July 19, 2020
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We all know that we are living in very uncertain times right now. We have a choice in dealing with what we can’t see ahead of us. In today’s episode, Suze walks us through how we can prepare.
July 19, 2020, Suze O. here and welcome to the Women and Money podcast as well as the men smart enough to listen. So are you going to join me tomorrow? You can join me on the app, the Women and Money app that you can download at Apple Apps or Google Play. Just search for Suze Orman because that is where I am going to start an eight-week program which is all about The Eight Qualities of Wealthy Women. And men, you are more than welcome to join us on this journey. And these are eight qualities that are essential that have got to be within your soul in order for you to be a truly wealthy woman. And there are many definitions of wealth, and one of my favorites is true wealth is that which can never diminish. So, I'm not just going to be talking about money here, I'm going to be talking about your whole being, your self worth as well as your net worth. And this is how we are going to take care of ourselves because Sarah and I were talking, and you should all know who Sarah is. She's my partner in crime here on the Women and Money podcast. She's the one who runs the app, she does all kinds of things to make everything go exactly as it should. And we were talking about how what we really think people need right now is self-care; we've got to care about ourselves. And I kind of realize, well, the best way to care about yourself is to have the qualities that will help you care about yourself, as well as eight qualities that are essential to becoming a wealthy woman because that's another way to care about yourself. So starting tomorrow on July 20, every Monday for eight consecutive weeks, I'm going to be talking about one of those qualities and then on your app and you're going to listen to this, by the way, on your app. This isn't a podcast, this isn't going to be on Instagram or on Facebook. This is only available on the app, the Women and Money app, and you'll listen to what I have to say and tell you about that quality. Then there will be a link that you will download right there where you're going to be able to do the exercise that I'm asking you to do. And then on Wednesdays, there will be a poll. And then on Friday, I will then address everything that you wrote in your notebook that you're going to access via the link. So join us because I think you're going to like it. Today's podcast, Don't Dwell in the Fear of the Unknown, is something that I want all of us really to think about, to understand, and to again incorporate into our soul. And the reason that I'm doing this podcast is that number one, you know, fear, in my opinion, is one of the main internal obstacles to wealth. And fear seems to be rampant again right now. We're afraid, are the schools going to open? If they open and we send our kids to the school, what's going to happen? Are kids going to get sick? Are the kids going to come back and make us sick? We are scared to death, we are so afraid if you have children, what are you going to do come September? We're also totally afraid, what are we going to do if we don't get our jobs back? What are we going to do in the future? Am I going to be able to retire, or am I not? So I just want to talk about the fear of the unknown. And how, on some level, can we help transfer the unknown to the known? So again, this came about because last week on CNBC, on July 16 to be exact, I was asked to answer a woman who is in her sixties. Her name is Glenda, who has been a great fan of mine for all these years. And she wrote in and she said, oh, this is my fear, can you help me? And they were doing a special that night, and CNBC thought it would be so great if I was the one who came on and answered her question and surprised her. So I was sent all of her information and I was reading it, and Glenda is 60 right now, and her wife, Juliana, is approximately 59. Both of them own a construction company in California and they were really upset because of this virus what's happened is that their construction business is down at least 50%, and they wanted to retire in 10 years at 70 and they just didn't think that they were going to be able to do that anymore. And Glenda wanted to know what could she do because she was upset about this? She was afraid of the future and what happened to her portfolio and all of these things. So, I'm sent all of this information, and I'm starting to look at everything and because Glenda has followed me for all these years, she had a 12-month emergency fund. Great. She owned her house outright. Great. She had $1 million in a retirement account. Great. And she was still able to save in her opinion, a $100k a year between the two of them towards their retirement, and her retirement goal was just $2 million. But yet she was so afraid that she wasn't going to meet that goal. And I did the numbers for her. I did it at a 2.5% return and a 5% return for 10 years if she couldn't contribute $100k, if she could only contribute $50k year, whatever it may be. And the end result was really no matter what happens, Glenda is going to at least meet her goal of $2 million in retirement at the end of 10 years and a 5% return, and according to her projection, she's going to have almost $3 million; she has absolutely nothing to worry about. And while I was talking to her on the TV the other day, she said, now I feel so much better, I just didn't know. It was the fear of the unknown that was upsetting her so much and all she needed to do to conquer that was to know. But the question then is, why didn't you just do the numbers? Why didn't she know? Because that was a really easy, truthfully, calculation to figure out with all the computers that are available right now on the internet. But it seemed to me that it's easier to just stay in this state of the unknown and to confuse ourselves into worrying ourselves and to dig in it, and rather than to take action to get yourself out. And then just yesterday, I got a call from one of my favorite reporters in the world from People.com and she said, Suze, the editor is just wondering what's on your mind? We're doing an article in September and he said, call Suze and see what's on her mind and what we should write about and what we should do. While an hour later, I finished dumping all of the thoughts in my mind out to her, and I was saying to her, you asked, you asked everything I was thinking about. But what was interesting about it, at least to me, is that everything just poured out about how one thing of the unknown triggers another thing of the unknown and how all these things are the unknown now. And then I went, but what good does it do you to know about the unknowns? You have to know what you're going to do about the unknown and henceforth the podcast today. So here's the thing. I think it's almost impossible for any of us to really predict what's going to happen in the future here, that is the unknown, truthfully. But what is it when it comes to jobs, what jobs will be there, what jobs won't be there? What is it that we can do that can take the unknown into the realm of the known? And I realized that we almost have to go back to the good old days where they had universities, like the vocational schools and schools that taught a trade because one thing that I do know is that artificial intelligence and robotics are going to replace many, many, many, many of the jobs that right now are done by people. That I know. When that happens, I don't know, but I also know that there are many jobs out there that will never, ever be able to be replaced such as a plumber, an electrician, a carpenter, a dry-waller, a painter, and so on. So, if I had to redo my life, I really needed to make money, and I had to redo my life, and I knew that my job probably wasn't going to come back, what was I going to do and everything? Rather than dwelling in the fear of the unknown, I would take a pivot. I would turn and I would start to learn a trade. I'm very serious, everybody. I would start to learn a trade of what is known to be able to make me money. The other day, I got a call from somebody at my apartment in Florida and they said, Suze, your dishwasher is broken, so I needed to have it fixed. So, I called the person that I always call. While I could have ordered the dishwasher online, I never could have installed it. So I called him, he installed it, and then while he was there, I asked him to do three or four other things. And here we go, now he's made money and I was able to take care of a problem I had. No way could I have taken care of that problem with artificial intelligence or robotics. And then I started to think back to 2008 where many of the people that were losing their jobs, they had professional jobs, they were in all kinds of things real estate, everything. And they went from making $150k a year, $200k a year, down to really not making anything. And so they lost their jobs, their corporations downsized, whatever it was, and a lot of them ended up being drivers. And I started to notice that as I went all over the United States back then because I was traveling a lot, that I would always talk to my driver because I'm so interested in what did they do, do they love driving, the interesting people that they meet? And almost every one of them, back then, they were telling me stories about how they were an engineer, they were this, they were that. They lost their job, and now they're driving. And I asked them, do you like it? And they go, actually, I'm having a great time driving, Suze. And as the years went on, because once I go somewhere and I like a driver, I always keep his or her card, and I always call for them again. And so 2008 turned into 2010, turned into 2012, and 15, and 17, and I would call them every time I would go to that city and they were still driving. And I said, how come you never went back to your other jobs? And they said, well, it turns out I really love this, who knew I would love this so much? And I making more as a driver than I was working for somebody else, and I get to sit in the car and I get to be on my computer while people are doing whatever and I get to dictate when I want to drive when I don't want to drive. And even though I know Uber has come around and it seems like it would hurt the occupation of many drivers, which I'm sure it has, many of them it hasn't hurt them at all. And many of them have transformed what they are doing by also now becoming shoppers because there are a lot of people that don't want to go into stores. So my particular driver in Florida does all the shopping for me now, and he's the one who goes into the stores. He's the one who gets everything that we want and takes it and gets it to us here. And even when we were there just a few weeks ago, he did all the shopping and dropped it at the house because I don't want, and I don't want KT because we're high-risk, to go into a store right now in Florida. Florida is rampant with COVID. So he's now added to his income by not just driving, but by now being a shopper to people. So he's turned the unknown into the known. So I tell you this because I just want you all to be open-minded. I don't want you to think I have to stick to doing the job that I went to school to do. This is what I trained for, this is what I need to do. Maybe so, but that may be something that is in an area of an unknown. So what can you do in the meantime? Doesn't have to be forever but it may turn out to be forever. What can you do where you can turn an unknown into a known? When we talk then about the unknown of the stock market and what is the stock market going to do? Is it going to go up or is it going to go down, which causes tremendous fear in so many of you out there? Is real estate going to go up, is real estate going to go down? Who knows? But what actions can you take to turn an unknown into a known? And I just want to give you an example of my niece, Katie, who I love so very much. And a little bit ago, Katie, who now has two children, Tommy J. and Will, they call him Will Will. They've almost outgrown their home. They have a little home and they love this little home, and it's perfect for them. But now Taylor, who is Katie's husband, has gone back to school, and he's going to become a social worker, and he needs to study. And they have two kids at home and Katie is a vet. Because if you're pets ever get to the point of life where they're no longer meant to be in this world, Dr. Katie in Jacksonville, Florida, oh my God, I have to tell you, everybody, look her up. You can find her at www.DrKatieHospiceVet.com. She has a waiting list of people who's animals now really need to go on, and they all want to be with her because Katie has to be one of the most incredible people in life, but that's beside the point. I'm off track. I will now get back on track from the known versus the unknown. And Katie, a few weeks ago, called me and we have this long discussion, could she afford to buy a new home because they were outgrowing it, and was it a wise thing to do right now? And I always believe, well, if it's a good time to sell its not a good time to buy, and if it's a good time to buy, it's not really a good time to sell. So I said, Katie, why don't you sell right now and move into an apartment? Well, that did not go over very well because it was like, no, Suze, I don't want to have to move everything, it's just such a hassle to move everything. I have two kids, it's just I'm going all the time, you know, I have everybody to take care of, I just can't do that. But what Katie decided to do because she didn't know what her future held for herself that was unknown to her. Would she be able to continue to see clients? What would go on here with Florida and everything, and that was stressing her out. What they did instead is they rented a little apartment across the street from where they currently live. Where Taylor can go and study and be quiet, where Lynn and Tom, her mom and father, can come and stay, and rather than renting an Airbnb, they're now going to be living in the apartment. And now Katie is so happy because she's turned the unknown into a known. She knows what the rent is in this little apartment, she gets to stay in her house that she loved so very much, and now she is calm again, and now everything is going in her life the way that it should be going. So Katie took the actions to turn an unknown of what should I do, should I sell, should I not, into a known, which is she wants to stay in her house and she figured out how to do it? So for many of you out there right now, what can you do? Really, everybody, I'm very serious about this. What can you do to turn an unknown into a known? Let's talk about the stock market. So many of you are afraid because you don't know is the market going to go up? Is the market going to go down? Are you going to need this money? Should you sell, should you not sell? And I told you this before, there's always a question that you should ask yourself if you have $10k in stock and rather than having it in stock, if you had it in cash, would you buy that stock again right here and right now? If the answer to that is no, sell. If the answer to that is, I don't know, sell half. But do something to alleviate your fear. I myself had a tremendous amount of money in Amazon, and for me, I watched Amazon go in less than a month from $2400 a share, $3400 a share, and I have to tell you, it scared me. I didn't like it because that was just too crazy for me. A stock shouldn't go up that fast. So for me, I sold it. I sold my favorite stock in the world, which I do not mind telling you, which is Amazon. And then I was like, OK, if it goes higher, no problem, I made my money, but I was afraid because it was like unknown territory for me, intellectually speaking, when it came to looking at that stock. And today, here we are and it's now back down at $2900. And now, I'm starting to nibble on it again and going OK, I'm willing to buy it again because I feel comfortable with it around this area, even though I think it's absolutely possible that it could go down to $2200, $2500, whatever it may be. But I'm not buying it all at once. I bought a little here, I might buy a little bit more if it goes down, maybe I'll buy a little more if it goes up gradually. But now I've converted an unknown where I didn't feel comfortable to a known where I feel like I'm in control. So what's really important is that you make those decisions as well for yourself. But once you have made a decision with stocks, either you sold it or you bought it, you have to really watch it. Now, obviously, if you have at least 10 years or longer, I would not be afraid here. Would I be investing all at once? I told you, no, I would nibble little by little on the things that you like or better yet, the Vanguard Total Stock Market Index Fund. Because I think going out 10 years it's pretty much a known that everything will be OK. I just want to comment a little bit more on interest rates, known versus unknown. So many of you were so afraid because you really thought that you were going to miss the bottom of the interest rate environment. So you refinanced your home where you bought a home because you wanted to lock in, you know, 3.5% or 3.2% on a 30-year mortgage. And now, for the first time in history, a 30-year mortgage is under 3% which puts a 15-year mortgage at like about 2.5%, 2.25%, which is so low I can't even tell you. Then you write to me and you go, if only I had known it was going to go lower, I wish I had waited. No, don't be like that. You felt like it was a good idea, you did it, now you know what your interest rate is. Be happy with that, don't have regrets. But for those of you who are still wondering, will it go lower, I don't know what to do? These are fabulous interest rates right now. If you want to refinance and it makes sense for you to refinance, turn an unknown into a known and just do it. So bottom line, what I'm saying here to all of you is this. The way that you turn an unknown into a known is by taking some action. If you're afraid because you don't know how long your money is going to last, turn the unknown of how long is it going to last and figure it out? Figure out ways that you can cut back, figure out other things that you can do to make money, but you have got to take action because we have entered the realm of the unknown. And the only way not to dwell in the fear of the unknown is to take action and turn those unknowns into known. There's a way you can do it, there has to be a way you can do it, but you cannot give up. Got that, everybody? All right, join me tomorrow on the Women and Money app, and let's start this eight-week program and dive into The Eight Qualities of a Wealthy Woman. See you there.
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