April 09, 2020
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In this podcast of Ask Suze Anything, we hear questions and comments from Women & Money listeners Kent, Karen, Harriet, Jo, Anonymous, Julie, Lauren, and Michelle.
Welcome everyone to another edition of Ask Suze Anything. This is where you write in to AskSuzePodcast@gmail.com and if your questions are selected, I will answer them on this podcast. Now, I don't know what happened. I have to tell you, I absolutely don't know what happened, but over the past three weeks, month or so, the emails have skyrocketed to thousands and thousands and thousands, as well as the listeners to this podcast. We now have had millions and millions of downloads. So, I'm so grateful to all of you, but that does make it a little bit harder for me to answer all of your emails. So I can try, but I doubt highly that I'll be able to so don't get mad at me, just know. Also, I did happen to look at the final version of the Women and Money community app that you'll be able to get very shortly here, and it's going to be so great, you're going to love it. Because, through this app, you're going to be able to search past podcasts for topics that you really want to know about. You're going to be able to see many of the questions and the answers that I have given personally to those questions. One of my favorite things is Suze Live. So when I want to stream to all of you in video, I'm just going to go on and you'll get notified and I'll be on there talking to you visually about what I really want to say to you. And then, there are all other kinds of things there, but I'm excited about that. Also, just a few more announcements before I start. I will be on HSN again this Saturday night at 7 p.m., so that is April 11th at 7 p.m. East Coast time, and you can adjust that according to wherever your time zone happens to be. And all of you are calling in and asking questions, and I'm answering them on the air, so you don't have to call or you don't have to do it just to buy something, that's not what this is about. But if you want to talk to me, you can try again. There were thousands of calls and we didn't get too many this last time, but, hey, we're going to try it again. Also, you'll get to see what my home looks like. I decided to broadcast in front of a blue screen that KT just painted for me because the sun's too bright and it's just blowing everything out. But again, that's just beside the point. All right, let me briefly address the markets for you here. Are you all feeling better? You should be feeling better. Do you know that the Dow Jones industrial average, the one that most of you know about, that index, do you know that it's up almost really 30% from its low? Do you know the NASDAQ index is only down 10% from its high? So, a lot of you have seen many of the dramatic losses that were occurring in your accounts. You've seen them come up quite dramatically not to where they were by any chance, were still down 22% on the Dow. But they have started to come back. Do I personally think that it's straight up from here? No way, I don't. But do I hope that I'm 100% wrong? Of course, I do. But I do think that we're going to be seeing markets that go up, markets that go down, all over the place, and eventually, we will go back down again and test the lows. And that's probably when I think that will be that. I do think that you have to be very careful here and dollar-cost averaging currently is the best way to go where you invest every single month, month in and month out. There will be a time, and maybe that's the next bottom of the stock market, that you might want to consider if you have a larger lump sum of money to go in at that time. We obviously are feeling better. All of you need to remember that the stock market is like this emotional roller coaster. When you feel good, you invest, when you're afraid and you feel bad, you sell. It's really just that simple. So, it's almost as if it's like a thermometer, an emotional thermometer of how all of you are feeling and all of you, obviously, are feeling better because the markets are going up. And so that's what's happening right now. But anything can trigger it to make you not feel so good again, and then the markets will go down. I personally think, and I've told you I've always thought this, that the health crisis that we're going through in the world is what's triggering people's fear. Are all of you feeling like, oh, you're staying at home? You're feeling safer and that we're closer to the end of this than we were when it first started? Probably, you should be, because I do think for many states, we're getting into it and we're almost through it, in terms of the apex, as so many people call it. And that new cases are starting to go down slightly, deaths, obviously, are still increasing because the deaths lag the admissions into the hospital, as you all know, by about two and a half weeks. But there's this sense that there is light at the end of this tunnel.I was talking to Colombia, all of you may know Colo from past podcasts. He was saying, Suze, how long do you think that you're going to be here? Because you know, Colo isn't used to KT and me being here all the time. We come for a week and then we leave for me to go give a talk or do TV or whatever it is that I do out there. And we've been with him now for a month and a half on this island and he said, how long do you think you guys are going to stay? And I'd like to think that he wanted to know because he was really loving being with us and having dinner with us every night. And yes, yes, I know you're thinking, Suze, aren't you supposed to be keeping social distance? We do! I also need to tell you that we were all tested yesterday for the virus, just in case to make sure. Um, mainly because we live on a very small island, and if one person gets it here, we are all in serious trouble, because there's no way to treat it here on any level. So we were all tested and, you know, we've been here now for a month and a half like I said, and all of us, thank God, are healthy and we do not leave our house. So, I can't imagine how we would have gotten it. But yes, we all have dinner together. So, back to the story, however, and I'm sitting there thinking, oh, I hope it's because you like us here, right, Colo? And that was the case, he said, I really like it that you guys are here so much, this is fabulous because I get lonely sometimes without you. So that was good. And then I said to him, I don't think I'm going anywhere until September. And he said, what? And then I doubted his answer to me, but I still believe him. And I said, yeah, I think I'm going to stay put right here until September. And the reason everybody that I chose September is that I think absolutely, I think the news will start to get better really around April 22nd for really the hard-hit places, and then around June, it will start to be coming to an end. But I do think it will be until at least September until things feel relatively normal. And you know, because I am high risk, you know I don't have good lungs, I don't mind sharing that with you. I'm going to turn 69 in June so I'm all these things that I shouldn't be, I just really, I don't want to chance it, and all the money in the world can't tempt me to do so. So, um, I think I'm just going to be right here. All right? Should we go and answer some questions from Kent? Now, I'm going to do two questions at once. One is from Kent, and one is from Karen, and I chose them because their names both started with "K." That doesn't seem like a very good reason, but it was a good reason for me. Here is the reason that I've chosen both of these. Kent says, Suze, I really need clarification. I have a Federal Perkins Loan, and I really need to know is my loan eligible for payment pause? I was told that it was because it's a federal loan and all federal student loans do not have to be paid, they can be postponed until September 30th. We can put the payments on pause, that's what, obviously, he was told, until September 30, 2020. So, let me just answer that very quickly for you, Kent. Are you eligible for payment pause on a Federal Perkins Loan? I am so sorry to tell you, I don't know who told you that you were, but you are not. Not all federal student loans are eligible for deferral in terms of September 30, or non-payment pause. A Federal Perkins Loan is not eligible. Private student loans, private parent loans are not eligible. Certain other types of loans are not eligible, but I'll talk about that in a second here. But no Kent, you have got to make those payments unless you do something where you have a hardship deferment or something like that. But just off the bat, if you don't do anything, you better be making those payments. Karen, though, says, what a bummer. My kids' loans, they took out the payment pause, they're fine. But my parent plus loan that I took out for my kids, which is far greater than their Stafford Loans, a neighbor told me that I still have to pay. And then she has these little faces about how depressed she is. Well, Karen, it might do you some good to stop listening to your neighbor. What does your neighbor know? I have to tell you, Federal Direct Parent PLUS Loans are absolutely, absolutely qualified for what? For the payment pause. A Federal Direct Stafford Loan, a Federal Direct Grad PLUS Loan, a Federal Direct Parent PLUS Loan, or a Federal Direct Consolidation Loan all qualify. So stop crying over this. So it's really important everybody that you get the right information or you could just really put yourself into a total tizzy. Where should you go to get the best information? I've told you forever, you should go to www.SavingForCollege.com. Mark Kantrowitz, by far, by far and away, is the most brilliant, up-to-date, knowledgeable, brilliant person when it comes to student loans, 529 plans, anything and everything you could possibly know. So, if you just went there before you freak out, you would save yourself a whole lot of misery. Harriet writes in and she says, I am an employer and I am doing everything I can to help my employees. Are there any other programs that you know of that I could use to help them because I'm running out of money fast. Well, that's what's happening everywhere, Harriet. I'm sure you have applied or are applying for the SBA loans, they're trying to actually expand that program. I talked about those loans on a past podcast just a little bit ago, so I won't do it now, but I get your concern. You want to help your employees, but you also don't want to hurt yourself financially. And I have to tell you, I don't blame you because there's only so much you can do! And your heart is in the right place, but there are certain programs out there that if you could look into for your employees, it doesn't hurt you financially at all. And there's four of them that I have off the top of my head. I'm sure there are more, but you might want to look up something, a program called Flex Wage. Another program is called True Connect Employee Loan Solutions, another one is Hebrew Free Loan Associations, and last but not least, there's another program called Coalition for Safe Loan Alternatives Website. All of you should just look those up and see what they're all about, and that very possibly could help you a lot. Next, we have a question from Jo. Jo says, Allstate is my insurance company for my auto insurance, and I have been trying to find out, I can't get on the website, I'm really not very good at this, Suze. I am 75 years of age, so I thought rather than trying to find out from Allstate, I would just write to you. Thanks, Jo. I would just write to you and ask you if you knew if Allstate was doing anything for those of us that have auto insurance with them and are broke? Well, OK, Jo, I'm glad that you turned to me, and I happen to know, actually. I don't even know why I know this, but I happen to know this. Allstate, which is truly a company that I so love, I can't tell you, and no, they don't pay me to say that. They have offered for people who have auto insurance with them that you can skip two consecutive payments with them without any penalties, whatsoever. They're also allowing you to, really, because you're not driving anymore. You know, all of you are at home, which is why it's important, you should call your automobile insurance companies. Normally, they base your car insurance premium on how many miles do you drive? What do you do? Where do you go? Things like that. Well, guess what? You're all right now, sheltering in place, that's what you're doing. So you are not driving anymore. So, Allstate for one decided to do what's called a "shelter in place payback program." And they are literally taking off 15% of your April and May premium payment, and they're going to put that right back into your, you know, checking account or your savings account, wherever you have paid them from? So Allstate is really trying to help you guys. So, Jo, I'm so glad you came to me. The next question is somebody who wrote in and said it wasn't for the podcast, it was just for me. And I decided, wrong, it's for the podcast. You're going to write to me, you better know right here and right now that unless there's really a reason that I shouldn't share it with the community, I'm going to share it. Because I'm not one who believes, don't say this, don't say that. You should know me by now, I say everything I'm thinking. They just call me Unfiltered Suze, which is why it was always very dangerous for me to do live television, but then that's another story. But I liked this question or statement or whatever this is. But listen to it for just one second here. She asked, is there something we can do for those of us who have means to start some kind of fund in this depressed market to benefit those who cannot invest? Could you think of some vehicle? The financial disparity is so frightening. Thank you for your thoughts and all you do. Well, you know my friends out there and especially the woman who wrote this, it's not about is there a fund so people can start to invest? This isn't about investing. This is about, what is it, 60% of you out there live paycheck to paycheck? Maybe you have $400 to your name. So this isn't about how do we create a fund to help people invest? This is about how do we help people that really cannot pay their bills right now, how do we do that? And for those of us who do have means, I will tell you, in my opinion, this is the time that you dig into your wallets, into your accounts, and especially with family members and those that you trust and those that you know that their story is real, that you send them money, you wire them money so that they don't have to work for two or three months and they can pay all their bills. And so, if they can pay all their bills, maybe the people who are, you know, they're paying their bills to, can then make it that those other people who can't pay their bills, they'll allow them to just slide then because of that, or to give them some leniency. So I really do think this is a time, and I have done this with many of my relatives right now, as well as people that I know are suffering, that I know are suffering and they're still going to work because they can't afford not to go to work. You know, when you are a white-collar worker, maybe you can still work from home. So many of my partners and companies that I work with, they have 80 employees and all of their employees are working from home. They still have a paycheck. But when you are a service worker or a worker who collects the garbage, washes floors, is a waiter or waitress, is whatever it may be, you have to go to work. You can't do your work from home. And one of the women who I've been working with forever, one of the Domestic Violence Hotline survivors that I've dealt with in the past, and, you know, I think on Sunday I want to address this topic about abuse, and how this virus is absolutely wreaking havoc more than ever on those of you who are in an abusive relationship.So you all should really listen to this podcast on Sunday. I obviously haven't recorded it yet, but I think it's an important topic to address right now because some of the emails that I'm getting are absolutely frightening. It's not about losing money, it's not about losing your life to the virus, it's about losing your life to the person that you're living with. It's really very sad, everybody. But I do think that this is a time if you have the means, reach into your pockets and absolutely help those who need it. Take your stimulus check that you may be getting and give it to somebody else. And I just have to say this. So many thousands of you have written to me and you're asking me for money and asking me to support this, and asking me for this and that. And I obviously can't do that because of people who are con artists. I don't know who out there is a con artist and who is not. And is your story real or is it not? So, it's so sad, it's so very, very sad, but I hope you all understand that. All right, let's do a few more here. This one's from Julie S. Hi, Suze. Listening to your Sunday podcast (she means last Sunday) I have a question about 401ks that you talked about. I'm retired now, I retired at 66. I'm almost 67 in two weeks and I still have my 401k from where I retired from. Are they really going to pull their match from this, or is it only for those who are still working? She also asks a second question, which is, don't Roth IRAs have to be in the Roth for five years before withdrawing money? This my favorite part of her email. I love your podcasts, sincerely, Julie S. So first, please know Julie, that no, employers who have already contributed the employee match into a 401 K plan, they are not taking away that match. That is your money, nobody can take it from you. However, many of you know this, that you are receiving letters that are saying your 401ks are going to stop matching your contributions. Those matches, they don't have to do that anymore. So then you have to decide, do you want to continue putting money in your 401k, in your Roth 401k, or 403b, or TSP, or are you better off doing a Roth IRA? I will tell you, hands down, you are better off with a Roth IRA if you qualify for it, hands down rather than a 401k, even a 401k Roth that doesn't match. And Julie, in regards to your second question, don't you have to be in a Roth for five years before withdrawing money? Not your original contributions. So, if you have a contributory Roth IRA where you put money in every single year, you can take out any amount that you have contributed without any taxes or penalties, regardless of your age or how long the money has been in there. It is the earnings on that money that have to stay in there for five years and until you are 59 a half years of age or older. That's how that works. And I thought this was an interesting one. This one is from Lauren and she says, hi, Suze. I'm a landlord of a condominium unit. The renters are a married couple, one who is on SSI disability and the other is employed by the county government. I believe their financial impact due to COVID-19 is not an issue. They haven't lost their jobs or SSI payment. My question is, what should I do If they ask to withhold paying rent? I would absolutely consider it, but I don't think their finances have changed where they are unable to pay rent. Is there a way I can ask to show hardship before creating a payment plan? She goes on to say, I ask this because the husband is very difficult to deal with on a general basis. I want to be fair, but just don't feel if their ability to collect full paychecks hasn't changed, then there is no need for me to be in hardship. I still have taxes and association fees that are due every month. Thanks for all your knowledge and caring, concerned Lauren. Oh, my dear Lauren, I couldn't agree with you more. You know, there are many programs up there that are allowing you not to pay payments, not to have to do student loans and things like that. So I think we need to be very considerate as to who we are paying our bills to. If our bills are from a major corporation such as Allstate, or student loans, or things like that, and it would help you to defer those payments, and there's no penalty for you to do so, or your mortgages, or whatever, I don't have a problem with you doing that at all. But when it's a person, it's a person that you pay rent to, and that person has also bills and responsibilities, and I talked about this again, I think it was last week. Then, that's a whole other thing. So don't go claiming that it's a hardship if it's not. If you're still getting in this case, your SSI disability or if you still have a job and you're getting your full paycheck, so you absolutely should be paying your landlord, if that is the case. If it's not the case, then show them that it's not the case. Show Lauren that you're not getting your paycheck anymore, you were just laid off and then, obviously, she's willing to work with you. So, Lauren, don't feel bad about it. If your gut is saying to you that you know I don't quite trust this, I'm not exactly sure, you better go with it, girlfriend, and nobody should be difficult to deal with. You know, everybody should treat one another with absolute respect and love, especially now, so just go for it. And either they do or they don't, and it's kind of you that you're willing to work with them. And for the last one, I just want to end with a comment that Michelle sent in that possibly could help a lot of you. She says, good morning, Suze. Thank you for your podcast. I am emailing in regards to today's podcast, April 2, 2020 (so it was a week ago) about the mother of two children you recommended to apply for SNAP and WIC who is having a difficult time providing food for her children. I wanted to mention that many, many public school districts who participate in the federal free and reduced lunch programs are required to offer breakfast and lunch for children under the age of 18. Parents are not required to show proof of residence or enrollment. I live in Texas and we have over 1k feeding sites throughout the state. So, I wanted to just say that to all of you because this will be helpful if any of you out there have information that would be helpful for others to hear. As Michelle did, send it on in because we all need to help one another now. And it's very difficult for me to stay up on everything and how quickly everything is changing, and what some financial institutions will do and what others won't do and all of this stuff. So, let's make this a true community where we help one another if you have information that could help those Women and Money listeners, as well as the men smart enough to be here. All right, everybody, remember, HSN this coming Saturday at 7 p.m. Call in with your questions, and I will be back on Sunday. Until then, stay healthy, stay safe and most of all, stay strong. In providing answers neither Suze Orman Media nor Suze Orman is acting as a Certified Financial Planner, advisor, a Certified Financial Analyst, an economist, CPA, accountant, or lawyer. Neither Suze Orman Media nor Suze Orman makes any recommendations as to any specific securities or investments. 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