Being an immigrant has its own challenges and I was curious to know from other immigrants how they were dealing with their finances. I wanted to find out the unique challenges they were facing and how they dealt with them. This interview series is an attempt to share the stories of immigrants and how they manage their finances.
I am very happy to present our second guest for the interview series, Rocky Lalvani from Richer Soul. He teaches financial planning and growing your wealth and help you avoid the mistakes he made during his journey to build wealth.
I hope you enjoy this interview as much as I did.
1. Can you tell us about yourself? Please include any details you feel comfortable sharing about how long you’ve been in the US, what you do for a living and your income range.
I came to the USA when I was 2 years old. It was 1968 and it was my parents 2nd big move in life. They had to relocate during WW2 as India split apart. I grew up in the USA but all our family friends were other Indians that my parents knew from back home. My wife came to the US when she was 16 from India as well. My parents were older when they had me and were only allowed to bring $25 from India. They each had a sibling in the US to help them get started.
Both my wife and I paid our way through college and started working. We both make 6 figure incomes and I have always saved and been frugal with my spending. We have 2 kids 19 and 16. My daughter is off to college and my son is home schooling for high school but taking college classes instead of high school classes. He should graduate high school with 60 credits. We did this because the cost of college is ridiculous and we don’t see much value beyond the piece of paper.
I live in PA.
2. What was your relationship with money during the early days of your life? How did it influence your finances?
In the early days, money was tight. My mom passed away when I was 7. My dad never remarried. Also because his education in pharmacy did not transfer over he worked in an office job which didn’t pay a lot. We did not have fancy things but we always had what was needed and we traveled the world. When I graduated, I had the goal of becoming a millionaire and I automated my savings to ensure it would happen. I would constantly plot out returns and growth expectations. I chased the American dream of the big house and fancy car. I then learned that it wasn’t all that and all the stuff didn’t make me happy. So I started to downsize.
3. Do you discuss money with your friends, family or colleagues? How do they react when you bring up the topic of money? Is this a taboo subject?
When I was growing up our parents and friends always talked about money. They talked about earning, spending and what things costs. It was an open discussion and I got to watch as everyone climbed the economic ladder in a relatively short period of time. I don’t talk about money with friends because in the US money is more taboo. However, I do talk a lot about it online and with people who are interested. It’s funny watching co-workers make comments about your lifestyle and choices. There is a lot of envy and a lot of people overspend.
4. What are some of the money mistakes you have committed? What lessons did you learn from it?
In the early days, I chased returns in the stock market always being behind the growth. I thought I could beat the market or find great stocks. Miserable failure! In 2000 I knew the stock market was crazy and I sold out a lot of my stocks. I was able to buy back in at the bottom in 2003 and from there to 2008 my wealth grew dramatically. I didn’t expect 2008 and panicked and literally sold at the bottom a large portion of my stocks. In spite of that continued buying of more and slowly getting back into the market, I was able to recover. I feel like we are in a similar place today and have moved to a very safe position in my holdings anticipating another downturn.
Over committing to monthly charges. Early on I did this and once it cramped my style, I got very serious about never having monthly charges. Even small charges add up quickly to a major amount of your spending.
5. What is your view on debt? Do you carry any form of debt? Has it ever been a source of stress in your life?
In my early years, I did get into a little debt and also monthly obligations and I saw it was really cramping my lifestyle. I did my best to quickly get out of it. We again went into some debt when I got married and we quickly paid it off. I don’t like borrowing but with rates so cheap it does make sense however I keep it in balance and low. We paid off the house as fast as we could. My only debt is on real estate rental properties but they are 10-15 year terms. I don’t like long term debt. Since it’s always been so low it doesn’t cause much stress. It was scary though when we bought the house we now live in 1999. It seemed like such a large payment and we always worry about losing a job.
6. How is your money invested? Does being an immigrant have any influence on your investment decisions?
We are invested in stocks, bonds, and real estate. Being an immigrant doesn’t influence the decision but it does influence the savings rates. We have both tax-advantaged and regular brokerage accounts.
The money is spread among retirement accounts and brokerage accounts invested primarily in mutual funds. In the past, I bought individual stocks but I rarely do now because I don’t have the time to do the proper research. Also, stocks seem to be more about investor sentiment rather than underlying fundamentals. With the amount of money being spent researching stocks it’s hard for me to get a competitive advantage without spending a lot of time. Looking at historical returns the smartest move would have been to invest in an S&P 500 index fund and forget about it. Emotions end up playing a big part in decisions and they should not. Because of income, I am limited in the type of retirement accounts I have access to. I am working on using the mega-back door Roth conversion this year.
Since the market is currently so high and we have not had a pullback. I am in a defensive position waiting for an opportunity to buy at a big discount. I have noticed the biggest returns come when the market tanks and I invest.
I also own rentals and I flip houses. I am scaling back on my rental houses because some of my properties are not best suited for good returns as local market conditions have changed.
7. Do you have any specific money situation as an immigrant (e.g. supporting an aging parent or family overseas) that influences your finances?
My wife’s mother moved in with us 5 years after we got married. She helped us raise our kids and we took care of her finances and health care while she was alive. We fully supported her. My wife’s dad had passed away a few years before we were married and her mother did not have much money and no income.
8. Are you aware of the FI or FIRE movement? If yes, where did you hear about it? Are you pursuing (or have you reached) financial independence?
Absolutely – I used to listen to Bob Brinker in the ’90s and he has something called critical mass. He basically said that if you had 2,000,000 you had critical mass and could do anything you wanted and live off that money for the rest of your life. That was my goal and I achieved it years ago. We both still work because inflation kicked in and we want to live FAT FIRE. I also don’t think retirement is all that. You need a sense of purpose and growth. Work provides that and we are quickly moving to change the way work to just doing what we want.
9. What are some of the apps or tools you use to manage your finances?
I have used Quicken since the early ’90s. I can look at all my spending and savings in the program. I have been downloading and entering transactions my entire life into the software. It provides me the ability to see how things have changed and how my money has grown.
10. Are there any specific books, blogs or podcasts on personal finance that you’d recommend to others?
- Blogs: Get Rich Slowly, Retirement Manifesto, Financial Mentor
- Podcasts: Choose FI, Retirement Answer Man
- Books: The Richest Man in Babylon
11. What money advice do you have for new immigrants who arrive in the US?
Understand the rules of the American system. Decide if you are going back home because it changes how you do things. Understand social security and how it will support you in retirement. The “experts” are not experts they are salespeople. Most people live for vanity and they really are not wealthy. Don’t get caught in that trap. Also, your money stories and values are different than American values.
You have to understand each to see what makes sense. The beliefs you have may not apply in the USA. It takes a lot of time to learn how all the different accounts, Roth, 401k, IRA, 529, etc work. It’s a lot less complicated than you think. Finding the right person to truly help you is hard. Most people don’t know what they think they do.
12. How can people connect with you on social media?
Are you a first-generation immigrant in the US? If yes, would you like to be part of this interview series? This series will focus on personal finance for first-generation immigrants and the unique challenges they face.
You can check out my page Immigrant Finances – Interview Series for more details on how to participate in this series.