B-school dean's first mortgage? 17% nail biter

Carol Stephenson is dean of the University of Western Ontario’s Richard Ivey School of Business and was recently named one of Canada’s most powerful women for the third time. In our series on the financial habits of notable Canadians Dean Stephenson told the Toronto Star’s Emily Mathieu what she learned working as a part-time telephone operator, the advice family members who lived through the Depression passed on and why she wishes she had made an earlier move to sell Nortel shares.

How did your family influence your attitude toward money?

My parents experienced the Depression. As a result, they were very frugal. They taught me that you should minimize your outstanding debt.

What is the best financial advice you ever received?

My father encouraged me to purchase my first home. That was in the early ’80s when interest rates on mortgages were 17 per cent. I took the plunge, including a second mortgage. I was biting my fingernails but it turned out to be a great decision.

Describe your first job, what did it teach you?

I was a part-time telephone operator while attending university. It taught me the importance of customer service. I also learned a lot about people. Yes, human behaviour changes with a full moon.

What was the first item you purchased with your own money?

Stereo system and clothes — what every young woman desires.

What is your best money-saving advice?

Buy low, sell high and don’t make an excessive number of stock trades. Be consistent and patient. Get rid of the “dogs” though.

What is your worst spending habit?

I spend too much on clothing.

What hard financial lessons have you learned?

I didn’t sell my Nortel shares when they were $124. My mother sold hers at $124 when I recommended she sell. Finally, I sold mine at $13. She had the last laugh.

What financial advice would you pass on to students?

Try to repay debt as quickly as you can and start saving so you can invest in your first real estate purchase. I know it seems strange to think about saving at such an early date but if you force the habit it is amazing how much you can save. One of the best ways is through direct debit from your pay cheque — if you have your pay deposited directly, allocate a certain amount for savings. Putting savings in a separate account also helps.

What in your mind is one of the most important financial lessons or basic principles passed to students at Ivey?

Just as companies need to have good balance sheets, so do individuals. So pay attention to your own financial planning. Also, we teach the habit of giving back when you can to a charity of your choice. Part of Ivey’s mission is to contribute to the societies in which we work.

How do you prefer to pay, cash, card or debit?

Credit card and debit.

Do you bank online?

Yes.

How do you tip?

Very well, especially for good service.

What is your retirement plan?

I have tried to save my money every year for retirement including making sure I maximize my RRSPs.

Are money and success the same thing?

No. There are lots of successful people who are not wealthy and vice versa.