Xian: Being debt-free not a smart money-making idea
Publish Date: 
Mon, 2013-08-19 16:41

 

Most Chinese-Canadians tend to believe that being debt-free is glorious, but that is in fact a wrong idea in today’s world as far as wealth accumulation and financial management are concerned, according to a leading Chinese-Canadian insurance guru.

Xian Shenglin, founder and chief executive officer of Shenglin Financial Inc., told a financial management forum on Aug. 17  that the conventional wisdom was that  rich people must be free of debt and have millions of dollars in the bank, with huge houses and luxury cars paid off with cash. But this is no longer true today. He pointed out that modern financial management stresses “leverage”—making money and getting rich with borrowed money.

“To be a millionaire today is not a big deal,” Xian said at the forum held at the Shenglin Financial Center building—his corporate headquarters in North York, Toronto. But to be able to get a million-dollar credit is cool , he added.

If you have a million dollar in cash, don’t let it sleep in the bank. Use it to borrow as much as possible from the bank, whose interest rates are at a historic low, Mr. Xian, the only Chinese-Canadian wearing the hat of Wealth Coach, advised. Use the borrowed money to invest in financial products that are safe and more profitable. That’s what “leverage” is all about, he said.

But he cautioned the audience against “bad debt” and “bad assets,” which mean, respectively, debt without security guarantee, and high-risk assets such as stocks or easy money from unconventional banking. But above all, Mr. Xian warned against greed, a dangerous weakness in human nature that has been often the major cause of a disastrous investment. “When something looks too good to be true, don’t touch it. It could be a trap,” he warned.

In the forum, titled “capital maneuver and wealth accumulation,” Mr. Xian taught the audience about the “do’s and don’t’s” in investment out of his two-decade experience in advising the affluent cliental, some of them are superrich.

Shenglin Financial, which is affiliated with London Life, one of Canada’s oldest (128 years) and most-trusted name in insurance industry, has been one the top sales producers among London Life’s affiliates. He told the audience that the safest, surest, and fastest way of making money is not to deal with the banks, but  invest in London Life’s risk-free, high-yielding and tax-exempt financial products, such as the popular Par Life.