The Great American Senior Show

Wealth Advisor and Adventurist David Rosell Shares Wealth Secrets for Retirees

June 17, 2022 Sam Yates Season 2 Episode 75
The Great American Senior Show
Wealth Advisor and Adventurist David Rosell Shares Wealth Secrets for Retirees
Show Notes Transcript

For retirees, wealth retention is more important than wealth accumulation in the second part of your life. That's one of the secrets shared with the Great American Senior Show by author and Wealth Advisor David Rosell

The Great American Senior Show's grey-hair host Sam Yates welcomes back the author of Failure Is Not An Option to discuss the fall of the Berlin Wall and how history seems to repeat itself. 

We'll also find out Rosell's viewpoint on Exchange Traded Funds and the Rule of 72 and whether inflation is a worrisome factor for today's retiree on this edition of the Great American Senior Show.

Sam Yates:

Hello, everyone, and welcome to another exciting convention with the great American Senior Show. I'm your gray haired host, Sam Yates, back with us today, David Roasell. David has been on the program before and we got into a discussion of what he does and how he does wealth advisor, a world traveler adventure to the to the absolute ninth degree. And I say that quite complimentary because David has found a way to merge all of the things that he enjoys doing and does so very well into a book. And David has also done speaking engagements. Quite a fascinating person. But David, welcome back to the program.

David Rosell:

Sam, it's great to be back here you say the gray haired host. But I always say that graying now means playing so good on you.

Sam Yates:

Well, I appreciate that. And I do try to get a little play. And once in a while it comes with a territory of having that gray hair. But when we last left our wealth advisor hero, we were looking into the crystal ball and talking about things coming up into the future. You've been at this point in history before where there are things going on in the world that have a dynamic impact. And in particular, I'm thinking that the year was 1989. Was it in November, I believe, and you were in Europe, tell us what happened? Yeah,

David Rosell:

I was in Europe, attending school, the year before I went, I spent a year studying in London. And when I was in London, our German professor had a class going to Berlin. And we went there and saw the wall. And at that time, that was the number one fear that students had was a fear of a nuclear war, we are right in the heart of the Cold War. And, you know, sadly are in today, our heart goes out to the people of the Ukraine. And you know, they always say history repeats itself, and it might be doing that right now. But at that time, we had never an inclination that in our lifetime, the wall would be be coming down eventually, in the cold war would end. So a year later, oh, November 9 1989. Life found me in Istanbul, Turkey. And we were looking through the department store window at television sets and it looked like the Berlin Wall was coming down, people were chopping at it. So I got on the next airplane air Yugoslavia and flew directly into Berlin and was part of what might have been the biggest celebration, planet Earth has ever experienced. It was incredible. That was the time when Ronald Reagan said Mr. Gorbachev tear down this wall. And the impossible, truly became a reality. But where I tied it into the book was that who would have thought that the impossible would become a reality. 20 short years later, when the financial walls came tumbling down. And it's hard to imagine when we look back, but the largest financial firms in every sector, either declared bankruptcy or no longer exist. And so the way that we do planning for people in the second half of their financial journey, those who are at or near retirement has certainly changed since that time.

Sam Yates:

David, I mentioned earlier in the introduction, that you're a speaker, you're a wealth advisor, you do many things. Tell us a bit about what you do as a professional speaker.

David Rosell:

Oh, well, speaking is certainly one of my core passions. It's just one of those things that I'd be doing even if I wasn't getting compensated to do it. So I get called upon from different groups around the country, Vistage International, which is a group of CEOs where I'm speaking next week in San Diego, to the million dollar round table and in other groups when they're looking for information on the second half of the journey, because the planning and the financial instruments that get us to the top of the financial mountain may not be the same types of planning and instruments that will help us get down the mountain and do so alive which really means getting to the end of your life without outliving your resources, having peace of mind and living the life that you've really always imagined. If

Sam Yates:

someone would like to engage you to be a speaker or they know of a speaking opportunity, your book or just didn't General find out more about David Roselle. How can they go about doing that?

David Rosell:

Oh, thank you for asking Sam. They can certainly get the books at Amazon or Barnes and Noble or audible. But they can reach out to me directly, which I'm very open to. My email address is David at Roselle wealth management.com. That's our o s e l l. And my direct line is 541-385-8831.

Sam Yates:

I enjoy speaking to people that have an impact on other people's lives a favorable impact. And certainly that as you when you are looking at the opportunities someone may bring to the table as a potential client. What do you look for,

David Rosell:

we have a very focused practice of you know who the right fit client is for our practice, and it's people who are at or near retirement, they have accumulated a certain amount of wealth. For us, we don't really advertise or promote this, but it's a $2 million minimum of investable assets, because we find that we're able to be the most value to people with those types of challenges. And more importantly, it's just people that feel a good energetic bond with us. And we feel a very good, energetic, energetic bond with them. Because this is not a transactional relationship. This is a relationship where as long as there's that mutual trust, it will last a lifetime.

Sam Yates:

What is your future? You're not on that downside too far that you don't have a future? What's the future hold for? For you?

David Rosell:

Is that question for myself? Personally, my business or a combination of both?

Sam Yates:

I think it would be a combination of both. I'm interested in both.

David Rosell:

Yeah. So you know, when I was younger, especially when I entered this business, my goal was to retire at as young age as possible. And over the years, I've come across so many people who enter their years of retirement, the wind comes out of their sails. As a matter of fact, any idea where the word retirement comes from Sam? Well, most people aren't aware of this. But it comes from the Latin word with tear, which means to end or be put out of use. Because two generations ago, people would work for the same company, their whole career, they'd get that gold watch. And three years later, they were dead. And now people are retiring earlier, they're living longer. And they're spending 234 decades in these years, and no one that we know, wants to end or be put out of use. So I've changed the terminology to being financially independent or independent of the paycheck rather than that more negative word retirement. So because I've learned from watching so many people enter these years or actually be put out of use, I have really re geared my working life where I'm spending almost all of it, doing my unique ability, which are the things that I'd be doing, whether I was getting paid or not, in the things that I no longer find joy in. I'm elevating by delegating and getting people to do those tasks, where it's their unique ability. And so I plan on continuing to work for several more decades, well into my 70s. Working not as hard but really looking to continue to keep joy in my life. Because I think the least selfish thing we can do in this lifetime is be happy. Because when we're happy, we're not a burden on anybody.

Sam Yates:

I think you hit the nail right on the head. And I admire you for being able to do that and have the commitment. So many people say they want to do something like that. And they just don't and when they retire or they are no longer in use. They deteriorate very, very rapidly. I want to change topic a little bit because I know right now someone is smiling at you and that's probably grandma Ruth, you mentioned her in your books. I was I chuckled to myself, that you you have a photo of her that is in was it in your conference room or in your office?

David Rosell:

Yes, it's just right next door right here in the conference room, a big picture and people when they first time they enter they always ask Who is that woman up on the wall? I'm delighted that you brought up one of my favorite people that that has lived and she made an enormous impact on people's lives and especially my life at a young age. Grandma grew up and lived through the Great Depression. It was a time I am when a lot of women didn't attend college and she graduated number one in her class at a Brooklyn College. And at a young age, she started taking my grandfather's average income, and learned how to invest it back then it was through a stockbroker into the markets. And I'll never forget, in my youth, I was 19 years of age, I had already started my first small business. And she said, David, would you rather have a check for a million dollars, or this penny doubled every day for $30 for 30 days. And with my infinite wisdom as a 19 year old, I said, Grandma, I'll take the million dollar check. So then she shows me this graph, which is actually in both of my books, because it's so powerful, no matter what stage in our financial lives we're in. And I saw that one penny becomes two and then four, and then eight cents. And by the time we're at day 12, we're at $86,000. And I'm like, you know, I made the right choice. And it's those last few days, where it goes from 100,000 to 200, to 400, to eight, to 1.6. And by the time you've doubled a penny, for 30 days, you have over $5 million,

Sam Yates:

because a lot of people don't realize that's exactly what happens when you double and double the double. So

David Rosell:

yeah, you know, I, Albert Einstein said, the eighth wonder of the world is that of compound interest. And I learned that from grandma, Ruth. And she said to me, David, if you ever want to be independent of the paycheck, you don't need to do anything extraordinary. You just need to do some ordinary things extraordinarily well. Rather than live on 100 or 110% of your paycheck, pay yourself first live on 90% of your paycheck. But if you do that, each and every paycheck, you're gonna get extraordinary results. Because that rule 72, the rule of 72, that's a great one, most people aren't familiar with that. And that's where you just take the average rate of return that you're getting. So let's say that your your home is growing at 7% a year or your Roth IRA is averaging 7% a year, you take that number seven and say how many times does that go into 72, which would be 10 times. And that means that if you're averaging 7%, every 10 years, your money's going to double. If you're averaging 12% 12% goes into 72, six times, every six years, your money will double. So it's a way that you could look like a mathematical genius. by just putting that quick formula right out there.

Sam Yates:

I want to jump back into your book failure is not an option. Because when I read the book, certainly, the financial information is there. The anecdotes are there, the adventure stories are there. And I know that you had several chapters. In particular, I went back and I highlight things, I do things the old fashioned way, and use my marker and highlighted some things that I was going to talk about most of them I probably have forgotten to bring into the conversation. But one of the things in particular was retirement risk. And I think you've covered that over multiple chapters. But I would like to ask Lieutenant Parker, to tell us about those risks. And Lieutenant before you tell us the risks, tell us about the lieutenant. It's one of my

David Rosell:

favorite stories. It's where I got five of my 15 minutes of fame. Hopefully I have 10 minutes left. But one of the things I realized I enjoy doing is traveling to countries before were, quote unquote, supposed to be on that, including Cuba. And in this case, it was Vietnam, and it was the early 1990s. And President Clinton hadn't opened up the trade embargo. So just by being there with us dollars you were trading in their eyes. So when I entered the country, I couldn't have been stamped my passport. And this was a time when there was virtually no tourism whatsoever. It was April 1974 When we pulled out of Saigon into the war, and really nothing much had been happening since and I landed in I was the only Westerner in sight. And serendipitously the South Koreans were forming or filming a documentary on the Vietnam War. And they said this is our opportunity. And they came running up to me so excited offered me 25 US dollars. dollars on the spot. And one of the most surreal things imaginable was an hour and a half later, I was in downtown Saigon, outside of the Rex hotel where Dan Rather and the other correspondents were always headquartered. And I was behind these ropes where there were 1000s of citizens watching this movie get filmed, and they didn't know whether I was a famous movie star or a famous general. But I was dressed up in this lieutenant's outfit. And Gary B. Turner was my name. And I was in this film. And I leave this into the financial lesson, because the next day I went to the bank. And back in those days, we traveled with traveler's checks, and I had $100 traveler's check. And that equated to 2.1 million Vietnamese Dong at the time. And the largest note they had was a 1000 notes. So I walked out with a paper bag filled with over 2000 notes going, What in the world am I going to do with all of this? Where am I going to put it? It's larger than my backpack, not conspicuous at all. Not conspicuous at all. So in the book, I had this picture of me throwing up cash in the air in my room going what in the world am I going to do, but it really brought back the impact of inflation. And inflation is something that's on the top of mind awareness for all of us listening to your podcast show today. Inflation that year was over 100% in Vietnam. But it reverts back to the law of averages in the United States. Yes, inflation is between eight and 9%. Yes, inflation was at 18%, in 1980. But it always reverts to the law of averages, any idea what inflation averages and most people don't know, but it averages between three and 4%. So back to your law of 72. Sam, if we take three and a half percent inflation, and, and put that into 72, mathematically, every 20 years, the cost of living doubles. So if we look at inflation in any single year, and something that's $100, this year, next year on average is going to be $103.50. No big deal. But if you're 40 years old, and you're talking to a financial advisor, and you say my goal is to live on, let's just use simple math $100,000 a year in today's dollars, and I want to retire at 60. We need to have enough money in that account on the top of the financial summit to take out $200,000 that year. Now you're 20 years in and we know how fast 20 years goes in. And you're 80 years young, where grain does mean playing because these days people are trading in their rocking chair for their stand up paddleboards and golf clubs. You now need to take out $400,000 To buy what $100,000 buys today. And the fastest growing portion of our population are centenarians, people turning 100 Hallmark greeting card sold 75,000 100 birthday cards last year. And that same person would need to take out $800,000 To buy what $100,000 bought when they were 40. And so the tougher we are in our self today, the easier life we'll be honest later.

Sam Yates:

I think those are some of the things that when someone reads your book, or they go onto your website, you know, they come away again, I find myself coming away from reading the book with aha moments. And another aha moments was with ETFs ETFs. Before I read the book, I really didn't pay too much attention to them exchange traded funds. Now, that little analogy you used in the book, and I see those new cars all over the place. Explain a little bit.

David Rosell:

Yeah, it's um, it is similar. As I mentioned, like, you might buy a new car and the day before you bought it, you'd see tons of them on the road, but you're you didn't pick up on it. And then all of a sudden you drive off the lot. And now all of a sudden you pick up on everyone else drive in that same car. And if you haven't heard of ETFs or not familiar with them, you're going to all of a sudden see them everywhere. ETFs we started working with them in 2003. And more money has been invested into ETFs in the last six, seven years than all the mutual funds combined. And I am here certainly not to put down owning individual securities, individual bonds, mutual funds, because I own them myself for many years. But the modern day invest thing from a tax mitigation perspective from a diversification in the cost of ownership. I am a firm believer that a portion of all of our portfolios could benefit by owning exchange traded funds, so I highly learn, highly recommend learning more about them and speaking to your financial advisors about them.

Sam Yates:

One of the topics that surprisingly comes up as I speak to attorneys working with seniors is cryptocurrency that is now coming more into the picture. How do you take a look at that and advise with cryptocurrency since it's seems to be so volatile lately?

David Rosell:

Yeah, it is volatile. Gold is a wonderful asset class to own too. And that's probably the most volatile of all the asset classes, it's been shown that if you put a small percentage of something more volatile into an overall portfolio, you have the potential to get higher returns and actually lower the risk because of diversification. With that being said, I'm all in favor of people having a small portion of their portfolio in a diversified asset class, like crypto, I don't think crypto is going anywhere, even though it's taking a big hit. A lot of people are looking for the new shiny object. And they're putting most if not all of their savings into that asset class. And that is a precarious thing to do. The thing is, is that we're working with people in the second half of their financial journey, they've already accumulated wealth. And I believe in that case, the return of their money takes precedence over the return on their money. There's no need to take their wealth and create multiples of it if they're already able to live the life that they've imagined. I know a lot of your listeners are golfers. But when you hit the top of the of the financial Summit, there are no Mulligan's. There are no second chances. So I'm going to say that one more time, Sam, when you're in the second half of the journey, the return of your money should take precedence over the return on it. But yet we need to outpace that magical word that we already discussed. Inflation.

Sam Yates:

We'll keep an eye on that, David before I go too much further because I'm watching the time to make sure we keep these within a prescribed limit that our listeners can listen to comfortably will you be able to come back at some point again, I want to twist your arm a little bit.

David Rosell:

Sam, it would be my honor

Sam Yates:

had to get the best way to contact David Roussel is

David Rosell:

David at Roselle wealth management.com And if you're out there listening, you're more than welcome to reach out to me directly here at the office. And that's 541-385-8831.

Sam Yates:

David, thank you for being here. And I look forward to having you back into future.

David Rosell:

Sam such a pleasure.

Sam Yates:

It's been my pleasure to share with you someone who has the knowledge of wealth so that new to all of you in our audience can go away with a bit of wealth of information. So that being said until our next episode of The Great American Senior Show, I'm your gray haired Host Sam Yates and that's the way our programming