Podcast Episode - Suze School: Are You In Financial Panic Mode?

With just days left in the holiday gift giving season, are you staying financially strong, or are you going into panic mode and buying gifts that maybe your family and friends don’t really need?  Suze explains why you need to stick to your financial goals all year and that lasting and memorable gifts may not be the ones you purchase with money.

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Podcast Transcript:

December 15th, 2024. Welcome everybody to the Women and Money podcast as well as everybody smart enough to listen.

December 15th. What does that mean? It means that many of you. Now, if you haven't already gotten the gifts that you wanna give for the holiday season, the day that the gifts are given 10 days from now, you are now in financial panic mode. Maybe just maybe you thought, no, I'm not gonna give gifts this year. I'm gonna make things. I'm just gonna tell people how much I love them. And now these are the 10 days that financial guilt comes in.

You start to look at everybody celebrating and the parties and the gifts giving and all these things that are going on within your office or wherever you may work or whatever it is, you look at TV. And now everybody is walking down the streets and caroling and all these things and everybody's celebrating and now you are in to the holiday spirit.

And it is within that spirit that even though you were being financially strong, in most cases, up till this point, it is that this day, 10 days before "G-Day," I call it "G-Day" because it's the gift giving day, you all start to get weak and you give in, you go into a store, you're looking at things and you decide, ok, I'll just get this and the person behind the counter says, you know, anything you buy today, you will get 20% off. If you simply apply for a credit card and you go really, I can save that much money. You only went in there to spend maybe $50 but you like 20% off everything I buy.

And then what do you do?

You go to all the other departments and you think about what you want, not what you need, but what you want, what others may want. And before you know it, you walk out with typically by the way around $600 or $700 worth of items that in your head, you just saved $120 on and that's what you do. And then you leave.

Now you're feeling really, really good that you saved all of this money, you give the gifts, ok? You have a great holiday, I hope and then comes January and the bill comes in and if it's at a department store, you see that the interest is at around 28%. And now what do you do? You only pay the minimum payment due and you think? Oh, that's all right. I can just take care of this over time. Let's just put a pin in that for one second.

Now, I want to go to a Suze story.

I'll never forget when I was doing the Oprah Winfrey show. And Oprah would have me go into people's homes and my job was to figure out what they had going on, how to get them out of debt, how to make sure that they were on the correct financial path.

And there was not one home, not one home that I went into that when I was going through their closets in their closets were all this stuff. And I know I've said this before, but I'm gonna say it again. All this stuff in the back of the closet, just stuff there.

And I would say let's bring everything out so we can see what you have. Everything that came out of that closet, that top shelf were gifts given to them for the holiday season that they didn't like, but they didn't have the courage to return.

And I would say, why did you keep it? Well, I didn't want to hurt the person's feelings, Suze. They gave it to me with such love. I said, but you didn't even like what they gave you. You wasted their money by taking this gift under the false pretense that you loved it. You opened it up, you said, oh my God, thank you so much. And you give them a hug and then they leave and then you look at it and go.

I wish I could return this. And then that little voice would come in and say I can't return this. It will hurt their feelings in the closet. It goes and it stays there for the next 20 years.

You know, and I know that is true. That happens to me and KT every single holiday season, we tell everybody there is not anything that we want. There is not anything that we need. So we beg you, please don't send gifts, please don't give us gifts. But do you think anybody listens to us? No, undoubtedly when we go back to Florida, there are gifts and I already know because we were just there, there are gifts that people have sent and we open them up and we go, we don't want this.

We don't need this. And the truth of the matter is we don't even like it. Now, here we are with these gifts and what do we do with them? We return them and we let the person know who sent us those gifts that we are returning them and the credit will be back on their account. But now we have to take this gift, take it back, figure out how to return it.

It's a mess. So I want you to just think about this because I know what we experience is something that every single one of you experiences.

And I find that all so sad. You know, when I was a financial advisor, actually seeing clients and we would work so hard, I worked so hard with them to get them out of credit card debt to make sure that they were on the right path all year long. We would do that and then came December.

I would always call December the month of doom. Financial doom, because why? It is in the month of December that all the work that is being done to save money to get out of debt, we're doomed. It comes right back all in this month, especially during the last 10 days before "G-Day", gift day because it is in these days that you freak, you give in to temptation, you go into a store and you just buy anything that they've placed where they know you will see it, you will want it, you buy it and you leave.

So I just want to give you a few numbers of what that gift if I am speaking to you, what that gift probably will cost you.

If in fact, all you did was you went in and when it was all said and done, let's just say you spent $1000 not that hard to day at $100 a crack. That's 10 people. Not that hard or even $50. That's 20 people. It is very possible that you are now charging $1000 on credit cards for gifts. Do you know if you went in to a department store, you took advantage of that 20% off. And now your bill really is $1000. Do you know that if all you ever do is pay the minimum payment due, it is going to take you nine years and six months to pay that off.

You also will have paid $1931 in interest.

So you now have shelled out almost $3000 for probably a gift that may or may not be sitting in somebody's closet. Do you know that the average credit card debt today in the United States of America is $6329 and an average interest rate of 23.37% with the minimum payment due. Usually in both of these cases, by the way that I just cited is 2%.

Do you know that if you continue to only pay the minimum payment due, it's going to take the majority of people out there 21 years and three months to pay that off and $12,809 in interest.

So $6329 over all those years, 21 years, you have shelled out 18 or $19,000.

I just want you to think about that for a second. Now, I know this might not be very holiday, spirit wise of Suze Orman, but it is sure financial wise of Suze Orman.

The gift giving season really is one of true generosity. You take out your Suze notebooks and you write this down. Now. True generosity and generosity is not just giving somebody a gift.

True generosity is when you give somebody a gift, but it's also a gift for yourself as well. And what that means is that you are able to buy that gift with cash and you're able to buy that gift with cash because you have an 8 to 12 month emergency fund. You have absolutely no credit card debt whatsoever. You are fully funding your retirement accounts, your car is owned outright. You are living a debt free life. You have money in excess of what I just said. And all right, you can buy people gifts and it's not gonna put any hardship on you whatsoever. If however, you are buying somebody a gift and you have got to put that gift on your credit card where you already have debt that you carry every single month.

You are not being generous to yourself.

You are financially sabotaging your future. Remember, credit card debt is where you pay for your present day desires, your desire to look generous, your desire to have a new iphone, your desire to have these things that you want, not need that you want. But the true cost of that everybody is your future day needs when you get older and you need money.

The true gift that not only can you give yourself but to others is the gift of standing in your truth to be able to say to somebody.

I want you to know I would love to give you a gift. I would love to buy this and that for you. But I don't have the money to do so.

So what is it that I could do for you that doesn't cost money? They could simply show you how much I love you. Especially during this holiday season. Chances are if you were to say that to somebody, you know what they're gonna say back to you. Oh, thank God because I'm in the exact same situation and I've always given you a gift because you've given me a gift and I've always had to put it on my credit card.

Let's just be with each other. Let's just maybe have a dinner at home together.

Let's just stand in our truth in this holiday season and not give a gift, not give a gift of something but give a gift of each other to each other.

And now I know this is very difficult to do when it comes to children.

But if you think you're giving them a gift that you can't afford and it goes on your credit card.

I'm just asking you, what do you think you're teaching them? How do you think that they're gonna grow up and what they're gonna end up doing if they're in that same situation you might want to say to them sweethearts on this holiday.

Let's go and give time to others that are less fortunate. Let's go and volunteer. Let's go and do this. Let's go and do that.

There's nothing wrong with that. Now, I know it's not easy. I know you can't stand watching your little kids go. But mom but mom, dad, dad, whatever it may be.

But I want you to just think about that.

You know, last week you heard that Barb, KT's sister was on the podcast and after that podcast was over, she went and she said, oh, Suze, I should have told them this, I should have told them that I should have done this or that. And I was like, but Barb, you did great. That was a great podcast. And I said, Barb, what was the greatest gift during all those years?

And essentially what Barb said was the gift is what I'm seeing right now, Suze. And my children who make gifts, who don't get into debt, who all have savings, responsible jobs, refuse to spend money on wants and put it away for needs. That's the greatest gift I could have ever been given. Because to me, Suze, really, there's nothing more important than my children and I see what has happened by standing in our truth and not being able to do certain things.

And I said, Barb, how did that gift come about? And she said, well, it wasn't easy. It took time. But after you telling us over and over again about needs versus wants all the gifts we were buying for the kids stopped because they started to understand the true meaning of the holidays and the true meaning of money and the true purpose of money, which is to be secure.

So can you just imagine a 13 year old saying, when asked, what is the goal of money? And they say it's to be secure, don't you think that would be the greatest gift you could give your family?

Yesterday morning, Colo was in the bedroom with us having our coffee. We like for some reason, they have coffee in our bedroom. And I said, Colo, if I was going to do a podcast tomorrow on, what is the greatest gift you could give somebody? Do you know what Klo said to me? He said, Suze, tell them the greatest gift is the gift of saving the gift of saving.

He said, there's nothing that makes me feel better when I know now not to be giving my kids gifts of all these things that they want. But to say, guess what? I just put $100 in a savings account for you and what that does for them.

But even Colo, Colo after all these years, finally has said, the greatest gift you can give your children is the gift of savings.

Just something for all of you to think about.

The other day, I got an email from a friend of mine by the name of Allison. And she says to me, Suze, my son came up to me and said, I want to start making money. So I want to invest in the stock market.

And Allison says, but Suze, I have no idea how to do that. I said, ok, there's two ways to do it but how much money do you think he has to invest? She said, just a few $100. I said, so therefore you can buy one exchange traded fund such as VOO VOO, VTI, any of those - Spiders SPY and just keep doing that with little amounts of money as time goes on or you can teach him a lesson that you don't invest in the stock market and just think that everything is going to just go up maybe one of the greatest lessons at this point in his life. He's still very young about 10. This point in his life is to understand that you just don't invest in the market thinking that you want to make money.

You invest in the stock market because you want to see your money grow over time.

But that you have to know with growth over time also comes the possibility of losing money as well.

So if I were you and I then gave her a list of stocks, I would invest $20 in each one of these stocks and then I would save any extra besides that. And I would teach him when these stocks go down, you put more money in, you put another $5 in or $10 in and you just keep doing that over time and every time he gets extra money, especially for the gift giving season that is coming up, give him cash, but that cash has got to go into a money market account waiting to be invested in these stocks.

And now that is what they are going to do.

But is that something all of you can do for your children as well? Teach them investing and what it's like to make your money grow, but also teach them the risk that investments can go down as well, which brings us to our last topic of this Suze School.

Now, if you remember quite a while ago, I started to say to many of you that heard that if you own Devon, especially if it is outside of a retirement account, sell it, I would sell it and I would then take that money and put it into either Pfizer or Whirlpool at that time.

That's it. Take the loss also. Now, even in a retirement account, I would probably do the same as well.

During the years that we've owned, Devon, we have gotten a nice dividend. So you need to figure out truly, how much did you lose on that one investment? Did you lose it all? Just depends on when you bought it and if you continued to dollar cost average into it, little by little, if you had truthfully, you wouldn't be down quite so much, believe it or not.

But Devon is a stock that is absolutely underperformed to my surprise to what's going on all oil stocks right now, energy stocks are not doing great. But I do think if you invested in that stock and you did so mainly for the dividend, then Pfizer, even though I know you think Pfizer is never gonna go up, it's now paying a dividend in the 6% area. I still have faith in Pfizer. I still own Pfizer. And that's probably if you're looking for income with a stock that could continue to grow as well as possibly go down. Pfizer might be a stock that you switch into from Devon symbol DVN.

We will buy stocks that absolutely skyrocket on us and we will buy stocks that absolutely go down and may never go back up again.

But that is why you have diversification within certain areas. It doesn't have to be equal diversification by any means. But that is the risk one takes. But I still think if you bought most of the stocks or ETF S that were recommended and not just Devon, maybe you bought XLE and you stayed in that and now you're up tremendously on that and you had diversification in that ETF but if you look at most of the recommendations truthfully, you have done very, very well. Let me just talk about Palantir because you're all writing about that. What would Suze do? Da Da, da Suze is keeping Palantir.

Suze, actually, as it went down to 71 the other day after it hit 80. Suze bought more, I like that stock. I'm going to continue to like that stock. It is not the only stock that I own. I own probably 50 stocks maybe even more than that at this point in time.

Well, actually, I absolutely do own f more than 50 stocks at this point in time. Other kinds of investments. My money is spread across the board in gold in IBI, in Bitcoin, in all of those things along with bonds, municipal bonds, treasury bonds series, I bonds that I've had for a while that I just wanna keep for some reason. Um and it, it spread everywhere so that no matter what happens on some level somewhere, my money is averaging and doing just great for me.

So, bottom line, I'm saying it now and you can do whatever you want. I'm sticking with Palantir. However, what is the goal of money? The goal of money is for you to be secure. And listen, if it's making you nervous and you've tripled your money, you've done whatever with it and you want to sell, sell, you can do that. Nobody is saying you have to stay in.

So if you need money, if you're in debt, you invested in it, you're just nervous and losing sleep over it and watching it every single day, there's nothing wrong with selling some of it, selling all of it or selling none of it. It just depends on how you feel about it. And if it's making you feel insecure and nervous, just sell overall, I think the markets are going to be doing very well for next year, especially if you're invested in certain areas. That doesn't mean that it's not gonna come down significantly at times. But when it does, that's when you take advantage of stocks that you wanna hold for 5, 10, 15 years and you just keep them in dollar cost average into them.

I am asking all of you to be extremely patient with the program that Keith Fitzgerald is coming out with. Stop writing me saying when is it gonna happen? When is it gonna happen? It's gonna happen when it is supposed to happen and either you wanna wait for it or you don't.

But all things that are really great are worth waiting for. I myself have truly no idea when it will really come out. Keith keeps saying they're in the final stages they're doing this. They're doing that. I'll believe it when I see it. But I wanna give Keith enough latitude and development room until he feels great about it. Not because all of you are impatient and you want it. Now, don't be like that everybody.

You need to be a patient investor. You need to be an understanding investor of how you feel about your own investments. You need to be a generous person. When you know, when you're being generous to others as well as yourself. You need to be a true teacher of your children and future generations and get them to understand what the goal of money is. But you yourself have to understand what it is. So what actions do you take today to make yourself feel secure? You need to be a person that has the ability and the courage to stand in the truth and tell people if they've given you something that you don't like what you're gonna do with it and how you're gonna return it or whatever it may be. You need to be integrous and really courageous and really have the ability to understand that people love you for who you are not for what you give them.

So that brings us to the end of this Suze School. Thursday will be another Ask KT and Suze Anything. But until then, can you just think about these next 10 days and what you are or not going to do with all that time. See you Thursday everybody.

There's really only one thing that I want you to remember when it comes to your money and it is this people first. That means you, you, you, you not others, not others that you can give a gift to, but giving a true gift of financial security to yourself people first, then money, then things. And if you do that you will be unstoppable.