the way the goal has been defined, and all you can do is fantasize about the desired future state, it's negatively related to attaining the goal, as opposed to positively related.

Then another big consideration, this one is interesting, because we've talked about anti-goals in the past. Another big consideration is whether you should use approach goals, which is something you want, or avoidance goal, which is the anti-goals that we've talked about in the past. Choosing between the two, my understanding for a while was that avoidance goals are better, anti-goals are better, because they eliminate a lot of the issues with our weak affective forecasting abilities. We're not good at knowing what's going to make us happy in the future, so instead, think about anti-goals was what we understood for a while.

Ayelet gives a much more nuanced perspective on that. She says that choosing between the two... And it's crazy, right? We're talking about the language. What words do you use to describe your goal? There's all the science behind how that actually does make a big difference and whether you're going to achieve it or not. Choosing between approach and avoidance goals, she says, it comes down to the nature of the goal and the nature of the person. It's not one size fits all. Avoidance goals are most useful in preventing harm and escaping danger, while approach goals are better suited for achieving a positive desired future state. Avoidance goals are more urgent and less pleasant, and approach goals are easier to stick with in the long-term, because they are pleasant.

Some people, so this is the predisposition, which approach did you take to setting the goal, some people have a strong behavioral approach system, while others have a strong behavioral inhibition system. Those with a strong behavioral approach system will tend to do better with approach goals. Whereas, those with a strong behavioral inhibition system will tend to do better with avoidance goals. Now, people listening, how do I know which one am I?

In her book, Ayelet gives four statements. Statement one, when I want something, I usually go out and get it. Statement two, when I see an opportunity for something I like, I get excited right away. Statement three, I worry about making mistakes. Statement four, criticism or scolding hurts me quite a bit. If you agree with statements one and two, you're expected to do better with approach goals. If you agree with statements three and four, you're expected to do better with avoidance goals.

In addition to that, avoidance goals are better suited to stopping an unwanted behavior, like shopping online, or spending leisure time scrolling on Instagram, because that's more urgently stopping an unwanted behavior. In her book, Ayelet says that in general, even though it's not one size fits all, if we were to generalize, approach goals tend to be the better choice, when you are thinking long-term and defining a good life for the future. In general, under most circumstances, approach goals are more motivating than avoidance goals, but you've got to know yourself and you've got to know the specific objective that you're trying to achieve. It makes a material difference on average, in the data, it makes a material difference on motivation to attain the goal, which is just fascinating to think about.

Okay, so setting goals is work, which is crazy, because we haven't even started going toward achieving them yet, which is the real work; actually taking the actions to achieve the goal. Again, this is from Ayelet's book. She talks about how to turn a goal into action, you've got to create challenging, measurable, actionable and self-set targets. Challenging, or think about it as optimistic targets with minor consequences for failure, which was important, increases motivation and execution toward desired actions. That's Zhang and Fishbach 2010, was the study supporting that statement.

Measurable targets, I think this one's just pretty intuitive. They're necessary as a feedback loop to monitor progress. If you can't measure what you're doing, you're not going to know how you're doing. Then actionable is an extension of measurable, at least is the way that I understood it. Actionable targets are practically useful. In Ayelet's book she gives... I can't remember if this is her example, or my example. Whatever, it'd be similar either way. The example is exercising for 30 minutes each day, that's measurable and actionable. Burning 500 calories each day is measurable, but it's hard to measure. It's hard to measure exactly how many calories that you burned, so that's less actionable.

Then self-set targets, this one is really interesting. They maintain your sense of freedom. We know control is important to humans, or the feeling of having control. When people are told what to do, they're more likely to rebel against the instruction to regain their sense of freedom. That's old psychology research from Brem 1966.

A financial planning contest, I found this really interesting. We talked to Ayelet about this in next week's episode, but a planner might tell a client what they need to do to accomplish their goals. We chatted with Ayelet about what's an alternative? We decided that if you have the client partake in the analysis that arrives at the required action, because having the client figure out how much they can save, or spend to satisfy a goal. Then, maybe modifying the goal to suit their ability to save, or spend will be more effective than... I mean, it makes sense when you think about it. Can you imagine, oh, you have to save this much money. That's crazy.

According to the motivation science literature, that second approach will be more effective than prescribing the amount needed to satisfy a goal. Self-set targets is an important part of reaching goals. Then meeting targets shouldn't feel like a chore. This is another one that's intuitive, but I hadn't thought about it like this really. Goals shouldn't feel like chores. The means to achieving a goal shouldn't feel like chores. Intrinsic motivation to pursue the means toward a goal is one of the best predictors of adherence. That's Fischbach and Willy, 2016, where they found that, but I mean, just makes sense. I don't know how much evidence we need to support that one.

Of course, the implication for setting goals is important. If you don't enjoy the means, or if the mean, and this is another nuance. If the means doesn't feel like it's accomplishing the goal. So maybe you don't love doing the activity, but if the activity gives you immediate feedback that you're moving toward your goal, it'll feel good. If you don't have either of those things, it'd be more challenging to stick with it. Now, in long-term financial planning, it's tricky, right? Because the reward is very far in the future and saving is not always fun. You would call that extrinsic motivation. There's no pleasure in saving. Well, for some people there is.

You can make activities feel more intrinsically motivated if they achieve many goals. That could be setting quarterly targets, or something like that for savings amounts maybe, or even monthly targets. I don't know. Or when the activity is fun in and of itself, then it's more intrinsically motivating. In goal pursuit, it is really important to remember, and I think in financial planning, especially this gets lost often. In goal pursuit, we got to remember that people get pleasure from making progress toward a goal. This is research from Davidson, 1998. The progress principle is how you can summarize it. We get pleasure from making progress toward a goal. That's called pre-goal attainment positive affect.

From achieving the goal, and that's post-goal attainment positive affect. The progress toward the goal offers continued pleasure along the way, each step toward progress, while the post-goal pleasure is short-lived.

When it comes to pursuing goals, I think it truly is more about the journey, more about the daily experience of moving toward the goal than it is about actually achieving it. I think, people get stuck in the trap of, I'll be happy later. I'm going to do this miserable thing for the next 10 years, whatever the miserable thing is, to achieve this goal that I want, thinking that you'll be happy in the future. That ties back into the happiness stuff. People are bad at predicting what's going to make them happy in the future. Then specific to goal attainment, post-goal attainment is short-lived.

Cameron Passmore: They adapt.

Ben Felix: Yeah. You adapt to the new state. We've talked about how to set goals, how to pursue goals, and the last piece is organizing them. How do you take all this information and turn it into something actionable? Goals are almost certainly going to pull in different directions. Think about a good life has a lot of different ingredients, but they can be in conflict with each other, like spending time with family and career. I mean, that's one example. Balancing the means to achieving multiple goals, it's pretty complex task, especially with a lot of goals. I think, it makes sense to do some planning.

I haven't done this yet. I haven't built my own goal system, but I'm going to do it. Even though I've talked about the fact that I don't have goals before. Ayelet told us, “Well, you guys clearly do have goals, because you're doing a podcast. You don't just roll out of bed every morning and manage to accidentally do a podcast.” I think, she's right. I probably do have goals. I just haven't taken the time to articulate them. Anyway, so I will build a goal system. Hopefully, a template that'll go in this paper that I've alluded to.

Goal system, that you got the top-level abstract goals, and they're served by sub-goals, or means. Some of the means are multi-final. Meaning, they serve more than one goal. Some are equi-final, meaning that they're one of multiple means that serve the same goal. Some are uni-final, meaning that they serve only a single goal. Multi-final means might be something like, walking to work with a friend, which serves the goals of saving money on parking, getting exercise and socializing. That's an example of a multi-final means. Equi-final means are multiple means to achieve the same goal. Walking to work, hiking, and swimming, all serve the goal to exercise. Then a uni-final means might be like, saving for retirement, which is serving the one single goal of financial independence, but it's not doing a whole lot for you.

Multi-final means are efficient, and this is interesting. It's like, if it's an optimization problem, you want as many multi-final means as possible. That's the engineer answer. From the perspective of motivation, multi-final means can weaken the mental link between the top-level abstract goal and its means, which can actually decrease your motivation to continue doing that activity. Goal systems makes a relationship between means and goals easy to understand. It doesn't really tell you how to deal with conflicting goals, though. That's going to be a subjective decision, but there's some literature on this, too.

Resolving goal conflicts can be accomplished by prioritizing some goals over others, or by compromising between goals. When you view a goal as central to your identity, and Shaddy, Fischbach and Simonson, 2021, is the paper supporting this. Or, if you see it as a moral, or ethical issue, and Tetlock 2000 is supporting this, it make sense to prioritize. If you view a goal as central to your identity, or see it as a moral or ethical issue, it makes sense to prioritize that goal. Prioritization can also make sense when the marginal benefit of the actions toward the goal does not diminish. It's hard to think about.

For example, the marginal benefit of exercising after you've already done your exercise for the day is pretty low. The marginal benefit of finishing an assignment that's due tomorrow is high; continuing to work on that assignment, at the expense of some other goal. Then when goals have decreasing marginal benefits, it makes sense to compromise. That's it. I hadn't thought a whole lot about a lot of that. I don't even know if I should say this, but I'm going to say it. So often, I'll learn things and think to myself, “Wow, I can't believe that I've been giving people financial advice without knowing that.” It's always small. It's always small iterations in the grand scheme of things.

There's one paper from Morningstar talking about this. I think, it's got a lot of deficiencies. It's not like this is an obvious thing. You think about it, it's so important. Stuff like that happens all the time. It blows my mind.

Cameron Passmore: It's a great teaser for next week's interview. Ayelet was phenomenal, the conversation we had with her.

Ben Felix: Yeah, I agree. I thoroughly enjoyed that clearly, because it inspired me to write a whole bunch of stuff and to really dig into her book, but also, into a lot of the papers that she references in her book.

Be said, this research you're doing, it's going to be not one and done. You'll keep editing it over time as we learn more and meet more people and improve the study that you've done.

Yeah. It'll scale, too. That's the cool thing about is once we have a framework for a process for goal setting, I mean, even just the things that we talked about at the beginning, just the process of getting somebody to sit down and write out their objectives, and then asking them to double that list of objectives, and then presenting them with a list of categories and seeing if that spurs any more objectives. Just that is relatively easy to implement, like I'm thinking about with PWL clients. It's relatively easy to implement, and potentially has a massive impact. That scales, which is exciting.

In the David Blanchett 2015 paper that I mentioned, the utility model that he built to stochastically determine the optimal goal funding procedure. I think, we can recreate something similar to that. That's again, something that would scale and would be very cool.

Cameron Passmore: That's also a great setup for our conversation right now with Heather Riesman, to kick off the 22 and 22 challenge.

Heather Riesman, welcome to the kickoff of the Rational Reminder 22 and 22 Reading Challenge.

Heather Reisman: Happy to be here. Delighted to be here.

Cameron Passmore: We're so excited to have you here. Honestly, I don't think we could have chosen a more perfect person to kick off this initiative. I mean, you're literally a Canadian icon of reading to us.

Heather Reisman: Wow, that's a wonderful sobriquet, I would say. I'm very happy to have it. I'm happy to be here.

Cameron Passmore: It's pretty clear from your work and philanthropic efforts that you are on a mission to promote reading. Tell us, why do you think reading is so important?

Heather Reisman: Well, first of all, there's the pure joy of reading. It's always important to have something that's a joyful activity. Right now, in the midst of this pandemic, and what I think will be at least a year-long recovery, there's just the pure joy of reading. Let's just start with that, the pure joy of reading. It's funny about that pure joy thing. We live in a world where so much is after our attention.

There's all this stuff coming at us, coming at us, coming at us, that we can forget how much fun it is to open a book, get attracted by the first two paragraphs, and then get lost in an experience. There's the pure joy of reading. There's a lot else about reading. I mean, it's well-known that reading builds empathy. It puts you in the shoes of other people, sometimes other people in your own country, but people from different walks of life, different circumstances, whether it's fiction, or it's non-fiction, or it's memoir. In a great book, you get into the soul of the people you're reading about, and that just helps build empathy.

What do we need in this world? We need a greater amount of empathy, the ability to feel for others, to hear others, and to find ways for them to hear us. Number two, it is just an amazing way to build empathy. Empathy helps live a purposeful life, allows you to connect. It allows you to build relationships close to you, and then in ever more outer concentric circles. I just think it's amazing for empathy. Then there's just a whole lot we could talk about, and I don't know how much time you have today about the importance of reading for children, and what that does to set children up for a lifetime ability to achieve their full potential. To me, it's just got everything. It has everything.

Ben Felix: Heather, you influenced the reading decisions of a ton of people. I mean, like Cameron said, you're probably one of the most influential readers in Canada through your Heather's Picks. How do you though, decide what to read?

Heather Reisman: It can be totally random and totally specific at the same time. That is, if someone I trust says to me, you have to read this book, it could be a scientist doing work in an area I'm interested in that I happen to get to know over the years, or a best friend, or a member of our amazing reading team, or even a customer writing to me. I have all kinds of customers that write me and say... It can be random from that point of view. Then there are things I am interested in that cause me to go and search out books. It can be totally random and it can be totally specific.

What I will say, because this is a question I get asked a lot, how do you read so much? Well, first of all, I don't read so much. I wonder if in this discussion, if the two of you read more than me. I am lucky, I try to read a book a week. If it's an amazing week, I get two. If I'm on vacation, maybe I can get to two or three books. I probably only read in the course of a year, maybe 75 books. That's it. 10,000 new books come out every year. 10,000, just in English language, and maybe that number has gone up since the last time I checked.

I think, people imagine much more. If you're reading 75 books a year, it could sound like a lot, but it's not that much. I just want to say that. I probably read 75 to a 100. I might start 200, or 250. I'm at the point that if I start a book, and if 15 pages, or 20 pages in, I am not into the book, it's got to be a really special book, or written by somebody really incredible to hold my attention past that. I have to admit that.

Now, if somebody's off the charts, and I'm just struggling with it a bit. I'll struggle longer, maybe up to a 100 pages, because my feeling will be maybe it's me that's not doing such a good job here. In general, so I probably start. I might start 250 books, 275 books to get to a 100, or maybe it's a bit more, but yeah.

Cameron Passmore: Our challenge, Heather, is 22 and 22. I've had a number of listeners reach out and say, “Ooh, that's a lot. I'm not sure I could do that many.” That's fine. You're talking about 75. Can you talk about what your daily habit is? How long are you reading each day?

Heather Reisman: I love your question. By the way, you probably already covered this book, but do you know Atomic Habits by James Clear?

Cameron Passmore: Yup.

Heather Reisman: You use the operative word. The operative word is habit. The first question one has to ask is, are they interested in reading? Do they want a reading habit? Do they want to? I've heard so many people say, “I just wish I read more.” Probably thousands of people have said that to me without exaggeration. I often think, of those thousands, maybe more over these years, tens of thousands, there's some number who really do want to. Some number who may not really want to.

To me, the difference is, and so I'm going to get to the habit part is, if you really want to. You have a story to tell about how you made this a habit. If you want to, and what you say is, “But I just don't have the time.” I always say to people like that to do what I do, and I do it a couple of times a year, because I find it so illuminating about my own potentially negative habits. I go through a couple of days and say, how much time am I spending surfing the net on Instagram, playing Wordle? I'm not giving up Wordle. I'm just telling you that. I know how much time I spend doing crossword puzzles, Wordle, spelling bee. I want to do those things. They're really fun, but they take time. I go through and I say, what am I doing that I might be willing to put aside? That's number one.

Number two, a really easy habit I've gotten into is, every time I work out, I try and walk a minimum of 15 minutes a day, whether I'm walking to work, or I'm walking in my neighborhood, or walking on the treadmill, depending on the weather. I always have one book on the go on audio. I love audio. I love audio. Actually, Indigo is going to do a lot with audio soon. I love audio. I always have an audio book, and I always have a reading book. My reading book, I do that before I go to bed. That's two times.

My habit is I don't take technology into my bedroom, I always have a book by the bed. I try and read a minimum of 15 minutes to a half hour by my bed. Then I read when I travel. That's my habit. If I'm flying, I read. If I'm going to bed, every night, part of my ritual, it's my ritual to wind down and get myself disconnected. It's really hard to disconnect. I'm one of these people that loves my iPhone. I don't bring it into my bedroom anymore. That's my habit. On the treadmill, or when I'm walking, that's my favorite easy time. When I go to bed, such a wonderful ritual, and when I travel.

Ben Felix: You mentioned attention, and you're just mentioning social media and the phone, the iPhone. Now, you're involved with the production of the social dilemma, which I think a lot of people that are listening have probably seen. Do you think that reading books helps with any of the mental health issues that stem from social media use?

Heather Reisman: Thank you for mentioning social dilemma, because it was a real three and a half year labor of love. Let me say that social media is addictive by design. It's deliberately touching a part of our brain, which is a addictive part of our brain. All of us, we are all being addicted. Social media applications, Instagram, TikTok, Facebook, any of these platforms are deliberately... They know how to addict us. They track our behavior. They know what we like to watch. Then they feed us more of that. Or the famous like button. That like button was all about addiction, all about addiction. We're all addicted, all of us. I put up my hand, absolutely.

I would just say, if you're conscious of it, you realize you're not controlling your own life, somebody else is controlling your own life. If you want to live life on purpose, whatever your own purpose is, there is no easier habit to build than a reading habit, if you do it deliberately. And I think, if you do it, you will find that you enhance your sense of calmness, your sense of ability to think. Do I think reading contributes? Yes. And in particular, reading long-form.

There's an amazing book you might want to bring to your readers, it's called Shallows. Shallow, or Shallows? I can't remember, because a while ago since I read it, about the importance of long-form reading. Long-form reading is good for our brains. Long-form reading is good for our brains, it settles our brains, it allows us to think more clearly, it's calming. Long-form reading is calming. It's the joy of reading. It's the calming of reading, and it lights up parts in our brain that contribute to our well-being. And that's just science.

Cameron Passmore: You were part of the creation and launch of the Kobo e-reader. If someone asked you, “Heather, should I read digitally, or physical books?” What do you say?

Heather Reisman: I think, it doesn't matter. I think, if you're reading long-form, any way that you're reading long-form is great. Any way that you're reading long-form is great. As I say, I think listening to long-form books is good, too. I personally, here's what I can say. If I want to really remember stuff, which if I'm reading non-fiction, my brain, the way my brain works is, if I read a physical book with a yellow highlighter, I retain more than if I read a digital book and highlight in digital. Then I retain more if I read a digital book and highlight, than if I'm listening to audio.

I find, whenever I listen to audio, if I'm hearing something I want to remember, I literally have to stop in my tracks and play it over and over and over, so that I can remember it. I don't know what other people find. I haven't actually seen the latest research. There's a lot of research going on on this. I can tell you, my experience is physical book where I'm turning the pages, and I'm experiencing the left-hand side and the right hand side. I remember where I was in the book, what side of the page, where I read it better than digital books and way better than audio. That's my experience. What's yours?

Ben Felix: We're just talking about this the other day, Cameron and I offline. I often do audio book first. If I find things that I like, that I want to remember, like you're just mentioning, I'll go and purchase the e-book, because then I can search. I can Ctrl+F and find the thing that I wanted to remember, and it's there. Then if I really like the book, I'll buy the physical hard copy to stick it on my bookshelf.

Heather Reisman: Okay. From my point of view, reading is what's critical. I happen to be among the group of people, and fortunately, there are a lot of them, who do enjoy reading physical books and owning them. Listen, what I'm here to say today is read and read long-form, because it just has so many joyful elements, and so many benefits.

Ben Felix: Can you tell us about the mission of the Indigo Love of Reading Foundation?

Heather Reisman: So glad you asked about that. I'll tell you about the mission. To tell you about the mission, I have to tell you a little bit about the origin. Way back in 2002, I think 2002, I got a call one day from my Alderman saying that there was a school in my riding where I live, which was a high-need school, and they just had a fire, and they didn't have a lot of books and would I send over a box of books. It was quiet day. 2002 Indigo is a slightly smaller business. It was a quiet day, and it's right around the corner from me. I thought, “Oh, I'll just go over and see what their library looks like.” I walked into a school in downtown Toronto, eight minutes from Eaton Center, so that's where it's located. I almost fainted when I saw their library. Forget that there was a fire. They showed me pictures of what was in the library before and what they had left.

They had a couple of cardboard boxes, even the books that they had kept from the fire, so they had all their books. Now they were singed. They had a few books, literally a few books in cardboard boxes. The average age of the book had to be 20-years-old. I thought, “How is this possible? Is it only this school?” Well, that caused me, they had a most extraordinary principal, a PhD, principal with a PhD passionate about reading. She said, “Heather, you can't imagine what's going on in high-need schools.” She said, all schools have no money for books. In middle and upper class, the parents are helping the libraries get books. Anyway, they have books at home. In high-need schools, often, they don't have them at home and the schools have none.

That led to our decision to learn more about it and then to found the Indigo Love of Reading Foundation. Our mission is to provide as many high-need schools in the country as we can with sufficient books to enrich their libraries. What we did was and this was an astounding fact that we found. Do you know that way back before either of you was born, but I was around, in the 1960s and 70s and even up to the early 80s, the average public school got three new books per kid, per year for their library? If they had 200 kids, they got 600 books. New ones, to keep refreshing the library. I defy you to guess what the current percentage is. Take a crazy number. I mean, now books are more important, right? What do you think?

All right, I'll tell you. You won't guess. Less than a third of a book per kid, in high-need schools, all across this country. Our short-term mission raise on debt is with the money we contribute, and the money that our customers help us contribute to give as many high-needs schools in the country, every year, to bring them up to the level that it used to be in the 60s and 70s, to replenish their library. We make a three-year commitment and we contribute anywhere from $50 to a $150,000 against their current budgets of anywhere, you won't believe this, from $50 to $250 a year. Some get up to a 1,000, if they've got a 1,000 kids, or 800 kids. That's our short-term mission.

Our vision is to have this problem so well understood that provincial governments will make it absolutely a priority for high-need schools to be richly equipped with books. Now this, I'm going to give you a statistic that the two of you are going to love and you're going to do something with, and I challenge you to do something with this.

Today, roughly 34% of adult Canadians are functionally illiterate. Meaning, they don't have enough literacy to fill out an application form, to critically read a newspaper. You're going to think, “Well, are those mostly immigrants?” No, they're not. They're mostly not immigrants. They're mostly Canadians. For every 1% that we increase the literacy rate in this country, we add 16 billion dollars to the economy over the lifetime of that cohort. Now imagine, and I invite you to join me in solving this problem. That's what the Love of Reading Foundation is about.

So far, we've put close to 30 million dollars into schools in this country. I'm proud to say, it's the most significant amount of money that's been put into high-needs libraries in school in the history of the country. And I do say that with pride.

Cameron Passmore: So you're here to help us launch an online reading challenge for our podcast community. How do you think about a community and how a community might help someone who does want to read more?

Heather Reisman: It's hard to think about it at that community level, because what's the organizing principle? How is the community organizing? What would be the vehicle through which a given community would organize? Would someone in the community become the leader, the captain and trying to get other people to do it? Then to understand the issues and then to decide how they... What would the organizing principle be?

Cameron Passmore: It's going to be a website. It is a website, where people commit to reading a certain number of books. They're basically making a public commitment to accept this challenge.

Heather Reisman: Oh, on the individual?

Cameron Passmore: On individual levels. As they go through the challenge, they're going to get rewards and acknowledgement from those of us in the group. It's about making a public commitment.

Heather Reisman: Oh, okay. You're really saying, you're considering Canada the community, or maybe it's beyond Canada. And you're going to create this wonderfully interactive website, and you're going to inspire people through the communication and content on this website? Is that what we're doing?

Cameron Passmore: Correct.

Okay. Well, the more exciting the content is, the more people have a chance to share their point of view about what they love to read. The more you can organize by passions. We do find that if someone is really interested in learning how to live green, live in concert with the environment, they're going to want to know what's worth reading, what's worth looking at, what's worth watching. We've generally found that two things inspire reading. If you can help people access around the things they're passionate about, and then talk to each other.

Heather Reisman: I'm a massive fan of book clubs. I belong to a book club all my life, more than one. I'm not in the same book club I was in high school, but literally, my first book club, I was in grade seven, and you can tell, it's a long time since I was in grade seven. So I think if you can create digital book clubs, where people can talk online and engage in their own little book club, I just think it would be phenomenal. Passions, book clubs, like-minded people exchanging views. Yeah. Recommendations.

Ben Felix: What words of parting advice do you have for listeners who have an objective of reading more this year?

Heather Reisman: Well, I think the point you made right at the beginning, there's nothing like being deliberate about a habit. I love James Clear's idea of atomic steps, meaning little tiny steps. If you're going to suddenly commit to reading 200 books, there could be the odd person who can really do it. But whatever your current reality is, if you bumped that up, if you were reading two books a year, and you're going to say, I'm going to try and do one a month, that would be massive progress.

I think, setting a reasonable target, and then making it a habit, and reinforcing a habit. Finding, what's the time of day. If you read just 10 minutes every night, by the end of the 30 days in the month, you got your book done. If you want to do it in the gym, do you want to do it at night, you take the subway to work. It's declaring a habit. That's why, Cameron, I was so inspired by your decision to get up in the morning and read. When do you read?

Cameron Passmore: I read from 5 to 6:15. And to your point, Heather, it doesn't take a lot of time to go through the books. I read an hour, hour and 15, and I've already read eight books this year. The books just melt away. Yeah, some days I've read longer. You get that atomic habit, and by the way, Atomic Habits is on our 22 recommended books for 22. The books just happen. It's just the daily habit.

Heather Reisman: Yeah, it's just the daily habit. Then it's a priority, right? I'll just tell you this in closing, that you know one of the things that James Clear talks about is habit stacking. So find something you love to do. I love to play Wordle and I love to do crosswords. So if there's something I'm trying to build a habit on, in my case, I'm trying to extend my meditation time. I say, "Okay, I'm not going to let myself do this puzzle, until I've done my meditation." And it's really worked. So I think if someone's trying to build a reading habit, what is something that you just love to do with all your might, and if you say, “Okay, I'm going to get to do that thing I love, but first, I'm going to do 10 minutes, or 15 minutes of reading.” Maybe falling asleep is your favorite thing, so do it before. Bedtime is just great, because reading before you go to sleep accomplishes so much. Again, the research says, it allows you to wind down.

Heather Reisman: If I combine my passion for reading with the social dilemma, I would just say, nothing can be as transformative and supportive of your reading habit as not bringing your phone into the bedroom. Bring your book to bed.

Cameron Passmore: I agree. Heather, this has been a great conversation. Thanks for kicking off this challenge. Again, you could not have been a better guest. So thank you so much.

Heather Reisman: You're so welcome. My pleasure. Thank you for all you're doing to encourage reading.

Cameron Passmore: Thank you. Thanks, everyone for listening this week.

Books From Today’s Episode:

The Culture Code — The Culture Code: The Secrets Of Highly Successful Groups, Book by Daniel Coyle (Hardcover) | www.chapters.indigo.ca / https://amzn.to/3oBQhlM

Drive — Drive: The Surprising Truth About What Motivates Us, Book by Daniel H. Pink (Paperback) | www.chapters.indigo.ca / https://amzn.to/3Bm2ctb

Get It Done — Get It Done: Surprising Lessons From The Science Of Motivation, Book by Ayelet Fishbach (Hardcover) | www.chapters.indigo.ca / https://amzn.to/34sYtxN

Atomic Habits — Atomic Habits: An Easy & Proven Way To Build Good Habits & Break Bad Ones, Book by James Clear (Hardcover) | www.chapters.indigo.ca / https://amzn.to/2Ra5NnF

The Shallows — The Shallows: What The Internet Is Doing To Our Brains, Book by Nicholas Carr (Paperback) | www.chapters.indigo.ca / https://amzn.to/3uBMVmj

Links From Today’s Episode:

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.
Rational Reminder Website — https://rationalreminder.ca/ 

Shop Merch — https://shop.rationalreminder.ca/

Join the Community — https://community.rationalreminder.ca/

Follow us on Twitter — https://twitter.com/RationalRemind

Follow us on Instagram — @rationalreminder

Benjamin on Twitter — https://twitter.com/benjaminwfelix

Cameron on Twitter — https://twitter.com/CameronPassmore

Heather Reisman on Twitter — https://twitter.com/HeatherReisman

Heather Reisman on LinkedIn — https://www.linkedin.com/in/heather-reisman-3bab2319/

Heather Reisman on Instagram — https://www.instagram.com/heatherreisman/

Indigo — https://www.chapters.indigo.ca

22 in 22 Reading Challenge — Join the Rational Reminder’s 22 in 22 reading challenge!

Ben’s Reading Code (22 in 22 Challenge): 7XWESMK

Cameron’s Reading Code (22 in 22 Challenge): N62IPTX

'The Value of Goals-Based Financial Planning' — https://www.financialplanningassociation.org/article/journal/JUN15-value-goals-based-financial-planning

'Generating Objectives: Can Decision Makers Articulate What They Want?' — https://www.researchgate.net/publication/220534710_Generating_Objectives_Can_Decision_Makers_Articulate_What_They_Want

'Mining for Goals' — https://www.morningstar.com/lp/mining-for-goals

'Trade Offs in Choice' — https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3779765