Rempel Maximum – The Story of Joe & Rich

How can your life really be different if you focus on maximum wealth-building principles?

It’s not about the money. It’s about your life.

This story is an extreme version of the life of an ordinary person managing his money exceptionally.

The concepts are in my last post, “Rempel Maximum – 5 Steps to Becoming a Multi-Millionaire”.

We often hear that building wealth is just about numbers. But here’s the truth: the numbers are just the tools. What really matters is what those numbers do for your life.

In this article, you’ll see the stark contrast between two ordinary guys—Joe and Rich—who made radically different financial choices. 

One followed conventional advice. The other followed a plan most Canadians don’t even know exists.

In my latest video, podcast episode, and blog post you’ll learn:

• Why conservative investing may quietly sabotage your retirement, and what you can do instead.
• How aggressive (but smart) leverage can massively increase your net worth.
• The truth about long-term stock returns compared to balanced portfolios.
• How the Smith Manoeuvre can create wealth without using your cash flow.
• What “last decade risk” is, and how to avoid it derailing your retirement.
• The power of tax-efficient investing and how to compound your tax refunds.
• How building wealth gives you more than luxury — it gives you freedom, confidence, and impact.
• Why hardly anyone should actually follow these principles to the maximum.
• What living an “exceptional life” actually looks like when you manage your money exceptionally.

The Story of Joe & Rich

Joe and Rich were childhood buddies, graduated from university at 22, worked together at the same salary and both saved $10,000 per year until they retired at 65. They both saved 20% down to buy a $400,000 home.

But they were not the same. Joe is a conventional guy. Rich read all about the Rempel Maximum wealth-building process and committed to doing it to the maximum. He wanted to try living an exceptional life.

Joe valued safety and just wanted everything low risk. Rich valued freedom – the freedom to live the exceptional life he wants.

Joe used conventional methods. He invested in a conservative, balanced portfolio making a 5% return, bought his home at 29, and retired at 65 with $963,000 in investments. He retired reasonably comfortably on $55,000 per year with a middle-class lifestyle. Joe loved travelling, but was satisfied taking a couple trips every year.

The Road to Freedom

Rich wanted an exceptional life. He wanted financial freedom, but also self-confidence from having a huge net worth. He decided to build the largest investment portfolio he could.

He started by investing more aggressively with 100% in equities, making an 8% return over time. He saw the evidence that stocks provided more consistent long term growth than bonds or cash.

He was determined to avoid “last decade risk”. Traditional slow & steady wealth-building means that the vast majority of the investments most people own during their working years are in the last few years before retirement. With traditional methods, one bad decade just before you retire can ruin your retirement.

Rich wanted a large portfolio while he is young, not just the last few years before retiring. Every year, he borrowed to invest as much as he could qualify for. Initially, his only option was a 3:1 loan on the amount he had invested. He invested his $10,000 savings plus $30,000 from a loan every year. The loan was a “no margin call” loan, so he would not be forced to sell if his investments declined.

When he bought his home, he did the Smith Manoeuvre strategy to invest more without using his cash flow. As his mortgage was paid down, he borrowed the same amount to invest, which slowly converted his mortgage into a tax-deductible credit line.

The Smith Manoeuvre helped Rich with his broader strategy of maximum wealth building. He found he could use the investments from the Smith Manoeuvre to qualify for a larger investment loan. Every year or two, he increased his investment loan to the maximum he qualified for. His higher net worth gave him more loan options.

Every year, he saved $10,000, borrowed $14,500 from his secured credit line and increased his investment loan by $74,000. His investment loan was getting large, but his focus was on his net worth, which was rising faster.

Rich invested very tax-efficiently, trying to defer all the tax on the growth of his investments. He invested for long-term growth – not income. Meanwhile, he claimed large interest deductions every year on his investment loans and the investment credit line on his home, reinvesting all his tax refunds.

Rich retired at 65 with a portfolio of $12,940,000. He owed $2,540,000 on his investment loans, which gave him a net worth of $10,400,000, not including his home. His large portfolio gave him a retirement income of $535,000 per year.

He felt very confident with his high net worth. He owed a lot of money, but was comfortable with it. He did not want to sell any investments to pay off the loan, so he kept it right through his retirement. He paid $101,000 per year of tax-deductible interest every year, but could easily make those payments from his high income.  He was glad to still have a large tax deduction after he retired, which most seniors don’t. He still had $435,000 to spend every year.

He considered slowly paying off his investment loan during his retirement, so that he would die debt-free. In the end, he decided to let his estate pay off the loan. He did not want to leave a large inheritance, preferring to enjoy his retirement and do something meaningful with his life.

Throughout his life, he always had faith that his investments would grow long term, patience to wait, and discipline to stick with his plan.

The Life of Freedom

Rich lived exceptionally well, travelling extensively, taking long trips to several new places every year. He always invited friends or family to join him on his vacations. He was a long-suffering Toronto sports fan, with seasons tickets to the Leafs, Raptors, Jays and Argos, as well as the theatre.

He bought a nice cottage on a lake, mostly for his extended family to hang out together. He sold some investments and paid cash, but then immediately borrowed 75% back to invest, to minimize the effect on his portfolio.

Rich knew many people that had suffered from cancer, so he made very large donations every year for cancer and several other charities that were meaningful for him. He felt proud to have several charities mention his name on commemorative plaques.

From Bill Gates, he got the idea to setup “Rich’s Charitable Foundation”, which would outlive him, continuing to support the charities important to him.

Rich’s huge portfolio gave him such a great feeling of self-confidence and security. His life was full of great options and he loved the freedom.

More valuable to him, though, was that he felt he was an inspiration to his family and friends as to what one ordinary man can do just by managing his money exceptionally.

The Point of the Story

This story is an illustration only of the principles in my next article: Rempel Maximum – 5 Steps to Becoming a Multi-Millionaire.

The “Rempel Maximum” is a process to build as much wealth as you can in a solid, reliable way. It is best to think of the Rempel Maximum as a concept – a set of tools, not a recipe. Do none of it, a bit, or the amount you are comfortable with that will give you the life you want.

It can include a variety of tax and investment strategies (tools). You can choose which of these tools make sense for you and how big or small to go.

A quick caveat. Doing these ideas to the maximum is probably not for you. It is only for the perhaps 3-5% of people that are aggressive wealth-builders, have a high risk tolerance and are highly motivated to become wealthy. Even these wealth-builders should probably not push it to the maximum.

Why build wealth? It’s not about the money. It’s about your life.

The benefits of being wealthy are hard to put into words until you get there. There is the obvious great lifestyle, but the emotional benefits are most important.

Security. Freedom. Self-confidence. These are priceless.

Ed